Developing Effective Middle Management in an Entrepreneurial Firm in China SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Developing Effective Middle Management in an Entrepreneurial Firm in China
Victoria Idea Company Limited was a major network security solution provider based in Zhuhai, China. The company had been facing problems common to many family-owned businesses due to its management style. It was later restructured with the goal of transforming it from a family-run business to a professionally managed one by first removing most family members from the company and then slowly re-building a new, solid management structure. In order to instil a sense of responsibility and accountability in its middle managers, the company promoted staff from within instead of recruiting from outside, sponsored management training courses and made several other changes, including giving out shares to management staff. Despite all the efforts made, middle managers were still reluctant to make decisions on their own and would turn to senior management who used to be the sole decision-makers before the restructuring. Victoria Idea needed to find a way to develop a sense of trust among its middle managers so that the latter would feel confident to make decisions on their own without seeking advice or approval from senior management. A proactive and responsible management team was deemed to be crucial if the company wanted to expand further. This case illustrates how and why changes to long-established practices and operations or management styles can be difficult to implement.
Swot Analysis of "Developing Effective Middle Management in an Entrepreneurial Firm in China" written by Allen Fu Tze Yu, Yuen-ching Sin Fu includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Middle Management facing as an external strategic factors. Some of the topics covered in Developing Effective Middle Management in an Entrepreneurial Firm in China case study are - Strategic Management Strategies, Organizational culture, Reorganization, Social responsibility, Technology and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Developing Effective Middle Management in an Entrepreneurial Firm in China casestudy better are - – increasing transportation and logistics costs, there is increasing trade war between United States & China, talent flight as more people leaving formal jobs, increasing energy prices, increasing household debt because of falling income levels, competitive advantages are harder to sustain because of technology dispersion, central banks are concerned over increasing inflation,
cloud computing is disrupting traditional business models, there is backlash against globalization, etc
Introduction to SWOT Analysis of Developing Effective Middle Management in an Entrepreneurial Firm in China
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Developing Effective Middle Management in an Entrepreneurial Firm in China case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Middle Management, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Middle Management 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 Developing Effective Middle Management in an Entrepreneurial Firm in China can be done for the following purposes –
1. Strategic planning using facts provided in Developing Effective Middle Management in an Entrepreneurial Firm in China case study
2. Improving business portfolio management of Middle Management
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 Middle Management
Strengths Developing Effective Middle Management in an Entrepreneurial Firm in China | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Middle Management in Developing Effective Middle Management in an Entrepreneurial Firm in China Harvard Business Review case study are -
Ability to lead change in Innovation & Entrepreneurship field
– Middle Management 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 Middle Management in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Ability to recruit top talent
– Middle Management is one of the leading recruiters in the industry. Managers in the Developing Effective Middle Management in an Entrepreneurial Firm in China are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
High brand equity
– Middle Management has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Middle Management to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Superior customer experience
– The customer experience strategy of Middle Management in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Strong track record of project management
– Middle Management is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High switching costs
– The high switching costs that Middle Management 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.
Analytics focus
– Middle Management 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 Allen Fu Tze Yu, Yuen-ching Sin Fu 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.
Innovation driven organization
– Middle Management is one of the most innovative firm in sector. Manager in Developing Effective Middle Management in an Entrepreneurial Firm in China Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Effective Research and Development (R&D)
– Middle Management 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 Developing Effective Middle Management in an Entrepreneurial Firm in China - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Low bargaining power of suppliers
– Suppliers of Middle Management in the sector have low bargaining power. Developing Effective Middle Management in an Entrepreneurial Firm in China has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Middle Management to manage not only supply disruptions but also source products at highly competitive prices.
Successful track record of launching new products
– Middle Management has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Middle Management 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.
Operational resilience
– The operational resilience strategy in the Developing Effective Middle Management in an Entrepreneurial Firm in China 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.
