Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection
Comprising networked organizations that span advanced and developing countries, the athletic footwear sector is at the cutting edge of globalization. An important dimension of corporate responsibility is setting and maintaining labor standards for contractors' employees in countries where workers have little or no legal protection against exploitation. This article examines how adidas, the industry's No. 2 firm, has utilized a code of labor practice to regulate the labor standards of its main manufacturing suppliers. A comparative analysis of a matched sample of two contractors in China shows that although the code requirements were met in both cases, relationships with adidas not only differed but also made a difference. Compared with compliance-type relationships, collaborative global firm-contractor ties encourage higher workplace performance and better employment relations in contractor factories.
Swot Analysis of "Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection" written by Stephen J. Frenkel, Duncan Scott includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Adidas Labor facing as an external strategic factors. Some of the topics covered in Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection case study are - Strategic Management Strategies, Globalization, Labor, Social responsibility and Global Business.
Some of the macro environment factors that can be used to understand the Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection casestudy better are - – increasing energy prices, increasing transportation and logistics costs, supply chains are disrupted by pandemic , technology disruption, digital marketing is dominated by two big players Facebook and Google, talent flight as more people leaving formal jobs, increasing government debt because of Covid-19 spendings,
increasing commodity prices, there is backlash against globalization, etc
Introduction to SWOT Analysis of Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Adidas Labor, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Adidas Labor operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection can be done for the following purposes –
1. Strategic planning using facts provided in Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection case study
2. Improving business portfolio management of Adidas Labor
3. Assessing feasibility of the new initiative in Global Business field.
4. Making a Global Business topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Adidas Labor
Strengths Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Adidas Labor in Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection Harvard Business Review case study are -
Cross disciplinary teams
– Horizontal connected teams at the Adidas Labor are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Learning organization
- Adidas Labor is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Adidas Labor is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Effective Research and Development (R&D)
– Adidas Labor has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Training and development
– Adidas Labor has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Superior customer experience
– The customer experience strategy of Adidas Labor in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Adidas Labor has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to recruit top talent
– Adidas Labor is one of the leading recruiters in the industry. Managers in the Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Adidas Labor digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Adidas Labor has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Ability to lead change in Global Business field
– Adidas Labor is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Adidas Labor in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Successful track record of launching new products
– Adidas Labor has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Adidas Labor has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
High switching costs
– The high switching costs that Adidas Labor has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Low bargaining power of suppliers
– Suppliers of Adidas Labor in the sector have low bargaining power. Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Adidas Labor to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection are -
No frontier risks strategy
– After analyzing the HBR case study Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection, it seems that company is thinking about the frontier risks that can impact Global Business strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Need for greater diversity
– Adidas Labor has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection, in the dynamic environment Adidas Labor has struggled to respond to the nimble upstart competition. Adidas Labor has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Adidas Labor is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Lack of clear differentiation of Adidas Labor products
– To increase the profitability and margins on the products, Adidas Labor needs to provide more differentiated products than what it is currently offering in the marketplace.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Adidas Labor supply chain. Even after few cautionary changes mentioned in the HBR case study - Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Adidas Labor vulnerable to further global disruptions in South East Asia.
Products dominated business model
– Even though Adidas Labor has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection should strive to include more intangible value offerings along with its core products and services.
Aligning sales with marketing
– It come across in the case study Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection can leverage the sales team experience to cultivate customer relationships as Adidas Labor is planning to shift buying processes online.
Slow decision making process
– As mentioned earlier in the report, Adidas Labor has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Adidas Labor even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Adidas Labor has relatively successful track record of launching new products.
Low market penetration in new markets
– Outside its home market of Adidas Labor, firm in the HBR case study Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Opportunities Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection are -
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Adidas Labor in the consumer business. Now Adidas Labor can target international markets with far fewer capital restrictions requirements than the existing system.
Manufacturing automation
– Adidas Labor can use the latest technology developments to improve its manufacturing and designing process in Global Business segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Adidas Labor to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Adidas Labor to hire the very best people irrespective of their geographical location.
Better consumer reach
– The expansion of the 5G network will help Adidas Labor to increase its market reach. Adidas Labor will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Adidas Labor can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Low interest rates
– Even though inflation is raising its head in most developed economies, Adidas Labor can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Adidas Labor can use these opportunities to build new business models that can help the communities that Adidas Labor operates in. Secondly it can use opportunities from government spending in Global Business sector.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Global Business industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Adidas Labor can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Adidas Labor can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Adidas Labor to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Developing new processes and practices
– Adidas Labor can develop new processes and procedures in Global Business industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Adidas Labor can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Adidas Labor is facing challenges because of the dominance of functional experts in the organization. Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Global Business industry, but it has also influenced the consumer preferences. Adidas Labor can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection are -
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Adidas Labor.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Adidas Labor business can come under increasing regulations regarding data privacy, data security, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Adidas Labor can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection .
Increasing wage structure of Adidas Labor
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Adidas Labor.
Technology acceleration in Forth Industrial Revolution
– Adidas Labor has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Adidas Labor needs to keep up with the evolution of technology in the Global Business sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Adidas Labor needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Adidas Labor in the Global Business industry. The Global Business industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Shortening product life cycle
– it is one of the major threat that Adidas Labor is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Environmental challenges
– Adidas Labor needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Adidas Labor can take advantage of this fund but it will also bring new competitors in the Global Business industry.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
High dependence on third party suppliers
– Adidas Labor high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Regulatory challenges
– Adidas Labor needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Global Business industry regulations.
Weighted SWOT Analysis of Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Compliance, Collaboration, and Codes of Labor Practice: The adidas Connection is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Adidas Labor needs to make to build a sustainable competitive advantage.
