John D. Rockefeller and the Creation of Standard Oil SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of John D. Rockefeller and the Creation of Standard Oil
Reconstructs the entrepreneurial journey of John D. Rockefeller, founder of Standard Oil and one of the most famous business figures in history. Traces his early career as a retailer in Cleveland through his decision to enter the oil industry in the early 1860s to his creation of Standard Oil. Pays particular attention to the critical decades of the 1870s and 1880s when Standard Oil and the larger oil business were growing at white-hot speed. Told through the words of both scholars and first-hand participants, examines Rockefeller's (controversial) strategy for securing and maintaining Standard Oil's market dominance, his organizational innovations within the company, and his responses to a myriad of competitive threats. Also, provides a close look at Rockefeller's life outside his office, including his role as a husband and father. Closes with a contemporary analysis of the ethics of Rockefeller's actions.
Swot Analysis of "John D. Rockefeller and the Creation of Standard Oil" written by Nancy F. Koehn, Katherine Miller includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Rockefeller's Oil facing as an external strategic factors. Some of the topics covered in John D. Rockefeller and the Creation of Standard Oil case study are - Strategic Management Strategies, Competitive strategy, Emerging markets, Ethics, Innovation, Leadership, Social enterprise and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the John D. Rockefeller and the Creation of Standard Oil casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, central banks are concerned over increasing inflation, increasing energy prices, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing transportation and logistics costs, competitive advantages are harder to sustain because of technology dispersion, increasing commodity prices,
challanges to central banks by blockchain based private currencies, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of John D. Rockefeller and the Creation of Standard Oil
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in John D. Rockefeller and the Creation of Standard Oil case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Rockefeller's Oil, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Rockefeller's Oil 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 John D. Rockefeller and the Creation of Standard Oil can be done for the following purposes –
1. Strategic planning using facts provided in John D. Rockefeller and the Creation of Standard Oil case study
2. Improving business portfolio management of Rockefeller's Oil
3. Assessing feasibility of the new initiative in Innovation & Entrepreneurship field.
4. Making a Innovation & Entrepreneurship topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Rockefeller's Oil
Strengths John D. Rockefeller and the Creation of Standard Oil | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Rockefeller's Oil in John D. Rockefeller and the Creation of Standard Oil Harvard Business Review case study are -
Operational resilience
– The operational resilience strategy in the John D. Rockefeller and the Creation of Standard Oil 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.
Superior customer experience
– The customer experience strategy of Rockefeller's Oil in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to recruit top talent
– Rockefeller's Oil is one of the leading recruiters in the industry. Managers in the John D. Rockefeller and the Creation of Standard Oil 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 Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Rockefeller's Oil digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Rockefeller's Oil 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.
Cross disciplinary teams
– Horizontal connected teams at the Rockefeller's Oil 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.
Diverse revenue streams
– Rockefeller's Oil is present in almost all the verticals within the industry. This has provided firm in John D. Rockefeller and the Creation of Standard Oil 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.
Strong track record of project management
– Rockefeller's Oil is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to lead change in Innovation & Entrepreneurship field
– Rockefeller's Oil 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 Rockefeller's Oil in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Analytics focus
– Rockefeller's Oil 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 Nancy F. Koehn, Katherine Miller 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.
Learning organization
- Rockefeller's Oil 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 Rockefeller's Oil is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in John D. Rockefeller and the Creation of Standard Oil Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Training and development
– Rockefeller's Oil has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in John D. Rockefeller and the Creation of Standard Oil 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.
Highly skilled collaborators
– Rockefeller's Oil 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 John D. Rockefeller and the Creation of Standard Oil HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses John D. Rockefeller and the Creation of Standard Oil | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of John D. Rockefeller and the Creation of Standard Oil are -
High operating costs
– Compare to the competitors, firm in the HBR case study John D. Rockefeller and the Creation of Standard Oil 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 Rockefeller's Oil 's lucrative customers.
