Re-THINK-ing THINK: The Electric Car Company SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Re-THINK-ing THINK: The Electric Car Company
To maximize their effectiveness, color cases should be printed in color.On January 5, 2010, 48-year-old Richard Canny was on his way to meet the Governor of Indiana. He was reading his newly issued press release, announcing that THINK planned to start automobile production in Elkhart County, Indiana and to launch its THINK City battery-operated electric vehicle (EV) in the North American market. The announcement boldly outlined plans to invest $43.5 million in a factory that could begin assembling vehicles in early 2011 and that was sized for a manufacturing capacity for more than 20,000 vehicles per year. A proven automotive industry executive, but a first-time entrepreneur, Canny was CEO of Think Global AS (THINK), a privately held Norwegian maker of battery-operated electric vehicles (EVs) that were rechargeable through residential electrical power outlets. With this announcement, Canny was committing the company to support the broad North American launch of its line of EVs, among the very first commercially available, highway-approved safe cars in the world that produced zero greenhouse gas tailpipe emissions.
Swot Analysis of "Re-THINK-ing THINK: The Electric Car Company" written by Joseph B. Lassiter, David Kiron includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Canny Evs facing as an external strategic factors. Some of the topics covered in Re-THINK-ing THINK: The Electric Car Company case study are - Strategic Management Strategies, Entrepreneurial management, Financial management, International business, Joint ventures, Marketing, Product development and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Re-THINK-ing THINK: The Electric Car Company casestudy better are - – increasing transportation and logistics costs, technology disruption, increasing inequality as vast percentage of new income is going to the top 1%, banking and financial system is disrupted by Bitcoin and other crypto currencies, digital marketing is dominated by two big players Facebook and Google, customer relationship management is fast transforming because of increasing concerns over data privacy, central banks are concerned over increasing inflation,
increasing commodity prices, increasing energy prices, etc
Introduction to SWOT Analysis of Re-THINK-ing THINK: The Electric Car Company
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Re-THINK-ing THINK: The Electric Car Company case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Canny Evs, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Canny Evs 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 Re-THINK-ing THINK: The Electric Car Company can be done for the following purposes –
1. Strategic planning using facts provided in Re-THINK-ing THINK: The Electric Car Company case study
2. Improving business portfolio management of Canny Evs
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 Canny Evs
Strengths Re-THINK-ing THINK: The Electric Car Company | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Canny Evs in Re-THINK-ing THINK: The Electric Car Company Harvard Business Review case study are -
Cross disciplinary teams
– Horizontal connected teams at the Canny Evs 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.
Low bargaining power of suppliers
– Suppliers of Canny Evs in the sector have low bargaining power. Re-THINK-ing THINK: The Electric Car Company has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Canny Evs to manage not only supply disruptions but also source products at highly competitive prices.
Strong track record of project management
– Canny Evs 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 Canny Evs 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.
Organizational Resilience of Canny Evs
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Canny Evs does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– Canny Evs has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Re-THINK-ing THINK: The Electric Car Company 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.
Analytics focus
– Canny Evs 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 Joseph B. Lassiter, David Kiron 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
– Canny Evs is one of the most innovative firm in sector. Manager in Re-THINK-ing THINK: The Electric Car Company Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Diverse revenue streams
– Canny Evs is present in almost all the verticals within the industry. This has provided firm in Re-THINK-ing THINK: The Electric Car Company 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.
Ability to lead change in Innovation & Entrepreneurship field
– Canny Evs 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 Canny Evs in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– Re-THINK-ing THINK: The Electric Car Company firm has clearly differentiated products in the market place. This has enabled Canny Evs to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Canny Evs to invest into research and development (R&D) and innovation.
Digital Transformation in Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Canny Evs digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Canny Evs 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.
Weaknesses Re-THINK-ing THINK: The Electric Car Company | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Re-THINK-ing THINK: The Electric Car Company are -
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Re-THINK-ing THINK: The Electric Car Company, is just above the industry average. Canny Evs 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.
Aligning sales with marketing
– It come across in the case study Re-THINK-ing THINK: The Electric Car Company 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 Re-THINK-ing THINK: The Electric Car Company can leverage the sales team experience to cultivate customer relationships as Canny Evs is planning to shift buying processes online.
High bargaining power of channel partners
– Because of the regulatory requirements, Joseph B. Lassiter, David Kiron suggests that, Canny Evs is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Need for greater diversity
– Canny Evs 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.
Slow decision making process
– As mentioned earlier in the report, Canny Evs 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. Canny Evs 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.
Products dominated business model
– Even though Canny Evs 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 - Re-THINK-ing THINK: The Electric Car Company should strive to include more intangible value offerings along with its core products and services.
Workers concerns about automation
– As automation is fast increasing in the segment, Canny Evs 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.
Slow to strategic competitive environment developments
– As Re-THINK-ing THINK: The Electric Car Company HBR case study mentions - Canny Evs 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.
Increasing silos among functional specialists
– The organizational structure of Canny Evs is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Canny Evs needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Canny Evs to focus more on services rather than just following the product oriented approach.
No frontier risks strategy
– After analyzing the HBR case study Re-THINK-ing THINK: The Electric Car Company, 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Canny Evs is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Re-THINK-ing THINK: The Electric Car Company 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 Re-THINK-ing THINK: The Electric Car Company | 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 Re-THINK-ing THINK: The Electric Car Company are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Canny Evs 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, Re-THINK-ing THINK: The Electric Car Company, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Canny Evs 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. Canny Evs 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Canny Evs can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Canny Evs can use these opportunities to build new business models that can help the communities that Canny Evs operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Better consumer reach
– The expansion of the 5G network will help Canny Evs to increase its market reach. Canny Evs 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.
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 Canny Evs 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.
Leveraging digital technologies
– Canny Evs 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.
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. Canny Evs can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Using analytics as competitive advantage
– Canny Evs 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 Re-THINK-ing THINK: The Electric Car Company - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Canny Evs to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Manufacturing automation
– Canny Evs 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.
Building a culture of innovation
– managers at Canny Evs 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 Canny Evs 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Canny Evs is facing challenges because of the dominance of functional experts in the organization. Re-THINK-ing THINK: The Electric Car Company 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.
Threats Re-THINK-ing THINK: The Electric Car Company External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Re-THINK-ing THINK: The Electric Car Company are -
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.
Shortening product life cycle
– it is one of the major threat that Canny Evs is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Canny Evs business can come under increasing regulations regarding data privacy, data security, etc.
Regulatory challenges
– Canny Evs 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.
Increasing wage structure of Canny Evs
– 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 Canny Evs.
High dependence on third party suppliers
– Canny Evs high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Canny Evs.
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. Canny Evs 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.
Consumer confidence and its impact on Canny Evs 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Canny Evs 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.
Technology acceleration in Forth Industrial Revolution
– Canny Evs has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Canny Evs 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 Canny Evs in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Re-THINK-ing THINK: The Electric Car Company, Canny Evs 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 .
Weighted SWOT Analysis of Re-THINK-ing THINK: The Electric Car Company 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 Re-THINK-ing THINK: The Electric Car Company 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 Re-THINK-ing THINK: The Electric Car Company 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 Re-THINK-ing THINK: The Electric Car Company 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 Re-THINK-ing THINK: The Electric Car Company 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 Canny Evs needs to make to build a sustainable competitive advantage.
