West Wacker Drive: To Build or Not to Build? SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of West Wacker Drive: To Build or Not to Build?
For best results, this case should be printed in color.In 1980, Thomas J. Klutznick, president of a Chicago-based development company, was considering whether he should build a Class A building on a second-rate site outside the Central Loop or not. He had a promising design, but the economic conditions, concurrent construction boom in other prime locations in Chicago Downtown, and high interest rates suggested he should think long and hard before committing the company's resources to this speculative undertaking.
Swot Analysis of "West Wacker Drive: To Build or Not to Build?" written by A. Eugene Kohn includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Chicago Klutznick facing as an external strategic factors. Some of the topics covered in West Wacker Drive: To Build or Not to Build? case study are - Strategic Management Strategies, and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the West Wacker Drive: To Build or Not to Build? casestudy better are - – talent flight as more people leaving formal jobs, there is backlash against globalization, digital marketing is dominated by two big players Facebook and Google, supply chains are disrupted by pandemic , increasing government debt because of Covid-19 spendings, increasing commodity prices, increasing energy prices,
challanges to central banks by blockchain based private currencies, technology disruption, etc
Introduction to SWOT Analysis of West Wacker Drive: To Build or Not to Build?
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in West Wacker Drive: To Build or Not to Build? case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Chicago Klutznick, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Chicago Klutznick 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 West Wacker Drive: To Build or Not to Build? can be done for the following purposes –
1. Strategic planning using facts provided in West Wacker Drive: To Build or Not to Build? case study
2. Improving business portfolio management of Chicago Klutznick
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 Chicago Klutznick
Strengths West Wacker Drive: To Build or Not to Build? | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Chicago Klutznick in West Wacker Drive: To Build or Not to Build? Harvard Business Review case study are -
Training and development
– Chicago Klutznick has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in West Wacker Drive: To Build or Not to Build? 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.
Sustainable margins compare to other players in Leadership & Managing People industry
– West Wacker Drive: To Build or Not to Build? firm has clearly differentiated products in the market place. This has enabled Chicago Klutznick to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Chicago Klutznick to invest into research and development (R&D) and innovation.
High brand equity
– Chicago Klutznick has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Chicago Klutznick to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– Chicago Klutznick is one of the most innovative firm in sector. Manager in West Wacker Drive: To Build or Not to Build? Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Strong track record of project management
– Chicago Klutznick is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to lead change in Leadership & Managing People field
– Chicago Klutznick 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 Chicago Klutznick in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Learning organization
- Chicago Klutznick 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 Chicago Klutznick is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in West Wacker Drive: To Build or Not to Build? Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Chicago Klutznick is present in almost all the verticals within the industry. This has provided firm in West Wacker Drive: To Build or Not to Build? 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.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Chicago Klutznick digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Chicago Klutznick 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.
Operational resilience
– The operational resilience strategy in the West Wacker Drive: To Build or Not to Build? 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.
Low bargaining power of suppliers
– Suppliers of Chicago Klutznick in the sector have low bargaining power. West Wacker Drive: To Build or Not to Build? has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Chicago Klutznick to manage not only supply disruptions but also source products at highly competitive prices.
Effective Research and Development (R&D)
– Chicago Klutznick 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 West Wacker Drive: To Build or Not to Build? - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses West Wacker Drive: To Build or Not to Build? | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of West Wacker Drive: To Build or Not to Build? are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Chicago Klutznick is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study West Wacker Drive: To Build or Not to Build? can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
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 Chicago Klutznick supply chain. Even after few cautionary changes mentioned in the HBR case study - West Wacker Drive: To Build or Not to Build?, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Chicago Klutznick vulnerable to further global disruptions in South East Asia.
Slow decision making process
– As mentioned earlier in the report, Chicago Klutznick 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. Chicago Klutznick 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 West Wacker Drive: To Build or Not to Build?, 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.
Low market penetration in new markets
– Outside its home market of Chicago Klutznick, firm in the HBR case study West Wacker Drive: To Build or Not to Build? needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High cash cycle compare to competitors
Chicago Klutznick 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study West Wacker Drive: To Build or Not to Build?, it seems that the employees of Chicago Klutznick don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Slow to strategic competitive environment developments
– As West Wacker Drive: To Build or Not to Build? HBR case study mentions - Chicago Klutznick 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, Chicago Klutznick 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.
Skills based hiring
– The stress on hiring functional specialists at Chicago Klutznick has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study West Wacker Drive: To Build or Not to Build?, in the dynamic environment Chicago Klutznick has struggled to respond to the nimble upstart competition. Chicago Klutznick has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Opportunities West Wacker Drive: To Build or Not to Build? | 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 West Wacker Drive: To Build or Not to Build? are -
Using analytics as competitive advantage
– Chicago Klutznick 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 West Wacker Drive: To Build or Not to Build? - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Chicago Klutznick to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Chicago Klutznick 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. Chicago Klutznick 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.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Chicago Klutznick in the consumer business. Now Chicago Klutznick can target international markets with far fewer capital restrictions requirements than the existing system.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Chicago Klutznick can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Chicago Klutznick 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, Chicago Klutznick can use these opportunities to build new business models that can help the communities that Chicago Klutznick operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Low interest rates
– Even though inflation is raising its head in most developed economies, Chicago Klutznick 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, Chicago Klutznick is facing challenges because of the dominance of functional experts in the organization. West Wacker Drive: To Build or Not to Build? 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.
Leveraging digital technologies
– Chicago Klutznick 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.
Developing new processes and practices
– Chicago Klutznick 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.
Better consumer reach
– The expansion of the 5G network will help Chicago Klutznick to increase its market reach. Chicago Klutznick 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.
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. Chicago Klutznick can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Creating value in data economy
– The success of analytics program of Chicago Klutznick has opened avenues for new revenue streams for the organization in the industry. This can help Chicago Klutznick to build a more holistic ecosystem as suggested in the West Wacker Drive: To Build or Not to Build? case study. Chicago Klutznick can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats West Wacker Drive: To Build or Not to Build? External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study West Wacker Drive: To Build or Not to Build? are -
Regulatory challenges
– Chicago Klutznick 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Chicago Klutznick 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 West Wacker Drive: To Build or Not to Build? .
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. Chicago Klutznick needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
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.
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 Chicago Klutznick business can come under increasing regulations regarding data privacy, data security, etc.
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. Chicago Klutznick 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.
Shortening product life cycle
– it is one of the major threat that Chicago Klutznick is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Chicago Klutznick in the Leadership & Managing People industry. The Leadership & Managing People industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Stagnating economy with rate increase
– Chicago Klutznick 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.
Increasing wage structure of Chicago Klutznick
– 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 Chicago Klutznick.
Consumer confidence and its impact on Chicago Klutznick 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.
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 Chicago Klutznick.
Environmental challenges
– Chicago Klutznick 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. Chicago Klutznick can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Weighted SWOT Analysis of West Wacker Drive: To Build or Not to Build? 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 West Wacker Drive: To Build or Not to Build? 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 West Wacker Drive: To Build or Not to Build? 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 West Wacker Drive: To Build or Not to Build? 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 West Wacker Drive: To Build or Not to Build? 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 Chicago Klutznick needs to make to build a sustainable competitive advantage.
