Case Study Description of AltaGas Ltd.: Forrest Kerr Hydroelectric Project
AltaGas Ltd. (AltaGas), an energy company based in Calgary, Alberta, successfully collaborated with the Canadian federal government, British Columbia's provincial government, and a First Nations group to reach an agreement for constructing a large, green energy, hydroelectric project in a remote location in northern British Columbia. Although most observers considered the agreement to be a resounding success, the founder and chief executive officer of AltaGas worried that the hardest work was yet to come. Believing that success could be measured only in terms of social value, he wondered how the project could sustain positive community impact for the entire 60-year duration of the commercial agreement.
Swot Analysis of "AltaGas Ltd.: Forrest Kerr Hydroelectric Project" written by Gerard Seijts, Karen MacMillan includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Altagas Hydroelectric facing as an external strategic factors. Some of the topics covered in AltaGas Ltd.: Forrest Kerr Hydroelectric Project case study are - Strategic Management Strategies, Negotiations, Sustainability and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the AltaGas Ltd.: Forrest Kerr Hydroelectric Project casestudy better are - – increasing energy prices, customer relationship management is fast transforming because of increasing concerns over data privacy, wage bills are increasing, increasing transportation and logistics costs, there is increasing trade war between United States & China, cloud computing is disrupting traditional business models, increasing commodity prices,
talent flight as more people leaving formal jobs, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of AltaGas Ltd.: Forrest Kerr Hydroelectric Project
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in AltaGas Ltd.: Forrest Kerr Hydroelectric Project case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Altagas Hydroelectric, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Altagas Hydroelectric 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 AltaGas Ltd.: Forrest Kerr Hydroelectric Project can be done for the following purposes –
1. Strategic planning using facts provided in AltaGas Ltd.: Forrest Kerr Hydroelectric Project case study
2. Improving business portfolio management of Altagas Hydroelectric
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 Altagas Hydroelectric
Strengths AltaGas Ltd.: Forrest Kerr Hydroelectric Project | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Altagas Hydroelectric in AltaGas Ltd.: Forrest Kerr Hydroelectric Project Harvard Business Review case study are -
Diverse revenue streams
– Altagas Hydroelectric is present in almost all the verticals within the industry. This has provided firm in AltaGas Ltd.: Forrest Kerr Hydroelectric Project 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.
Cross disciplinary teams
– Horizontal connected teams at the Altagas Hydroelectric 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.
Operational resilience
– The operational resilience strategy in the AltaGas Ltd.: Forrest Kerr Hydroelectric Project 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.
Successful track record of launching new products
– Altagas Hydroelectric has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Altagas Hydroelectric 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.
Training and development
– Altagas Hydroelectric has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in AltaGas Ltd.: Forrest Kerr Hydroelectric Project 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.
Highly skilled collaborators
– Altagas Hydroelectric 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 AltaGas Ltd.: Forrest Kerr Hydroelectric Project HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of Altagas Hydroelectric
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Altagas Hydroelectric does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Altagas Hydroelectric is one of the leading recruiters in the industry. Managers in the AltaGas Ltd.: Forrest Kerr Hydroelectric Project are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Strong track record of project management
– Altagas Hydroelectric 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 Altagas Hydroelectric has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Low bargaining power of suppliers
– Suppliers of Altagas Hydroelectric in the sector have low bargaining power. AltaGas Ltd.: Forrest Kerr Hydroelectric Project has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Altagas Hydroelectric to manage not only supply disruptions but also source products at highly competitive prices.
Analytics focus
– Altagas Hydroelectric 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 Gerard Seijts, Karen MacMillan 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 AltaGas Ltd.: Forrest Kerr Hydroelectric Project | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of AltaGas Ltd.: Forrest Kerr Hydroelectric Project are -
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 Altagas Hydroelectric supply chain. Even after few cautionary changes mentioned in the HBR case study - AltaGas Ltd.: Forrest Kerr Hydroelectric Project, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Altagas Hydroelectric vulnerable to further global disruptions in South East Asia.
