Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence
Caterpillar Tunnelling Canada Corporation, a Toronto-based subsidiary of the U.S. company Caterpillar Inc., specializes in the custom design and manufacture of tunnelling boring machines used in the construction of transportation and utility tunnels such as subway, sewage and telecom cable tunnels. After the acquisition by Caterpillar, the company was chosen as one of the sites to undergo enterprise resource planning (ERP) transformation. After over a year of localization effort to adapt the corporate ERP template to the subsidiary's business processes, the project was called off due to both the strained local resources and the significant gap between the parent company's repetitive manufacturing model and the subsidiary's concurrent engineering/project-based model. Moreover, the lack of executive buy-in and a mandate in establishing company-wide performance metrics and consistency in business semantics led to sporadic user adoption of business intelligence tools and the creation of sometimes irreconcilable reporting. The business resource manager and head of finance has to rethink the management of business intelligence technologies and come up with a strategy to achieve coherent data analytics for effective business decision making. Authors Frances Leung and Murat Kristal are affiliated with York University.
Swot Analysis of "Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence" written by Frances Leung, Murat Kristal includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Tunnelling Caterpillar facing as an external strategic factors. Some of the topics covered in Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence case study are - Strategic Management Strategies, and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence casestudy better are - – there is increasing trade war between United States & China, wage bills are increasing, increasing household debt because of falling income levels, cloud computing is disrupting traditional business models, increasing transportation and logistics costs, supply chains are disrupted by pandemic , geopolitical disruptions,
increasing government debt because of Covid-19 spendings, there is backlash against globalization, etc
Introduction to SWOT Analysis of Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Tunnelling Caterpillar, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Tunnelling Caterpillar 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 Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence can be done for the following purposes –
1. Strategic planning using facts provided in Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence case study
2. Improving business portfolio management of Tunnelling Caterpillar
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 Tunnelling Caterpillar
Strengths Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Tunnelling Caterpillar in Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence Harvard Business Review case study are -
Analytics focus
– Tunnelling Caterpillar 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 Frances Leung, Murat Kristal 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.
High switching costs
– The high switching costs that Tunnelling Caterpillar 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.
High brand equity
– Tunnelling Caterpillar has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Tunnelling Caterpillar to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Superior customer experience
– The customer experience strategy of Tunnelling Caterpillar in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Tunnelling Caterpillar 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 Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Operational resilience
– The operational resilience strategy in the Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence 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.
Organizational Resilience of Tunnelling Caterpillar
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Tunnelling Caterpillar does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Learning organization
- Tunnelling Caterpillar 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 Tunnelling Caterpillar is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Low bargaining power of suppliers
– Suppliers of Tunnelling Caterpillar in the sector have low bargaining power. Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Tunnelling Caterpillar to manage not only supply disruptions but also source products at highly competitive prices.
Strong track record of project management
– Tunnelling Caterpillar 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
– Tunnelling Caterpillar 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 Tunnelling Caterpillar in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Cross disciplinary teams
– Horizontal connected teams at the Tunnelling Caterpillar 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.
Weaknesses Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence are -
High bargaining power of channel partners
– Because of the regulatory requirements, Frances Leung, Murat Kristal suggests that, Tunnelling Caterpillar 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence 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 Tunnelling Caterpillar has relatively successful track record of launching new products.
High cash cycle compare to competitors
Tunnelling Caterpillar 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.
Increasing silos among functional specialists
– The organizational structure of Tunnelling Caterpillar is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Tunnelling Caterpillar needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Tunnelling Caterpillar to focus more on services rather than just following the product oriented approach.
Need for greater diversity
– Tunnelling Caterpillar has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence, in the dynamic environment Tunnelling Caterpillar has struggled to respond to the nimble upstart competition. Tunnelling Caterpillar has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Tunnelling Caterpillar is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Interest costs
– Compare to the competition, Tunnelling Caterpillar 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence, is just above the industry average. Tunnelling Caterpillar needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Aligning sales with marketing
– It come across in the case study Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence 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 Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence can leverage the sales team experience to cultivate customer relationships as Tunnelling Caterpillar is planning to shift buying processes online.
Workers concerns about automation
– As automation is fast increasing in the segment, Tunnelling Caterpillar 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.
Opportunities Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence | 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 Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence are -
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 Tunnelling Caterpillar in the consumer business. Now Tunnelling Caterpillar can target international markets with far fewer capital restrictions requirements than the existing system.
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. Tunnelling Caterpillar 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. Tunnelling Caterpillar 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Tunnelling Caterpillar 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 Tunnelling Caterpillar to hire the very best people irrespective of their geographical location.
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. Tunnelling Caterpillar can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Better consumer reach
– The expansion of the 5G network will help Tunnelling Caterpillar to increase its market reach. Tunnelling Caterpillar 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.
Loyalty marketing
– Tunnelling Caterpillar 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.
Buying journey improvements
– Tunnelling Caterpillar can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence 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.
Leveraging digital technologies
– Tunnelling Caterpillar 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.
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 Tunnelling Caterpillar 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.
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. Tunnelling Caterpillar can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Developing new processes and practices
– Tunnelling Caterpillar 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.
Learning at scale
– Online learning technologies has now opened space for Tunnelling Caterpillar 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.
Using analytics as competitive advantage
– Tunnelling Caterpillar 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 Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Tunnelling Caterpillar to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence are -
Shortening product life cycle
– it is one of the major threat that Tunnelling Caterpillar is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, 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. Tunnelling Caterpillar 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence, Tunnelling Caterpillar 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 .
Environmental challenges
– Tunnelling Caterpillar 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. Tunnelling Caterpillar can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
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 Tunnelling Caterpillar.
Increasing wage structure of Tunnelling Caterpillar
– 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 Tunnelling Caterpillar.
Regulatory challenges
– Tunnelling Caterpillar 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Tunnelling Caterpillar with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Tunnelling Caterpillar business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Tunnelling Caterpillar 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.
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.
Technology acceleration in Forth Industrial Revolution
– Tunnelling Caterpillar has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Tunnelling Caterpillar 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.
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 Tunnelling Caterpillar in the Leadership & Managing People sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence 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 Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence 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 Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence 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 Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence 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 Caterpillar Tunnelling: Revitalizing User Adoption of Business Intelligence 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 Tunnelling Caterpillar needs to make to build a sustainable competitive advantage.