Weaknesses Developing Effective Middle Management in an Entrepreneurial Firm in China | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Developing Effective Middle Management in an Entrepreneurial Firm in China are -
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Developing Effective Middle Management in an Entrepreneurial Firm in China, in the dynamic environment Middle Management has struggled to respond to the nimble upstart competition. Middle Management has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High cash cycle compare to competitors
Middle Management 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.
Products dominated business model
– Even though Middle Management 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 - Developing Effective Middle Management in an Entrepreneurial Firm in China should strive to include more intangible value offerings along with its core products and services.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Developing Effective Middle Management in an Entrepreneurial Firm in China 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 Middle Management has relatively successful track record of launching new products.
Slow to strategic competitive environment developments
– As Developing Effective Middle Management in an Entrepreneurial Firm in China HBR case study mentions - Middle Management 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Middle Management needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
No frontier risks strategy
– After analyzing the HBR case study Developing Effective Middle Management in an Entrepreneurial Firm in China, 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Developing Effective Middle Management in an Entrepreneurial Firm in China, is just above the industry average. Middle Management 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.
Low market penetration in new markets
– Outside its home market of Middle Management, firm in the HBR case study Developing Effective Middle Management in an Entrepreneurial Firm in China needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Need for greater diversity
– Middle Management 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.
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 Middle Management supply chain. Even after few cautionary changes mentioned in the HBR case study - Developing Effective Middle Management in an Entrepreneurial Firm in China, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Middle Management vulnerable to further global disruptions in South East Asia.
Opportunities Developing Effective Middle Management in an Entrepreneurial Firm in China | 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 Developing Effective Middle Management in an Entrepreneurial Firm in China are -
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Middle Management can use these opportunities to build new business models that can help the communities that Middle Management operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Low interest rates
– Even though inflation is raising its head in most developed economies, Middle Management 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Middle Management is facing challenges because of the dominance of functional experts in the organization. Developing Effective Middle Management in an Entrepreneurial Firm in China 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.
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. Middle Management 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. Middle Management 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.
Buying journey improvements
– Middle Management can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Developing Effective Middle Management in an Entrepreneurial Firm in China 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.
Creating value in data economy
– The success of analytics program of Middle Management has opened avenues for new revenue streams for the organization in the industry. This can help Middle Management to build a more holistic ecosystem as suggested in the Developing Effective Middle Management in an Entrepreneurial Firm in China case study. Middle Management 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 Middle Management can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Building a culture of innovation
– managers at Middle Management 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.
Better consumer reach
– The expansion of the 5G network will help Middle Management to increase its market reach. Middle Management 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.
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. Middle Management can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Using analytics as competitive advantage
– Middle Management 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 Developing Effective Middle Management in an Entrepreneurial Firm in China - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Middle Management to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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 Middle Management 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.
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. Middle Management can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats Developing Effective Middle Management in an Entrepreneurial Firm in China External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Developing Effective Middle Management in an Entrepreneurial Firm in China are -
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 Middle Management.
Consumer confidence and its impact on Middle Management demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Technology acceleration in Forth Industrial Revolution
– Middle Management has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Middle Management 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.
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 Middle Management in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Shortening product life cycle
– it is one of the major threat that Middle Management is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Middle Management can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Regulatory challenges
– Middle Management 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.
High dependence on third party suppliers
– Middle Management 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Middle Management with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Middle Management 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.
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. Middle Management needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Developing Effective Middle Management in an Entrepreneurial Firm in China, Middle Management 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 .
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Middle Management 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 Developing Effective Middle Management in an Entrepreneurial Firm in China .
Weighted SWOT Analysis of Developing Effective Middle Management in an Entrepreneurial Firm in China 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 Developing Effective Middle Management in an Entrepreneurial Firm in China 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 Developing Effective Middle Management in an Entrepreneurial Firm in China 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 Developing Effective Middle Management in an Entrepreneurial Firm in China 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 Developing Effective Middle Management in an Entrepreneurial Firm in China 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 Middle Management needs to make to build a sustainable competitive advantage.
