The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction
The case tracks a large project for developing a chip for automobile entertainment systems. Participants evaluate the project's continuing progress and viability through three episodes. The case holds important lessons for evaluating complex new product development projects that lack visibility, as well as the efficacy of stage gates for monitoring such projects.
Swot Analysis of "The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction" written by Kim Van Oorschot, Kishore Sengupta includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Chip Automobile facing as an external strategic factors. Some of the topics covered in The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction case study are - Strategic Management Strategies, Technology and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction casestudy better are - – cloud computing is disrupting traditional business models, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing household debt because of falling income levels, increasing commodity prices, increasing inequality as vast percentage of new income is going to the top 1%, central banks are concerned over increasing inflation, increasing government debt because of Covid-19 spendings,
technology disruption, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Chip Automobile, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Chip Automobile 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 The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction can be done for the following purposes –
1. Strategic planning using facts provided in The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction case study
2. Improving business portfolio management of Chip Automobile
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 Chip Automobile
Strengths The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Chip Automobile in The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction Harvard Business Review case study are -
Strong track record of project management
– Chip Automobile is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High switching costs
– The high switching costs that Chip Automobile 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.
Operational resilience
– The operational resilience strategy in the The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction 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.
Learning organization
- Chip Automobile 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 Chip Automobile is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Highly skilled collaborators
– Chip Automobile 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 The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– Chip Automobile has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Chip Automobile 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.
Innovation driven organization
– Chip Automobile is one of the most innovative firm in sector. Manager in The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Chip Automobile digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Chip Automobile 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.
Low bargaining power of suppliers
– Suppliers of Chip Automobile in the sector have low bargaining power. The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Chip Automobile to manage not only supply disruptions but also source products at highly competitive prices.
Sustainable margins compare to other players in Leadership & Managing People industry
– The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction firm has clearly differentiated products in the market place. This has enabled Chip Automobile to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Chip Automobile to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Chip Automobile 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.
Analytics focus
– Chip Automobile 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 Kim Van Oorschot, Kishore Sengupta 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.
Weaknesses The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction are -
Need for greater diversity
– Chip Automobile 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction 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 Chip Automobile has relatively successful track record of launching new products.
Workers concerns about automation
– As automation is fast increasing in the segment, Chip Automobile 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.
Lack of clear differentiation of Chip Automobile products
– To increase the profitability and margins on the products, Chip Automobile needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow decision making process
– As mentioned earlier in the report, Chip Automobile 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. Chip Automobile 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.
Skills based hiring
– The stress on hiring functional specialists at Chip Automobile 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.
Aligning sales with marketing
– It come across in the case study The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction 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 The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction can leverage the sales team experience to cultivate customer relationships as Chip Automobile is planning to shift buying processes online.
Slow to strategic competitive environment developments
– As The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction HBR case study mentions - Chip Automobile 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Chip Automobile is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction 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 Chip Automobile supply chain. Even after few cautionary changes mentioned in the HBR case study - The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Chip Automobile vulnerable to further global disruptions in South East Asia.
High cash cycle compare to competitors
Chip Automobile 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.
Opportunities The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction | 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 The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction 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 Chip Automobile in the consumer business. Now Chip Automobile can target international markets with far fewer capital restrictions requirements than the existing system.
Learning at scale
– Online learning technologies has now opened space for Chip Automobile 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.
Developing new processes and practices
– Chip Automobile 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Chip Automobile can use these opportunities to build new business models that can help the communities that Chip Automobile operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Buying journey improvements
– Chip Automobile can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction 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.
Using analytics as competitive advantage
– Chip Automobile 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 The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Chip Automobile to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Low interest rates
– Even though inflation is raising its head in most developed economies, Chip Automobile 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.
Better consumer reach
– The expansion of the 5G network will help Chip Automobile to increase its market reach. Chip Automobile 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Chip Automobile can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Chip Automobile 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 Chip Automobile to hire the very best people irrespective of their geographical location.
Creating value in data economy
– The success of analytics program of Chip Automobile has opened avenues for new revenue streams for the organization in the industry. This can help Chip Automobile to build a more holistic ecosystem as suggested in the The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction case study. Chip Automobile can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
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. Chip Automobile can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Leveraging digital technologies
– Chip Automobile 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.
Threats The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Chip Automobile with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing wage structure of Chip Automobile
– 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 Chip Automobile.
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 Chip Automobile business can come under increasing regulations regarding data privacy, data security, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction, Chip Automobile 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 .
Shortening product life cycle
– it is one of the major threat that Chip Automobile is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Consumer confidence and its impact on Chip Automobile 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.
Technology acceleration in Forth Industrial Revolution
– Chip Automobile has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Chip Automobile 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 Chip Automobile in the Leadership & Managing People sector and impact the bottomline of the organization.
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. Chip Automobile 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.
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. Chip Automobile needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Easy access to finance
– Easy access to finance in Leadership & Managing People field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Chip Automobile can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Regulatory challenges
– Chip Automobile 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.
Environmental challenges
– Chip Automobile 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. Chip Automobile can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Weighted SWOT Analysis of The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction 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 The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction 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 The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction 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 The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction 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 The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction 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 Chip Automobile needs to make to build a sustainable competitive advantage.
Feel free to connect with us if you need business research.
You can download Excel Template of Case Study Solution & Analysis of The InnoCar Project - Developing a Chip for the Future Automobile (A): Introduction