Interest costs
– Compare to the competition, Altagas Hydroelectric 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.
High cash cycle compare to competitors
Altagas Hydroelectric 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.
Slow to strategic competitive environment developments
– As AltaGas Ltd.: Forrest Kerr Hydroelectric Project HBR case study mentions - Altagas Hydroelectric 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, Altagas Hydroelectric is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study AltaGas Ltd.: Forrest Kerr Hydroelectric Project can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Need for greater diversity
– Altagas Hydroelectric 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.
Aligning sales with marketing
– It come across in the case study AltaGas Ltd.: Forrest Kerr Hydroelectric Project 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 AltaGas Ltd.: Forrest Kerr Hydroelectric Project can leverage the sales team experience to cultivate customer relationships as Altagas Hydroelectric is planning to shift buying processes online.
Slow decision making process
– As mentioned earlier in the report, Altagas Hydroelectric 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. Altagas Hydroelectric 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 Altagas Hydroelectric 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.
No frontier risks strategy
– After analyzing the HBR case study AltaGas Ltd.: Forrest Kerr Hydroelectric Project, 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Altagas Hydroelectric 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 AltaGas Ltd.: Forrest Kerr Hydroelectric Project | 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 AltaGas Ltd.: Forrest Kerr Hydroelectric Project are -
Leveraging digital technologies
– Altagas Hydroelectric 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Altagas Hydroelectric 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, AltaGas Ltd.: Forrest Kerr Hydroelectric Project, 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. Altagas Hydroelectric 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. Altagas Hydroelectric 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.
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. Altagas Hydroelectric can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 Altagas Hydroelectric 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.
Learning at scale
– Online learning technologies has now opened space for Altagas Hydroelectric 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Altagas Hydroelectric is facing challenges because of the dominance of functional experts in the organization. AltaGas Ltd.: Forrest Kerr Hydroelectric Project case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Buying journey improvements
– Altagas Hydroelectric can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. AltaGas Ltd.: Forrest Kerr Hydroelectric Project 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Altagas Hydroelectric can use these opportunities to build new business models that can help the communities that Altagas Hydroelectric operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Better consumer reach
– The expansion of the 5G network will help Altagas Hydroelectric to increase its market reach. Altagas Hydroelectric 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
– Altagas Hydroelectric 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.
Creating value in data economy
– The success of analytics program of Altagas Hydroelectric has opened avenues for new revenue streams for the organization in the industry. This can help Altagas Hydroelectric to build a more holistic ecosystem as suggested in the AltaGas Ltd.: Forrest Kerr Hydroelectric Project case study. Altagas Hydroelectric can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at Altagas Hydroelectric can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Leadership & Managing People segment.
Threats AltaGas Ltd.: Forrest Kerr Hydroelectric Project External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study AltaGas Ltd.: Forrest Kerr Hydroelectric Project are -
Consumer confidence and its impact on Altagas Hydroelectric 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.
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.
Environmental challenges
– Altagas Hydroelectric 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. Altagas Hydroelectric can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Increasing wage structure of Altagas Hydroelectric
– 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 Altagas Hydroelectric.
High dependence on third party suppliers
– Altagas Hydroelectric high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Altagas Hydroelectric 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 Altagas Hydroelectric.
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. Altagas Hydroelectric needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Regulatory challenges
– Altagas Hydroelectric 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Altagas Hydroelectric can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study AltaGas Ltd.: Forrest Kerr Hydroelectric Project .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Altagas Hydroelectric 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.
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. Altagas Hydroelectric 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Altagas Hydroelectric with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Weighted SWOT Analysis of AltaGas Ltd.: Forrest Kerr Hydroelectric Project 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 AltaGas Ltd.: Forrest Kerr Hydroelectric Project 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 AltaGas Ltd.: Forrest Kerr Hydroelectric Project 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 AltaGas Ltd.: Forrest Kerr Hydroelectric Project 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 AltaGas Ltd.: Forrest Kerr Hydroelectric Project 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 Altagas Hydroelectric needs to make to build a sustainable competitive advantage.