What do Firms From Transition Economies Want From Their Strategic Alliance Partners? SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study Description of What do Firms From Transition Economies Want From Their Strategic Alliance Partners?
A financial system engaged in active transition from central planning to free market may be dubbed a transition economy. On today's global landscape, there are several important transition economies, all at various stages of transition and with differing degrees of success. Yet, much is not known about this important sector of the world economy. As outside enterprises seek alliances with firms from transition economies, it is important to know what these firms want from alliance partners. To learn more, we conducted a study interviewing managers of private firms from the two largest and most strategically important transition economies: China and Russia. We found that while Chinese and Russian firms often hope for some of the same things as their counterparts in mature economies as regards alliances, they are also interested in other things not normally associated with alliances: political influence, relief from paying bribes, and protection from extortion or even violence. Moreover, we discovered that because of differing institutional conditions in the two countries, Chinese firms are not always looking for the same things from alliances as are Russian firms-in spite of surface similarities between the two economies. Based on these findings, we provide guidelines for firms seeking alliance partners in transition economies, to assist them in determining if an alliance is right for them and planning accordingly.
Authors :: Michael N. Young, David Ahlstrom, Garry D. Bruton, Yuri Rubanik
Swot Analysis of "What do Firms From Transition Economies Want From Their Strategic Alliance Partners?" written by Michael N. Young, David Ahlstrom, Garry D. Bruton, Yuri Rubanik includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Economies Transition facing as an external strategic factors. Some of the topics covered in What do Firms From Transition Economies Want From Their Strategic Alliance Partners? case study are - Strategic Management Strategies, International business, Joint ventures and Global Business.
Some of the macro environment factors that can be used to understand the What do Firms From Transition Economies Want From Their Strategic Alliance Partners? casestudy better are - – central banks are concerned over increasing inflation, increasing energy prices, there is backlash against globalization, supply chains are disrupted by pandemic , geopolitical disruptions, increasing transportation and logistics costs, increasing inequality as vast percentage of new income is going to the top 1%,
banking and financial system is disrupted by Bitcoin and other crypto currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
Introduction to SWOT Analysis of What do Firms From Transition Economies Want From Their Strategic Alliance Partners?
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in What do Firms From Transition Economies Want From Their Strategic Alliance Partners? case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Economies Transition, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Economies Transition 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 What do Firms From Transition Economies Want From Their Strategic Alliance Partners? can be done for the following purposes –
1. Strategic planning using facts provided in What do Firms From Transition Economies Want From Their Strategic Alliance Partners? case study
2. Improving business portfolio management of Economies Transition
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 Economies Transition
Strengths What do Firms From Transition Economies Want From Their Strategic Alliance Partners? | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Economies Transition in What do Firms From Transition Economies Want From Their Strategic Alliance Partners? Harvard Business Review case study are -
Sustainable margins compare to other players in Global Business industry
– What do Firms From Transition Economies Want From Their Strategic Alliance Partners? firm has clearly differentiated products in the market place. This has enabled Economies Transition to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Economies Transition to invest into research and development (R&D) and innovation.
Diverse revenue streams
– Economies Transition is present in almost all the verticals within the industry. This has provided firm in What do Firms From Transition Economies Want From Their Strategic Alliance Partners? case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
High switching costs
– The high switching costs that Economies Transition 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.
Ability to recruit top talent
– Economies Transition is one of the leading recruiters in the industry. Managers in the What do Firms From Transition Economies Want From Their Strategic Alliance Partners? are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Superior customer experience
– The customer experience strategy of Economies Transition in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Economies Transition 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 What do Firms From Transition Economies Want From Their Strategic Alliance Partners? HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Learning organization
- Economies Transition 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 Economies Transition is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in What do Firms From Transition Economies Want From Their Strategic Alliance Partners? Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to lead change in Global Business field
– Economies Transition 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 Economies Transition 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
– Economies Transition has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Economies Transition 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.
Organizational Resilience of Economies Transition
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Economies Transition does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Strong track record of project management
– Economies Transition is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Training and development
– Economies Transition has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in What do Firms From Transition Economies Want From Their Strategic Alliance Partners? 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.
