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, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing commodity prices, increasing household debt because of falling income levels, competitive advantages are harder to sustain because of technology dispersion, digital marketing is dominated by two big players Facebook and Google, wage bills are increasing,
customer relationship management is fast transforming because of increasing concerns over data privacy, central banks are concerned over increasing inflation, 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 -
Successful track record of launching new products
– Canny Evs has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Canny Evs 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.
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.
Effective Research and Development (R&D)
– Canny Evs 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 Re-THINK-ing THINK: The Electric Car Company - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
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.
Ability to recruit top talent
– Canny Evs is one of the leading recruiters in the industry. Managers in the Re-THINK-ing THINK: The Electric Car Company are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
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.
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.
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.
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.
Learning organization
- Canny Evs 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 Canny Evs is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Re-THINK-ing THINK: The Electric Car Company Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Superior customer experience
– The customer experience strategy of Canny Evs in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
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 -
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Re-THINK-ing THINK: The Electric Car Company, in the dynamic environment Canny Evs has struggled to respond to the nimble upstart competition. Canny Evs has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Lack of clear differentiation of Canny Evs products
– To increase the profitability and margins on the products, Canny Evs needs to provide more differentiated products than what it is currently offering in the marketplace.
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.
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.
High operating costs
– Compare to the competitors, firm in the HBR case study Re-THINK-ing THINK: The Electric Car Company 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 Canny Evs 's lucrative customers.
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.
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.
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.
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.
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 Canny Evs supply chain. Even after few cautionary changes mentioned in the HBR case study - Re-THINK-ing THINK: The Electric Car Company, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Canny Evs vulnerable to further global disruptions in South East Asia.
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.
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 -
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.
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.
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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Canny Evs 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.
Buying journey improvements
– Canny Evs can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Re-THINK-ing THINK: The Electric Car Company 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.
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.
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.
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.
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.
Creating value in data economy
– The success of analytics program of Canny Evs has opened avenues for new revenue streams for the organization in the industry. This can help Canny Evs to build a more holistic ecosystem as suggested in the Re-THINK-ing THINK: The Electric Car Company case study. Canny Evs can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
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. Canny Evs can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Developing new processes and practices
– Canny Evs 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.
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.
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 -
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.
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. Canny Evs can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
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.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Canny Evs with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Environmental challenges
– Canny Evs 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. Canny Evs can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
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.
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Canny Evs 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 Re-THINK-ing THINK: The Electric Car Company .
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 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.
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.
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.