Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
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Case Study SWOT Analysis Solution
Case Study Description of Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship
After Joanne Hyland had spent three years managing the growth and development of the Business Ventures Group (BVG), Nortel Networks senior management was challenging Hyland, vice-president for new venture development at Nortel Networks, to justify the BVG's existence and show its impact on Nortel Networks' bottom line. From a strategic perspective, Nortel Networks was struggling to evolve from being a telecommunications company to becoming a major player in the Internet Age. According to Nortel Networks top executives, to achieve success, the capabilities often second nature to start-up businesses were needed and they viewed the BVG as a learning opportunity. Having a formal program for evaluating and cultivating venture opportunities allowed Nortel Networks to streamline its innovation management processes continually and potentially uncover efficiencies that could be applied to its numerous lines of business. Considers how Nortel Networks could manage spinout ventures and other unaligned business opportunities in the future.
Authors :: Gina Colarelli O'Connor, William T. Maslyn
Swot Analysis of "Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship" written by Gina Colarelli O'Connor, William T. Maslyn includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Nortel Networks facing as an external strategic factors. Some of the topics covered in Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship case study are - Strategic Management Strategies, Entrepreneurship, Innovation and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship casestudy better are - – increasing government debt because of Covid-19 spendings, digital marketing is dominated by two big players Facebook and Google, supply chains are disrupted by pandemic , competitive advantages are harder to sustain because of technology dispersion, customer relationship management is fast transforming because of increasing concerns over data privacy, central banks are concerned over increasing inflation, challanges to central banks by blockchain based private currencies,
technology disruption, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Nortel Networks, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Nortel Networks 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 Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship can be done for the following purposes –
1. Strategic planning using facts provided in Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship case study
2. Improving business portfolio management of Nortel Networks
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 Nortel Networks
Strengths Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Nortel Networks in Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship Harvard Business Review case study are -
Analytics focus
– Nortel Networks 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 Gina Colarelli O'Connor, William T. Maslyn 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.
Superior customer experience
– The customer experience strategy of Nortel Networks in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to recruit top talent
– Nortel Networks is one of the leading recruiters in the industry. Managers in the Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Cross disciplinary teams
– Horizontal connected teams at the Nortel Networks 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.
High switching costs
– The high switching costs that Nortel Networks 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.
Diverse revenue streams
– Nortel Networks is present in almost all the verticals within the industry. This has provided firm in Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship 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
– Nortel Networks is one of the most innovative firm in sector. Manager in Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Organizational Resilience of Nortel Networks
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Nortel Networks does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Successful track record of launching new products
– Nortel Networks has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Nortel Networks 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.
Learning organization
- Nortel Networks 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 Nortel Networks is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Operational resilience
– The operational resilience strategy in the Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship 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.
Training and development
– Nortel Networks has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Weaknesses Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship are -
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship, in the dynamic environment Nortel Networks has struggled to respond to the nimble upstart competition. Nortel Networks has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High operating costs
– Compare to the competitors, firm in the HBR case study Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship 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 Nortel Networks 's lucrative customers.
Products dominated business model
– Even though Nortel Networks 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 - Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship should strive to include more intangible value offerings along with its core products and services.
Need for greater diversity
– Nortel Networks 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.
Skills based hiring
– The stress on hiring functional specialists at Nortel Networks 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.
Slow decision making process
– As mentioned earlier in the report, Nortel Networks 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. Nortel Networks 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.
Capital Spending Reduction
– Even during the low interest decade, Nortel Networks 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.
Aligning sales with marketing
– It come across in the case study Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship 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 Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship can leverage the sales team experience to cultivate customer relationships as Nortel Networks is planning to shift buying processes online.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship, is just above the industry average. Nortel Networks 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship, it seems that the employees of Nortel Networks 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Nortel Networks is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship | 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 Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship are -
Learning at scale
– Online learning technologies has now opened space for Nortel Networks 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.
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. Nortel Networks 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. Nortel Networks 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.
Better consumer reach
– The expansion of the 5G network will help Nortel Networks to increase its market reach. Nortel Networks 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Nortel Networks is facing challenges because of the dominance of functional experts in the organization. Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Nortel Networks 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Nortel Networks 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.
Creating value in data economy
– The success of analytics program of Nortel Networks has opened avenues for new revenue streams for the organization in the industry. This can help Nortel Networks to build a more holistic ecosystem as suggested in the Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship case study. Nortel Networks can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Nortel Networks can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Nortel Networks can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Developing new processes and practices
– Nortel Networks 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.
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 Nortel Networks in the consumer business. Now Nortel Networks can target international markets with far fewer capital restrictions requirements than the existing system.
Using analytics as competitive advantage
– Nortel Networks 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 Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Nortel Networks to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Nortel Networks can use these opportunities to build new business models that can help the communities that Nortel Networks operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Threats Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship are -
High dependence on third party suppliers
– Nortel Networks 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship, Nortel Networks 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 .
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 Nortel Networks.
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 Nortel Networks 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 Nortel Networks in the Innovation & Entrepreneurship 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Nortel Networks in the Innovation & Entrepreneurship industry. The Innovation & Entrepreneurship 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.
Stagnating economy with rate increase
– Nortel Networks can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Easy access to finance
– Easy access to finance in Innovation & Entrepreneurship field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Nortel Networks can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Nortel Networks 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.
Increasing wage structure of Nortel Networks
– 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 Nortel Networks.
Regulatory challenges
– Nortel Networks 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Nortel Networks with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Weighted SWOT Analysis of Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship 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 Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship 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 Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship 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 Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship 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 Nortel Networks' Business Ventures Group: One Corporation's Take on Entrepreneurship 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 Nortel Networks needs to make to build a sustainable competitive advantage.
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