Weaknesses What do Firms From Transition Economies Want From Their Strategic Alliance Partners? | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of What do Firms From Transition Economies Want From Their Strategic Alliance Partners? are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Economies Transition is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study What do Firms From Transition Economies Want From Their Strategic Alliance Partners? can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Economies Transition needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Increasing silos among functional specialists
– The organizational structure of Economies Transition is dominated by functional specialists. It is not different from other players in the Global Business segment. Economies Transition needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Economies Transition to focus more on services rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As What do Firms From Transition Economies Want From Their Strategic Alliance Partners? HBR case study mentions - Economies Transition takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Capital Spending Reduction
– Even during the low interest decade, Economies Transition has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
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 Economies Transition supply chain. Even after few cautionary changes mentioned in the HBR case study - What do Firms From Transition Economies Want From Their Strategic Alliance Partners?, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Economies Transition vulnerable to further global disruptions in South East Asia.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study What do Firms From Transition Economies Want From Their Strategic Alliance Partners?, in the dynamic environment Economies Transition has struggled to respond to the nimble upstart competition. Economies Transition has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study What do Firms From Transition Economies Want From Their Strategic Alliance Partners?, is just above the industry average. Economies Transition needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Skills based hiring
– The stress on hiring functional specialists at Economies Transition has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Lack of clear differentiation of Economies Transition products
– To increase the profitability and margins on the products, Economies Transition needs to provide more differentiated products than what it is currently offering in the marketplace.
Products dominated business model
– Even though Economies Transition 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 - What do Firms From Transition Economies Want From Their Strategic Alliance Partners? should strive to include more intangible value offerings along with its core products and services.
Opportunities What do Firms From Transition Economies Want From Their Strategic Alliance Partners? | 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 What do Firms From Transition Economies Want From Their Strategic Alliance Partners? are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Economies Transition can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, What do Firms From Transition Economies Want From Their Strategic Alliance Partners?, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Learning at scale
– Online learning technologies has now opened space for Economies Transition to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Building a culture of innovation
– managers at Economies Transition can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Global Business segment.
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. Economies Transition 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. Economies Transition 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Economies Transition 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 Economies Transition to hire the very best people irrespective of their geographical location.
Low interest rates
– Even though inflation is raising its head in most developed economies, Economies Transition 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.
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. Economies Transition can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Economies Transition is facing challenges because of the dominance of functional experts in the organization. What do Firms From Transition Economies Want From Their Strategic Alliance Partners? 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.
Creating value in data economy
– The success of analytics program of Economies Transition has opened avenues for new revenue streams for the organization in the industry. This can help Economies Transition to build a more holistic ecosystem as suggested in the What do Firms From Transition Economies Want From Their Strategic Alliance Partners? case study. Economies Transition can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Loyalty marketing
– Economies Transition has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Manufacturing automation
– Economies Transition 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Economies Transition can use these opportunities to build new business models that can help the communities that Economies Transition operates in. Secondly it can use opportunities from government spending in Global Business sector.
Buying journey improvements
– Economies Transition can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. What do Firms From Transition Economies Want From Their Strategic Alliance Partners? suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Threats What do Firms From Transition Economies Want From Their Strategic Alliance Partners? External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study What do Firms From Transition Economies Want From Their Strategic Alliance Partners? are -
Technology acceleration in Forth Industrial Revolution
– Economies Transition has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Economies Transition 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.
Environmental challenges
– Economies Transition 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. Economies Transition can take advantage of this fund but it will also bring new competitors in the Global Business industry.
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 Economies Transition.
Shortening product life cycle
– it is one of the major threat that Economies Transition is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Economies Transition 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.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Economies Transition will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
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.
Increasing wage structure of Economies Transition
– 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 Economies Transition.
Regulatory challenges
– Economies Transition 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study What do Firms From Transition Economies Want From Their Strategic Alliance Partners?, Economies Transition may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Global Business .
High dependence on third party suppliers
– Economies Transition 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.
Stagnating economy with rate increase
– Economies Transition can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Easy access to finance
– Easy access to finance in Global Business field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Economies Transition can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of What do Firms From Transition Economies Want From Their Strategic Alliance Partners? 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 What do Firms From Transition Economies Want From Their Strategic Alliance Partners? 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 What do Firms From Transition Economies Want From Their Strategic Alliance Partners? 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 What do Firms From Transition Economies Want From Their Strategic Alliance Partners? 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 What do Firms From Transition Economies Want From Their Strategic Alliance Partners? 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 Economies Transition needs to make to build a sustainable competitive advantage.
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