Slow decision making process
– As mentioned earlier in the report, Rockefeller's Oil 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. Rockefeller's Oil 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study John D. Rockefeller and the Creation of Standard Oil, in the dynamic environment Rockefeller's Oil has struggled to respond to the nimble upstart competition. Rockefeller's Oil has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Skills based hiring
– The stress on hiring functional specialists at Rockefeller's Oil 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study John D. Rockefeller and the Creation of Standard Oil, it seems that the employees of Rockefeller's Oil don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Low market penetration in new markets
– Outside its home market of Rockefeller's Oil, firm in the HBR case study John D. Rockefeller and the Creation of Standard Oil needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the John D. Rockefeller and the Creation of Standard Oil 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 Rockefeller's Oil has relatively successful track record of launching new products.
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 Rockefeller's Oil supply chain. Even after few cautionary changes mentioned in the HBR case study - John D. Rockefeller and the Creation of Standard Oil, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Rockefeller's Oil vulnerable to further global disruptions in South East Asia.
No frontier risks strategy
– After analyzing the HBR case study John D. Rockefeller and the Creation of Standard Oil, it seems that company is thinking about the frontier risks that can impact Innovation & Entrepreneurship 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.
Lack of clear differentiation of Rockefeller's Oil products
– To increase the profitability and margins on the products, Rockefeller's Oil needs to provide more differentiated products than what it is currently offering in the marketplace.
Need for greater diversity
– Rockefeller's Oil 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.
Opportunities John D. Rockefeller and the Creation of Standard Oil | 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 John D. Rockefeller and the Creation of Standard Oil are -
Developing new processes and practices
– Rockefeller's Oil can develop new processes and procedures in Innovation & Entrepreneurship 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Rockefeller's Oil 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 Rockefeller's Oil 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, Rockefeller's Oil 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.
Leveraging digital technologies
– Rockefeller's Oil 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Rockefeller's Oil in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Innovation & Entrepreneurship segment, and it will provide faster access to the consumers.
Loyalty marketing
– Rockefeller's Oil 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 Rockefeller's Oil 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.
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 Rockefeller's Oil 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Rockefeller's Oil 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, John D. Rockefeller and the Creation of Standard Oil, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Rockefeller's Oil can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Creating value in data economy
– The success of analytics program of Rockefeller's Oil has opened avenues for new revenue streams for the organization in the industry. This can help Rockefeller's Oil to build a more holistic ecosystem as suggested in the John D. Rockefeller and the Creation of Standard Oil case study. Rockefeller's Oil can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Manufacturing automation
– Rockefeller's Oil can use the latest technology developments to improve its manufacturing and designing process in Innovation & Entrepreneurship 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, Rockefeller's Oil can use these opportunities to build new business models that can help the communities that Rockefeller's Oil operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Threats John D. Rockefeller and the Creation of Standard Oil External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study John D. Rockefeller and the Creation of Standard Oil are -
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. Rockefeller's Oil needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.
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 Rockefeller's Oil 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, Rockefeller's Oil 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 John D. Rockefeller and the Creation of Standard Oil .
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.
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 Rockefeller's Oil.
Increasing wage structure of Rockefeller's Oil
– 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 Rockefeller's Oil.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study John D. Rockefeller and the Creation of Standard Oil, Rockefeller's Oil may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Innovation & Entrepreneurship .
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 Rockefeller's Oil in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Regulatory challenges
– Rockefeller's Oil 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 Innovation & Entrepreneurship industry regulations.
Technology acceleration in Forth Industrial Revolution
– Rockefeller's Oil has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Rockefeller's Oil needs to keep up with the evolution of technology in the Innovation & Entrepreneurship 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 dependence on third party suppliers
– Rockefeller's Oil 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.
Environmental challenges
– Rockefeller's Oil 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. Rockefeller's Oil can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
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. Rockefeller's Oil 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.
Weighted SWOT Analysis of John D. Rockefeller and the Creation of Standard Oil 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 John D. Rockefeller and the Creation of Standard Oil 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 John D. Rockefeller and the Creation of Standard Oil 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 John D. Rockefeller and the Creation of Standard Oil 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 John D. Rockefeller and the Creation of Standard Oil 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 Rockefeller's Oil needs to make to build a sustainable competitive advantage.