Case Study Description of WeaveTech: High Performance Change
WeaveTech, formerly Johnson-Ware, is a clothing company that produces jackets, coats, overalls, coveralls, and fire-resistant clothing for the military. A private equity firm renamed the company after it acquired Johnson-Ware several years ago. WeaveTech now faces a changing market, and its new CEO is planning to change its strategy. As part of this strategy, the CEO wants to cut the number of WeaveTech managers by 20%. He asks Frank Jennings, WeaveTeach's VP for Human Resources, to recommend how to do so. Jennings has done his best to balance these changes with the company's long history, its small-town culture, and its high-performance culture. The case presents information on the implicit lifetime employment contract, a significant change in strategic direction, and a problematic performance appraisal system. Jennings finds the decision to reduce headcount to be challenging. Is it ethical to discharge high-performing managers? Is the new strategy sound? How should Jennings respond to the managerial reduction mandate, and what should he recommend to the board?
Swot Analysis of "WeaveTech: High Performance Change" written by Michael Beer, Paul Swiercz includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Jennings Weavetech facing as an external strategic factors. Some of the topics covered in WeaveTech: High Performance Change case study are - Strategic Management Strategies, Change management, Compensation and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the WeaveTech: High Performance Change casestudy better are - – there is backlash against globalization, increasing government debt because of Covid-19 spendings, increasing commodity prices, wage bills are increasing, digital marketing is dominated by two big players Facebook and Google, supply chains are disrupted by pandemic , cloud computing is disrupting traditional business models,
increasing household debt because of falling income levels, banking and financial system is disrupted by Bitcoin and other crypto currencies, etc
Introduction to SWOT Analysis of WeaveTech: High Performance Change
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in WeaveTech: High Performance Change case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Jennings Weavetech, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Jennings Weavetech 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 WeaveTech: High Performance Change can be done for the following purposes –
1. Strategic planning using facts provided in WeaveTech: High Performance Change case study
2. Improving business portfolio management of Jennings Weavetech
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 Jennings Weavetech
Strengths WeaveTech: High Performance Change | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Jennings Weavetech in WeaveTech: High Performance Change Harvard Business Review case study are -
High switching costs
– The high switching costs that Jennings Weavetech 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.
Superior customer experience
– The customer experience strategy of Jennings Weavetech in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Jennings Weavetech digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Jennings Weavetech 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.
Sustainable margins compare to other players in Leadership & Managing People industry
– WeaveTech: High Performance Change firm has clearly differentiated products in the market place. This has enabled Jennings Weavetech to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Jennings Weavetech to invest into research and development (R&D) and innovation.
Analytics focus
– Jennings Weavetech 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 Michael Beer, Paul Swiercz 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.
Training and development
– Jennings Weavetech has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in WeaveTech: High Performance Change 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.
Innovation driven organization
– Jennings Weavetech is one of the most innovative firm in sector. Manager in WeaveTech: High Performance Change 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
– Jennings Weavetech is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Highly skilled collaborators
– Jennings Weavetech 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 WeaveTech: High Performance Change HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to recruit top talent
– Jennings Weavetech is one of the leading recruiters in the industry. Managers in the WeaveTech: High Performance Change are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Cross disciplinary teams
– Horizontal connected teams at the Jennings Weavetech 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.
Diverse revenue streams
– Jennings Weavetech is present in almost all the verticals within the industry. This has provided firm in WeaveTech: High Performance Change 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.
Weaknesses WeaveTech: High Performance Change | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of WeaveTech: High Performance Change are -
Aligning sales with marketing
– It come across in the case study WeaveTech: High Performance Change 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 WeaveTech: High Performance Change can leverage the sales team experience to cultivate customer relationships as Jennings Weavetech is planning to shift buying processes online.
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 Jennings Weavetech supply chain. Even after few cautionary changes mentioned in the HBR case study - WeaveTech: High Performance Change, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Jennings Weavetech vulnerable to further global disruptions in South East Asia.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study WeaveTech: High Performance Change, is just above the industry average. Jennings Weavetech 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 operating costs
– Compare to the competitors, firm in the HBR case study WeaveTech: High Performance Change 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 Jennings Weavetech 's lucrative customers.
High bargaining power of channel partners
– Because of the regulatory requirements, Michael Beer, Paul Swiercz suggests that, Jennings Weavetech 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study WeaveTech: High Performance Change, it seems that the employees of Jennings Weavetech 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.
Interest costs
– Compare to the competition, Jennings Weavetech 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.
Slow to strategic competitive environment developments
– As WeaveTech: High Performance Change HBR case study mentions - Jennings Weavetech 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.
Skills based hiring
– The stress on hiring functional specialists at Jennings Weavetech 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the WeaveTech: High Performance Change 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 Jennings Weavetech has relatively successful track record of launching new products.
Slow decision making process
– As mentioned earlier in the report, Jennings Weavetech 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. Jennings Weavetech 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.
Opportunities WeaveTech: High Performance Change | 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 WeaveTech: High Performance Change are -
Using analytics as competitive advantage
– Jennings Weavetech 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 WeaveTech: High Performance Change - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Jennings Weavetech 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, Jennings Weavetech 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, WeaveTech: High Performance Change, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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 Jennings Weavetech 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.
Leveraging digital technologies
– Jennings Weavetech 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 Jennings Weavetech has opened avenues for new revenue streams for the organization in the industry. This can help Jennings Weavetech to build a more holistic ecosystem as suggested in the WeaveTech: High Performance Change case study. Jennings Weavetech can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Developing new processes and practices
– Jennings Weavetech 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.
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. Jennings Weavetech can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Jennings Weavetech can use these opportunities to build new business models that can help the communities that Jennings Weavetech operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Jennings Weavetech 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 Jennings Weavetech 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Jennings Weavetech 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 Jennings Weavetech to hire the very best people irrespective of their geographical location.
Better consumer reach
– The expansion of the 5G network will help Jennings Weavetech to increase its market reach. Jennings Weavetech 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Jennings Weavetech 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.
Threats WeaveTech: High Performance Change External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study WeaveTech: High Performance Change are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study WeaveTech: High Performance Change, Jennings Weavetech 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 .
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.
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 Jennings Weavetech business can come under increasing regulations regarding data privacy, data security, etc.
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 Jennings Weavetech in the Leadership & Managing People sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Jennings Weavetech 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.
Environmental challenges
– Jennings Weavetech 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. Jennings Weavetech can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Stagnating economy with rate increase
– Jennings Weavetech 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 Jennings Weavetech
– 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 Jennings Weavetech.
Consumer confidence and its impact on Jennings Weavetech 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.
Regulatory challenges
– Jennings Weavetech 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Jennings Weavetech 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.
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
– Jennings Weavetech has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Jennings Weavetech 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.
Weighted SWOT Analysis of WeaveTech: High Performance Change 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 WeaveTech: High Performance Change 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 WeaveTech: High Performance Change 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 WeaveTech: High Performance Change 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 WeaveTech: High Performance Change 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 Jennings Weavetech needs to make to build a sustainable competitive advantage.