Swot Analysis of "AES Corporation (B): Global Sourcing Initiative" written by Timothy M. Laseter, Rajiv Ranjan includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Uv3547 Meters facing as an external strategic factors. Some of the topics covered in AES Corporation (B): Global Sourcing Initiative case study are - Strategic Management Strategies, Communication and Communication.
Some of the macro environment factors that can be used to understand the AES Corporation (B): Global Sourcing Initiative casestudy better are - – increasing commodity prices, increasing government debt because of Covid-19 spendings, central banks are concerned over increasing inflation, geopolitical disruptions, banking and financial system is disrupted by Bitcoin and other crypto currencies, technology disruption, talent flight as more people leaving formal jobs,
increasing household debt because of falling income levels, there is backlash against globalization, etc
Introduction to SWOT Analysis of AES Corporation (B): Global Sourcing Initiative
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in AES Corporation (B): Global Sourcing Initiative case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Uv3547 Meters, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Uv3547 Meters 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 AES Corporation (B): Global Sourcing Initiative can be done for the following purposes –
1. Strategic planning using facts provided in AES Corporation (B): Global Sourcing Initiative case study
2. Improving business portfolio management of Uv3547 Meters
3. Assessing feasibility of the new initiative in Communication field.
4. Making a Communication topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Uv3547 Meters
Strengths AES Corporation (B): Global Sourcing Initiative | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Uv3547 Meters in AES Corporation (B): Global Sourcing Initiative Harvard Business Review case study are -
Ability to recruit top talent
– Uv3547 Meters is one of the leading recruiters in the industry. Managers in the AES Corporation (B): Global Sourcing Initiative are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
High switching costs
– The high switching costs that Uv3547 Meters 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.
Low bargaining power of suppliers
– Suppliers of Uv3547 Meters in the sector have low bargaining power. AES Corporation (B): Global Sourcing Initiative has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Uv3547 Meters to manage not only supply disruptions but also source products at highly competitive prices.
Diverse revenue streams
– Uv3547 Meters is present in almost all the verticals within the industry. This has provided firm in AES Corporation (B): Global Sourcing Initiative 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.
Successful track record of launching new products
– Uv3547 Meters has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Uv3547 Meters 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.
Digital Transformation in Communication segment
- digital transformation varies from industry to industry. For Uv3547 Meters digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Uv3547 Meters 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.
Organizational Resilience of Uv3547 Meters
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Uv3547 Meters does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Highly skilled collaborators
– Uv3547 Meters 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 AES Corporation (B): Global Sourcing Initiative HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Sustainable margins compare to other players in Communication industry
– AES Corporation (B): Global Sourcing Initiative firm has clearly differentiated products in the market place. This has enabled Uv3547 Meters to fetch slight price premium compare to the competitors in the Communication industry. The sustainable margins have also helped Uv3547 Meters to invest into research and development (R&D) and innovation.
Effective Research and Development (R&D)
– Uv3547 Meters 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 AES Corporation (B): Global Sourcing Initiative - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Strong track record of project management
– Uv3547 Meters is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Learning organization
- Uv3547 Meters 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 Uv3547 Meters is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in AES Corporation (B): Global Sourcing Initiative Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses AES Corporation (B): Global Sourcing Initiative | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of AES Corporation (B): Global Sourcing Initiative are -
Aligning sales with marketing
– It come across in the case study AES Corporation (B): Global Sourcing Initiative 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 AES Corporation (B): Global Sourcing Initiative can leverage the sales team experience to cultivate customer relationships as Uv3547 Meters is planning to shift buying processes online.
Slow decision making process
– As mentioned earlier in the report, Uv3547 Meters 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. Uv3547 Meters 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 AES Corporation (B): Global Sourcing Initiative, it seems that company is thinking about the frontier risks that can impact Communication 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 AES Corporation (B): Global Sourcing Initiative, is just above the industry average. Uv3547 Meters 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Uv3547 Meters is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study AES Corporation (B): Global Sourcing Initiative 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 operating costs
– Compare to the competitors, firm in the HBR case study AES Corporation (B): Global Sourcing Initiative 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 Uv3547 Meters 's lucrative customers.
High cash cycle compare to competitors
Uv3547 Meters 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 AES Corporation (B): Global Sourcing Initiative, it seems that the employees of Uv3547 Meters 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 AES Corporation (B): Global Sourcing Initiative HBR case study mentions - Uv3547 Meters 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 Uv3547 Meters 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 - AES Corporation (B): Global Sourcing Initiative should strive to include more intangible value offerings along with its core products and services.
Interest costs
– Compare to the competition, Uv3547 Meters has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Opportunities AES Corporation (B): Global Sourcing Initiative | 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 AES Corporation (B): Global Sourcing Initiative are -
Leveraging digital technologies
– Uv3547 Meters 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.
Creating value in data economy
– The success of analytics program of Uv3547 Meters has opened avenues for new revenue streams for the organization in the industry. This can help Uv3547 Meters to build a more holistic ecosystem as suggested in the AES Corporation (B): Global Sourcing Initiative case study. Uv3547 Meters can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
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 Uv3547 Meters 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Uv3547 Meters in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Communication segment, and it will provide faster access to the consumers.
Low interest rates
– Even though inflation is raising its head in most developed economies, Uv3547 Meters 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.
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. Uv3547 Meters can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Developing new processes and practices
– Uv3547 Meters can develop new processes and procedures in Communication 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.
Loyalty marketing
– Uv3547 Meters has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Uv3547 Meters 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 Uv3547 Meters to hire the very best people irrespective of their geographical location.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Uv3547 Meters 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, AES Corporation (B): Global Sourcing Initiative, 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 Uv3547 Meters 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 Communication segment.
Buying journey improvements
– Uv3547 Meters can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. AES Corporation (B): Global Sourcing Initiative 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Communication industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Uv3547 Meters 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. Uv3547 Meters 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.
Threats AES Corporation (B): Global Sourcing Initiative External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study AES Corporation (B): Global Sourcing Initiative are -
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.
Technology acceleration in Forth Industrial Revolution
– Uv3547 Meters has witnessed rapid integration of technology during Covid-19 in the Communication industry. As one of the leading players in the industry, Uv3547 Meters needs to keep up with the evolution of technology in the Communication 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Uv3547 Meters in the Communication industry. The Communication 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Uv3547 Meters 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 AES Corporation (B): Global Sourcing Initiative .
Easy access to finance
– Easy access to finance in Communication field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Uv3547 Meters can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
High dependence on third party suppliers
– Uv3547 Meters 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.
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 Uv3547 Meters in the Communication sector and impact the bottomline of the organization.
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. Uv3547 Meters needs to understand the core reasons impacting the Communication industry. This will help it in building a better workplace.
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 Uv3547 Meters business can come under increasing regulations regarding data privacy, data security, etc.
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 Uv3547 Meters.
Regulatory challenges
– Uv3547 Meters 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 Communication industry regulations.
Increasing wage structure of Uv3547 Meters
– 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 Uv3547 Meters.
Shortening product life cycle
– it is one of the major threat that Uv3547 Meters is facing in Communication sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of AES Corporation (B): Global Sourcing Initiative 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 AES Corporation (B): Global Sourcing Initiative 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 AES Corporation (B): Global Sourcing Initiative 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 AES Corporation (B): Global Sourcing Initiative 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 AES Corporation (B): Global Sourcing Initiative 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 Uv3547 Meters needs to make to build a sustainable competitive advantage.