Case Study Description of Fisk Alloy Wire and Percon
Fisk Alloy Wire was a privately-owned specialty wire mill with facilities in Hawthorne, NJ and Oriskany, NY. The business focused on the development and manufacture of copper alloy wire for electronic components and conductors. Fisk Alloy had developed a copper alloy wire that was cadmium free (cadmium was a known carcinogen affecting both processing and disposal), but also met the characteristics of strength, conductivity, and elongation that defined a high performance wire. The product family, called Percon, was introduced into the market about the time the European Union passed the Restriction of Hazardous Substances ('RoHS') and the related Waste Electrical and Electronic Equipment ('WEEE') directives. The total market potential for Percon was not really known, since it could potentially be used in a broad variety of applications. Fisk Alloy was determined to be the best in its niche of the industry, but not necessarily the biggest. Management recognized that determining how to grow, slowly and opportunistically or more aggressively, would require balancing the market opportunities with the realities of capacity and related production issues.
Swot Analysis of "Fisk Alloy Wire and Percon" written by Susan F. Sieloff, Raymond M. Kinnunen includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Alloy Wire facing as an external strategic factors. Some of the topics covered in Fisk Alloy Wire and Percon case study are - Strategic Management Strategies, Marketing and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Fisk Alloy Wire and Percon casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing commodity prices, there is backlash against globalization, increasing transportation and logistics costs, geopolitical disruptions, there is increasing trade war between United States & China, technology disruption,
supply chains are disrupted by pandemic , central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of Fisk Alloy Wire and Percon
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Fisk Alloy Wire and Percon case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Alloy Wire, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Alloy Wire 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 Fisk Alloy Wire and Percon can be done for the following purposes –
1. Strategic planning using facts provided in Fisk Alloy Wire and Percon case study
2. Improving business portfolio management of Alloy Wire
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 Alloy Wire
Strengths Fisk Alloy Wire and Percon | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Alloy Wire in Fisk Alloy Wire and Percon Harvard Business Review case study are -
Ability to recruit top talent
– Alloy Wire is one of the leading recruiters in the industry. Managers in the Fisk Alloy Wire and Percon are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Highly skilled collaborators
– Alloy Wire 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 Fisk Alloy Wire and Percon HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to lead change in Innovation & Entrepreneurship field
– Alloy Wire 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 Alloy Wire in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Training and development
– Alloy Wire has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Fisk Alloy Wire and Percon 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.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– Fisk Alloy Wire and Percon firm has clearly differentiated products in the market place. This has enabled Alloy Wire to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Alloy Wire to invest into research and development (R&D) and innovation.
Diverse revenue streams
– Alloy Wire is present in almost all the verticals within the industry. This has provided firm in Fisk Alloy Wire and Percon 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
– Alloy Wire is one of the most innovative firm in sector. Manager in Fisk Alloy Wire and Percon Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Superior customer experience
– The customer experience strategy of Alloy Wire in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High switching costs
– The high switching costs that Alloy Wire has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Low bargaining power of suppliers
– Suppliers of Alloy Wire in the sector have low bargaining power. Fisk Alloy Wire and Percon has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Alloy Wire to manage not only supply disruptions but also source products at highly competitive prices.
Digital Transformation in Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Alloy Wire digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Alloy Wire 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.
High brand equity
– Alloy Wire has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Alloy Wire to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses Fisk Alloy Wire and Percon | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Fisk Alloy Wire and Percon are -
Aligning sales with marketing
– It come across in the case study Fisk Alloy Wire and Percon 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 Fisk Alloy Wire and Percon can leverage the sales team experience to cultivate customer relationships as Alloy Wire is planning to shift buying processes online.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Fisk Alloy Wire and Percon, it seems that the employees of Alloy Wire 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Fisk Alloy Wire and Percon, in the dynamic environment Alloy Wire has struggled to respond to the nimble upstart competition. Alloy Wire has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Fisk Alloy Wire and Percon 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 Alloy Wire has relatively successful track record of launching new products.
Increasing silos among functional specialists
– The organizational structure of Alloy Wire is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Alloy Wire needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Alloy Wire to focus more on services rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As Fisk Alloy Wire and Percon HBR case study mentions - Alloy Wire 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Fisk Alloy Wire and Percon, is just above the industry average. Alloy Wire 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.
Lack of clear differentiation of Alloy Wire products
– To increase the profitability and margins on the products, Alloy Wire needs to provide more differentiated products than what it is currently offering in the marketplace.
High operating costs
– Compare to the competitors, firm in the HBR case study Fisk Alloy Wire and Percon 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 Alloy Wire 's lucrative customers.
Capital Spending Reduction
– Even during the low interest decade, Alloy Wire 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.
Interest costs
– Compare to the competition, Alloy Wire 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.
Opportunities Fisk Alloy Wire and Percon | 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 Fisk Alloy Wire and Percon are -
Building a culture of innovation
– managers at Alloy Wire 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 Innovation & Entrepreneurship segment.
Learning at scale
– Online learning technologies has now opened space for Alloy Wire 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Alloy Wire 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Innovation & Entrepreneurship industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Alloy Wire 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. Alloy Wire 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Innovation & Entrepreneurship industry, but it has also influenced the consumer preferences. Alloy Wire can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Buying journey improvements
– Alloy Wire can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Fisk Alloy Wire and Percon 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Alloy Wire 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 Alloy Wire to hire the very best people irrespective of their geographical location.
Better consumer reach
– The expansion of the 5G network will help Alloy Wire to increase its market reach. Alloy Wire will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Alloy Wire can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Loyalty marketing
– Alloy Wire 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Alloy Wire 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, Fisk Alloy Wire and Percon, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Using analytics as competitive advantage
– Alloy Wire 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 Fisk Alloy Wire and Percon - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Alloy Wire to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Alloy Wire can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats Fisk Alloy Wire and Percon External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Fisk Alloy Wire and Percon are -
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 international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Alloy Wire 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 Fisk Alloy Wire and Percon .
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.
Easy access to finance
– Easy access to finance in Innovation & Entrepreneurship field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Alloy Wire can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Alloy Wire.
Stagnating economy with rate increase
– Alloy Wire 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.
High dependence on third party suppliers
– Alloy Wire 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.
Shortening product life cycle
– it is one of the major threat that Alloy Wire is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing wage structure of Alloy Wire
– 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 Alloy Wire.
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 Alloy Wire in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Environmental challenges
– Alloy Wire 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. Alloy Wire can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
Technology acceleration in Forth Industrial Revolution
– Alloy Wire has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Alloy Wire 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.
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. Alloy Wire 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 Fisk Alloy Wire and Percon 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 Fisk Alloy Wire and Percon 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 Fisk Alloy Wire and Percon 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 Fisk Alloy Wire and Percon 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 Fisk Alloy Wire and Percon 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 Alloy Wire needs to make to build a sustainable competitive advantage.
