BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION
The A-case begins with Tony Hayward's appointment as CEO of BP. Hayward was immediately faced with the challenge of convincing the board that he could streamline BP's cost structure, while at the same time addressing the other main issue facing the company, its safety record. One of the board's subcommittees, the safety, ethics and environment assurance committee (SEEAC), had the mandate to identify and mitigate significant non-financial risks and ensure the company achieved its goal of "no accidents, no harm to people, and no damage to the environment." Learning objectives: Strategic positioning in terms of risk and costs; setting strategic priorities; comparison competitors; managing the expectations of the board.
Swot Analysis of "BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION" written by Paul Strebel, Brian Rogers includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Hayward's Seeac facing as an external strategic factors. Some of the topics covered in BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION case study are - Strategic Management Strategies, Strategy and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION casestudy better are - – talent flight as more people leaving formal jobs, increasing transportation and logistics costs, increasing energy prices, technology disruption, digital marketing is dominated by two big players Facebook and Google, central banks are concerned over increasing inflation, cloud computing is disrupting traditional business models,
customer relationship management is fast transforming because of increasing concerns over data privacy, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Hayward's Seeac, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Hayward's Seeac 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 BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION can be done for the following purposes –
1. Strategic planning using facts provided in BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION case study
2. Improving business portfolio management of Hayward's Seeac
3. Assessing feasibility of the new initiative in Leadership & Managing People field.
4. Making a Leadership & Managing People topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Hayward's Seeac
Strengths BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Hayward's Seeac in BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION Harvard Business Review case study are -
Superior customer experience
– The customer experience strategy of Hayward's Seeac in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Low bargaining power of suppliers
– Suppliers of Hayward's Seeac in the sector have low bargaining power. BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Hayward's Seeac to manage not only supply disruptions but also source products at highly competitive prices.
Operational resilience
– The operational resilience strategy in the BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION 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.
Ability to recruit top talent
– Hayward's Seeac is one of the leading recruiters in the industry. Managers in the BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Organizational Resilience of Hayward's Seeac
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Hayward's Seeac does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– Hayward's Seeac has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION 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
– Hayward's Seeac 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 Paul Strebel, Brian Rogers 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.
Cross disciplinary teams
– Horizontal connected teams at the Hayward's Seeac 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 Hayward's Seeac 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.
Highly skilled collaborators
– Hayward's Seeac has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Hayward's Seeac digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Hayward's Seeac 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.
Strong track record of project management
– Hayward's Seeac is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION are -
High bargaining power of channel partners
– Because of the regulatory requirements, Paul Strebel, Brian Rogers suggests that, Hayward's Seeac 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Hayward's Seeac 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 dependence on star products
– The top 2 products and services of the firm as mentioned in the BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION 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 Hayward's Seeac has relatively successful track record of launching new products.
Slow decision making process
– As mentioned earlier in the report, Hayward's Seeac 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. Hayward's Seeac 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.
No frontier risks strategy
– After analyzing the HBR case study BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION, it seems that company is thinking about the frontier risks that can impact Leadership & Managing People 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 BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION, is just above the industry average. Hayward's Seeac 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 Hayward's Seeac supply chain. Even after few cautionary changes mentioned in the HBR case study - BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Hayward's Seeac vulnerable to further global disruptions in South East Asia.
Slow to strategic competitive environment developments
– As BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION HBR case study mentions - Hayward's Seeac 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.
Products dominated business model
– Even though Hayward's Seeac 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 - BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION should strive to include more intangible value offerings along with its core products and services.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Hayward's Seeac is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION, it seems that the employees of Hayward's Seeac 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.
Opportunities BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION | 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 BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Hayward's Seeac 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
– Hayward's Seeac can use the latest technology developments to improve its manufacturing and designing process in Leadership & Managing People 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Hayward's Seeac to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Hayward's Seeac to hire the very best people irrespective of their geographical location.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Leadership & Managing People industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Hayward's Seeac 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. Hayward's Seeac 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.
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 Hayward's Seeac 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.
Developing new processes and practices
– Hayward's Seeac can develop new processes and procedures in Leadership & Managing People 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Hayward's Seeac is facing challenges because of the dominance of functional experts in the organization. BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION 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, Hayward's Seeac 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.
Using analytics as competitive advantage
– Hayward's Seeac 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 BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Hayward's Seeac 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, Hayward's Seeac 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, BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Leadership & Managing People industry, but it has also influenced the consumer preferences. Hayward's Seeac can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Hayward's Seeac in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Leadership & Managing People segment, and it will provide faster access to the consumers.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Hayward's Seeac can use these opportunities to build new business models that can help the communities that Hayward's Seeac operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Threats BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION are -
Easy access to finance
– Easy access to finance in Leadership & Managing People field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Hayward's Seeac can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Hayward's Seeac.
Regulatory challenges
– Hayward's Seeac 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 Leadership & Managing People industry regulations.
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 Hayward's Seeac in the Leadership & Managing People sector and impact the bottomline of the organization.
Environmental challenges
– Hayward's Seeac 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. Hayward's Seeac can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Stagnating economy with rate increase
– Hayward's Seeac can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
High 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. Hayward's Seeac needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
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. Hayward's Seeac 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.
Technology acceleration in Forth Industrial Revolution
– Hayward's Seeac has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Hayward's Seeac needs to keep up with the evolution of technology in the Leadership & Managing People 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.
Increasing wage structure of Hayward's Seeac
– 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 Hayward's Seeac.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION, Hayward's Seeac may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Leadership & Managing People .
High dependence on third party suppliers
– Hayward's Seeac 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.
Consumer confidence and its impact on Hayward's Seeac 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.
Weighted SWOT Analysis of BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION 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 BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION 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 BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION 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 BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION 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 BRITISH PETROLEUM (A): DEFINING A STRATEGIC VISION 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 Hayward's Seeac needs to make to build a sustainable competitive advantage.