Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt
Coping with uncertainty is a fundamental challenge for firms. One way they can respond is by building up strategic flexibility. By looking at airlines' flexibility responses to regulatory uncertainty associated with their inclusion in the European Union Emission Trading Scheme, this article shows that firms can respond to regulatory uncertainty by developing such flexibility in two ways: they can either anticipate the potential consequences of changing regulatory conditions and try to prepare for them; or they can adapt quickly and efficiently to them once the regulatory situation has become clear. By examining evidence from nine case studies, the article identifies the organizational capabilities required to pursue an anticipatory or adaptive strategy and demonstrates that each type of response requires a specific bundle of capabilities.
Authors :: Christian Engau, Volker H. Hoffmann, Timo Busch
Swot Analysis of "Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt" written by Christian Engau, Volker H. Hoffmann, Timo Busch includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Regulatory Flexibility facing as an external strategic factors. Some of the topics covered in Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt case study are - Strategic Management Strategies, Managing uncertainty, Operations management, Organizational culture and Global Business.
Some of the macro environment factors that can be used to understand the Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt casestudy better are - – talent flight as more people leaving formal jobs, increasing commodity prices, increasing household debt because of falling income levels, competitive advantages are harder to sustain because of technology dispersion, supply chains are disrupted by pandemic , increasing inequality as vast percentage of new income is going to the top 1%, technology disruption,
challanges to central banks by blockchain based private currencies, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Regulatory Flexibility, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Regulatory Flexibility 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 Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt can be done for the following purposes –
1. Strategic planning using facts provided in Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt case study
2. Improving business portfolio management of Regulatory Flexibility
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 Regulatory Flexibility
Strengths Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Regulatory Flexibility in Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt Harvard Business Review case study are -
Successful track record of launching new products
– Regulatory Flexibility has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Regulatory Flexibility 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.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Regulatory Flexibility digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Regulatory Flexibility 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.
Training and development
– Regulatory Flexibility has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt 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 Regulatory Flexibility in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Diverse revenue streams
– Regulatory Flexibility is present in almost all the verticals within the industry. This has provided firm in Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt 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.
Innovation driven organization
– Regulatory Flexibility is one of the most innovative firm in sector. Manager in Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Sustainable margins compare to other players in Global Business industry
– Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt firm has clearly differentiated products in the market place. This has enabled Regulatory Flexibility to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Regulatory Flexibility to invest into research and development (R&D) and innovation.
Ability to lead change in Global Business field
– Regulatory Flexibility 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 Regulatory Flexibility in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Analytics focus
– Regulatory Flexibility is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Christian Engau, Volker H. Hoffmann, Timo Busch can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
High brand equity
– Regulatory Flexibility has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Regulatory Flexibility to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Highly skilled collaborators
– Regulatory Flexibility 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 Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of Regulatory Flexibility
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Regulatory Flexibility does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt are -
Lack of clear differentiation of Regulatory Flexibility products
– To increase the profitability and margins on the products, Regulatory Flexibility needs to provide more differentiated products than what it is currently offering in the marketplace.
Products dominated business model
– Even though Regulatory Flexibility 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 - Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt should strive to include more intangible value offerings along with its core products and services.
Low market penetration in new markets
– Outside its home market of Regulatory Flexibility, firm in the HBR case study Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt, in the dynamic environment Regulatory Flexibility has struggled to respond to the nimble upstart competition. Regulatory Flexibility has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Aligning sales with marketing
– It come across in the case study Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt 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 Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt can leverage the sales team experience to cultivate customer relationships as Regulatory Flexibility is planning to shift buying processes online.
High cash cycle compare to competitors
Regulatory Flexibility has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
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 Regulatory Flexibility supply chain. Even after few cautionary changes mentioned in the HBR case study - Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Regulatory Flexibility vulnerable to further global disruptions in South East Asia.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt 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 Regulatory Flexibility has relatively successful track record of launching new products.
High bargaining power of channel partners
– Because of the regulatory requirements, Christian Engau, Volker H. Hoffmann, Timo Busch suggests that, Regulatory Flexibility is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
High operating costs
– Compare to the competitors, firm in the HBR case study Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Regulatory Flexibility 's lucrative customers.
No frontier risks strategy
– After analyzing the HBR case study Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt, 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.
Opportunities Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt | 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 Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt are -
Low interest rates
– Even though inflation is raising its head in most developed economies, Regulatory Flexibility 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.
Buying journey improvements
– Regulatory Flexibility can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt 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.
Using analytics as competitive advantage
– Regulatory Flexibility has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Regulatory Flexibility to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Regulatory Flexibility 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, Regulatory Flexibility is facing challenges because of the dominance of functional experts in the organization. Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt 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.
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. Regulatory Flexibility can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Regulatory Flexibility 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 Regulatory Flexibility to hire the very best people irrespective of their geographical location.
Better consumer reach
– The expansion of the 5G network will help Regulatory Flexibility to increase its market reach. Regulatory Flexibility 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Regulatory Flexibility can use these opportunities to build new business models that can help the communities that Regulatory Flexibility operates in. Secondly it can use opportunities from government spending in Global Business sector.
Learning at scale
– Online learning technologies has now opened space for Regulatory Flexibility 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.
Leveraging digital technologies
– Regulatory Flexibility can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Manufacturing automation
– Regulatory Flexibility 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Regulatory Flexibility can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt, Regulatory Flexibility 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 .
Technology acceleration in Forth Industrial Revolution
– Regulatory Flexibility has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Regulatory Flexibility 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Regulatory Flexibility with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Regulatory challenges
– Regulatory Flexibility 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.
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. Regulatory Flexibility 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.
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.
Consumer confidence and its impact on Regulatory Flexibility demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Increasing wage structure of Regulatory Flexibility
– 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 Regulatory Flexibility.
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 Regulatory Flexibility.
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 Regulatory Flexibility business can come under increasing regulations regarding data privacy, data security, etc.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Regulatory Flexibility in the Global Business sector and impact the bottomline of the organization.
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.
Shortening product life cycle
– it is one of the major threat that Regulatory Flexibility is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt 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 Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt 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 Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt 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 Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt 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 Airlines' Flexibility in Facing Regulatory Uncertainty: To Anticipate or Adapt 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 Regulatory Flexibility needs to make to build a sustainable competitive advantage.
