The InnoCar Project - Developing a Chip for the Future Automobile (E): Epilogue 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 (E): Epilogue
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 (E): Epilogue" 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 (E): Epilogue 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 (E): Epilogue casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, there is increasing trade war between United States & China, challanges to central banks by blockchain based private currencies, increasing commodity prices, technology disruption, wage bills are increasing, central banks are concerned over increasing inflation,
talent flight as more people leaving formal jobs, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of The InnoCar Project - Developing a Chip for the Future Automobile (E): Epilogue
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 (E): Epilogue 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 (E): Epilogue can be done for the following purposes –
1. Strategic planning using facts provided in The InnoCar Project - Developing a Chip for the Future Automobile (E): Epilogue 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 (E): Epilogue | 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 (E): Epilogue Harvard Business Review case study are -
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 (E): Epilogue HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
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.
High brand equity
– Chip Automobile has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Chip Automobile to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Training and development
– Chip Automobile has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in The InnoCar Project - Developing a Chip for the Future Automobile (E): Epilogue Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Sustainable margins compare to other players in Leadership & Managing People industry
– The InnoCar Project - Developing a Chip for the Future Automobile (E): Epilogue 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.
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.
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.
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.
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 (E): Epilogue 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.
Organizational Resilience of Chip Automobile
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Chip Automobile does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
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 (E): Epilogue Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
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 (E): Epilogue Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses The InnoCar Project - Developing a Chip for the Future Automobile (E): Epilogue | 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 (E): Epilogue are -
Slow to strategic competitive environment developments
– As The InnoCar Project - Developing a Chip for the Future Automobile (E): Epilogue 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.
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.
Increasing silos among functional specialists
– The organizational structure of Chip Automobile is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Chip Automobile needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Chip Automobile to focus more on services rather than just following the product oriented approach.
No frontier risks strategy
– After analyzing the HBR case study The InnoCar Project - Developing a Chip for the Future Automobile (E): Epilogue, it seems that company is thinking about the frontier risks that can impact Leadership & Managing People strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study The InnoCar Project - Developing a Chip for the Future Automobile (E): Epilogue, it seems that the employees of Chip Automobile 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.
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.
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 (E): Epilogue 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.
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.
Interest costs
– Compare to the competition, Chip Automobile 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.
Low market penetration in new markets
– Outside its home market of Chip Automobile, firm in the HBR case study The InnoCar Project - Developing a Chip for the Future Automobile (E): Epilogue needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High bargaining power of channel partners
– Because of the regulatory requirements, Kim Van Oorschot, Kishore Sengupta suggests that, Chip Automobile 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.
Opportunities The InnoCar Project - Developing a Chip for the Future Automobile (E): Epilogue | 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 (E): Epilogue are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Chip Automobile 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, The InnoCar Project - Developing a Chip for the Future Automobile (E): Epilogue, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Chip Automobile 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. Chip Automobile 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.
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 Chip Automobile 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.
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.
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.
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 (E): Epilogue - 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.
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.
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.
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. Chip Automobile can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Creating value in data economy
– The success of analytics program of 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 (E): Epilogue case study. Chip Automobile can build new products and services such as - data insight services, data privacy related products, data based consulting services, 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Chip Automobile 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.
Threats The InnoCar Project - Developing a Chip for the Future Automobile (E): Epilogue 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 (E): Epilogue are -
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.
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.
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 Chip Automobile.
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.
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.
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.
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.
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.
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.
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.
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.
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Chip Automobile 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.
Weighted SWOT Analysis of The InnoCar Project - Developing a Chip for the Future Automobile (E): Epilogue 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 (E): Epilogue 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 (E): Epilogue 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 (E): Epilogue 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 (E): Epilogue 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.