Swot Analysis of "Airbus vs. Boeing (C): Developments from 1996 to 1999" written by Ramon Casadesus-Masanell includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Color.an Airbus facing as an external strategic factors. Some of the topics covered in Airbus vs. Boeing (C): Developments from 1996 to 1999 case study are - Strategic Management Strategies, Mergers & acquisitions and Global Business.
Some of the macro environment factors that can be used to understand the Airbus vs. Boeing (C): Developments from 1996 to 1999 casestudy better are - – competitive advantages are harder to sustain because of technology dispersion, central banks are concerned over increasing inflation, increasing energy prices, increasing commodity prices, wage bills are increasing, digital marketing is dominated by two big players Facebook and Google, increasing household debt because of falling income levels,
increasing government debt because of Covid-19 spendings, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of Airbus vs. Boeing (C): Developments from 1996 to 1999
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Airbus vs. Boeing (C): Developments from 1996 to 1999 case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Color.an Airbus, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Color.an Airbus 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 Airbus vs. Boeing (C): Developments from 1996 to 1999 can be done for the following purposes –
1. Strategic planning using facts provided in Airbus vs. Boeing (C): Developments from 1996 to 1999 case study
2. Improving business portfolio management of Color.an Airbus
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 Color.an Airbus
Strengths Airbus vs. Boeing (C): Developments from 1996 to 1999 | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Color.an Airbus in Airbus vs. Boeing (C): Developments from 1996 to 1999 Harvard Business Review case study are -
Strong track record of project management
– Color.an Airbus is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Organizational Resilience of Color.an Airbus
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Color.an Airbus does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– Color.an Airbus has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Airbus vs. Boeing (C): Developments from 1996 to 1999 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.
High switching costs
– The high switching costs that Color.an Airbus 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.
Operational resilience
– The operational resilience strategy in the Airbus vs. Boeing (C): Developments from 1996 to 1999 Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Learning organization
- Color.an Airbus 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 Color.an Airbus is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Airbus vs. Boeing (C): Developments from 1996 to 1999 Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in Global Business industry
– Airbus vs. Boeing (C): Developments from 1996 to 1999 firm has clearly differentiated products in the market place. This has enabled Color.an Airbus to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Color.an Airbus to invest into research and development (R&D) and innovation.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Color.an Airbus digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Color.an Airbus 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.
Highly skilled collaborators
– Color.an Airbus 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 Airbus vs. Boeing (C): Developments from 1996 to 1999 HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Effective Research and Development (R&D)
– Color.an Airbus 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 Airbus vs. Boeing (C): Developments from 1996 to 1999 - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Superior customer experience
– The customer experience strategy of Color.an Airbus in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High brand equity
– Color.an Airbus has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Color.an Airbus to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses Airbus vs. Boeing (C): Developments from 1996 to 1999 | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Airbus vs. Boeing (C): Developments from 1996 to 1999 are -
High bargaining power of channel partners
– Because of the regulatory requirements, Ramon Casadesus-Masanell suggests that, Color.an Airbus 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.
Need for greater diversity
– Color.an Airbus 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.
Aligning sales with marketing
– It come across in the case study Airbus vs. Boeing (C): Developments from 1996 to 1999 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 Airbus vs. Boeing (C): Developments from 1996 to 1999 can leverage the sales team experience to cultivate customer relationships as Color.an Airbus is planning to shift buying processes online.
High cash cycle compare to competitors
Color.an Airbus 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.
Increasing silos among functional specialists
– The organizational structure of Color.an Airbus is dominated by functional specialists. It is not different from other players in the Global Business segment. Color.an Airbus needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Color.an Airbus to focus more on services rather than just following the product oriented approach.
Interest costs
– Compare to the competition, Color.an Airbus has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
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 Color.an Airbus supply chain. Even after few cautionary changes mentioned in the HBR case study - Airbus vs. Boeing (C): Developments from 1996 to 1999, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Color.an Airbus vulnerable to further global disruptions in South East Asia.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Airbus vs. Boeing (C): Developments from 1996 to 1999, is just above the industry average. Color.an Airbus 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Airbus vs. Boeing (C): Developments from 1996 to 1999 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 Color.an Airbus has relatively successful track record of launching new products.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Color.an Airbus is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Airbus vs. Boeing (C): Developments from 1996 to 1999 can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
No frontier risks strategy
– After analyzing the HBR case study Airbus vs. Boeing (C): Developments from 1996 to 1999, 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 Airbus vs. Boeing (C): Developments from 1996 to 1999 | 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 Airbus vs. Boeing (C): Developments from 1996 to 1999 are -
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. Color.an Airbus can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Loyalty marketing
– Color.an Airbus 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.
Learning at scale
– Online learning technologies has now opened space for Color.an Airbus 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.
Using analytics as competitive advantage
– Color.an Airbus 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 Airbus vs. Boeing (C): Developments from 1996 to 1999 - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Color.an Airbus to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Color.an Airbus 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. Color.an Airbus 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.
Manufacturing automation
– Color.an Airbus 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Color.an Airbus 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, Airbus vs. Boeing (C): Developments from 1996 to 1999, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Color.an Airbus can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Creating value in data economy
– The success of analytics program of Color.an Airbus has opened avenues for new revenue streams for the organization in the industry. This can help Color.an Airbus to build a more holistic ecosystem as suggested in the Airbus vs. Boeing (C): Developments from 1996 to 1999 case study. Color.an Airbus can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at Color.an Airbus 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Color.an Airbus can use these opportunities to build new business models that can help the communities that Color.an Airbus operates in. Secondly it can use opportunities from government spending in Global Business sector.
Leveraging digital technologies
– Color.an Airbus 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.
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 Color.an Airbus in the consumer business. Now Color.an Airbus can target international markets with far fewer capital restrictions requirements than the existing system.
Threats Airbus vs. Boeing (C): Developments from 1996 to 1999 External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Airbus vs. Boeing (C): Developments from 1996 to 1999 are -
Stagnating economy with rate increase
– Color.an Airbus 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.
Environmental challenges
– Color.an Airbus 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. Color.an Airbus can take advantage of this fund but it will also bring new competitors in the Global Business industry.
Increasing wage structure of Color.an Airbus
– 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 Color.an Airbus.
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 Color.an Airbus in the Global Business sector and impact the bottomline of the organization.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Color.an Airbus 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 Airbus vs. Boeing (C): Developments from 1996 to 1999 .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Color.an Airbus with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Color.an Airbus business can come under increasing regulations regarding data privacy, data security, etc.
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. Color.an Airbus 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 Color.an Airbus 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.
Regulatory challenges
– Color.an Airbus 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.
Shortening product life cycle
– it is one of the major threat that Color.an Airbus is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
High dependence on third party suppliers
– Color.an Airbus 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.
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 Color.an Airbus.
Weighted SWOT Analysis of Airbus vs. Boeing (C): Developments from 1996 to 1999 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 Airbus vs. Boeing (C): Developments from 1996 to 1999 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 Airbus vs. Boeing (C): Developments from 1996 to 1999 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 Airbus vs. Boeing (C): Developments from 1996 to 1999 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 Airbus vs. Boeing (C): Developments from 1996 to 1999 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 Color.an Airbus needs to make to build a sustainable competitive advantage.
