Montana Plastic Inc.: The Shelby Division in 2014 SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Montana Plastic Inc.: The Shelby Division in 2014
In May 2014, the newly installed director of global operations for Montana Plastic's Shelby Division, a producer of plastic gasoline tanks for global automotive brands such as General Motors, Ford and Toyota, is trying to turn the division around as it is suffering waste rates of 30 per cent. At the same time, topline growth is slowing dramatically, profitability is dropping, competition from Asia-based companies is heating up and employee turnover, at 25 per cent of the workforce, is the highest it has ever been. The company, based in Helena, Montana, is underperforming after years of growth: it had seen tenfold revenue increases over the past decade. Aware that he does not have an engineering degree or any experience running manufacturing plants, the director needs to assess the situation carefully. He is plotting out what he has to do in the next few months to turn the company's fortunes around.
Swot Analysis of "Montana Plastic Inc.: The Shelby Division in 2014" written by Christopher Williams, Ken Mark includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Montana Shelby facing as an external strategic factors. Some of the topics covered in Montana Plastic Inc.: The Shelby Division in 2014 case study are - Strategic Management Strategies, Crisis management, Human resource management, Leadership, Manufacturing, Organizational culture, Strategy and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Montana Plastic Inc.: The Shelby Division in 2014 casestudy better are - – competitive advantages are harder to sustain because of technology dispersion, increasing household debt because of falling income levels, increasing commodity prices, supply chains are disrupted by pandemic , technology disruption, wage bills are increasing, increasing transportation and logistics costs,
increasing inequality as vast percentage of new income is going to the top 1%, increasing energy prices, etc
Introduction to SWOT Analysis of Montana Plastic Inc.: The Shelby Division in 2014
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Montana Plastic Inc.: The Shelby Division in 2014 case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Montana Shelby, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Montana Shelby 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 Montana Plastic Inc.: The Shelby Division in 2014 can be done for the following purposes –
1. Strategic planning using facts provided in Montana Plastic Inc.: The Shelby Division in 2014 case study
2. Improving business portfolio management of Montana Shelby
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 Montana Shelby
Strengths Montana Plastic Inc.: The Shelby Division in 2014 | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Montana Shelby in Montana Plastic Inc.: The Shelby Division in 2014 Harvard Business Review case study are -
High brand equity
– Montana Shelby has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Montana Shelby to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Montana Shelby is present in almost all the verticals within the industry. This has provided firm in Montana Plastic Inc.: The Shelby Division in 2014 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.
Strong track record of project management
– Montana Shelby is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Cross disciplinary teams
– Horizontal connected teams at the Montana Shelby 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.
Ability to recruit top talent
– Montana Shelby is one of the leading recruiters in the industry. Managers in the Montana Plastic Inc.: The Shelby Division in 2014 are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Operational resilience
– The operational resilience strategy in the Montana Plastic Inc.: The Shelby Division in 2014 Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Organizational Resilience of Montana Shelby
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Montana Shelby does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Innovation driven organization
– Montana Shelby is one of the most innovative firm in sector. Manager in Montana Plastic Inc.: The Shelby Division in 2014 Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Low bargaining power of suppliers
– Suppliers of Montana Shelby in the sector have low bargaining power. Montana Plastic Inc.: The Shelby Division in 2014 has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Montana Shelby to manage not only supply disruptions but also source products at highly competitive prices.
Learning organization
- Montana Shelby 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 Montana Shelby is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Montana Plastic Inc.: The Shelby Division in 2014 Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Highly skilled collaborators
– Montana Shelby 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 Montana Plastic Inc.: The Shelby Division in 2014 HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to lead change in Leadership & Managing People field
– Montana Shelby is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Montana Shelby in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Weaknesses Montana Plastic Inc.: The Shelby Division in 2014 | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Montana Plastic Inc.: The Shelby Division in 2014 are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Montana Shelby is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Montana Plastic Inc.: The Shelby Division in 2014 can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Slow to strategic competitive environment developments
– As Montana Plastic Inc.: The Shelby Division in 2014 HBR case study mentions - Montana Shelby 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Montana Plastic Inc.: The Shelby Division in 2014, in the dynamic environment Montana Shelby has struggled to respond to the nimble upstart competition. Montana Shelby has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow decision making process
– As mentioned earlier in the report, Montana Shelby 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. Montana Shelby 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.
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 Montana Shelby supply chain. Even after few cautionary changes mentioned in the HBR case study - Montana Plastic Inc.: The Shelby Division in 2014, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Montana Shelby vulnerable to further global disruptions in South East Asia.
Low market penetration in new markets
– Outside its home market of Montana Shelby, firm in the HBR case study Montana Plastic Inc.: The Shelby Division in 2014 needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High bargaining power of channel partners
– Because of the regulatory requirements, Christopher Williams, Ken Mark suggests that, Montana Shelby 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Montana Plastic Inc.: The Shelby Division in 2014, is just above the industry average. Montana Shelby 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.
Need for greater diversity
– Montana Shelby 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.
Interest costs
– Compare to the competition, Montana Shelby 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
Montana Shelby 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 Montana Plastic Inc.: The Shelby Division in 2014 | 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 Montana Plastic Inc.: The Shelby Division in 2014 are -
Developing new processes and practices
– Montana Shelby 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.
Building a culture of innovation
– managers at Montana Shelby 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Montana Shelby 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Montana Shelby is facing challenges because of the dominance of functional experts in the organization. Montana Plastic Inc.: The Shelby Division in 2014 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.
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. Montana Shelby 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. Montana Shelby 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Montana Shelby 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.
Creating value in data economy
– The success of analytics program of Montana Shelby has opened avenues for new revenue streams for the organization in the industry. This can help Montana Shelby to build a more holistic ecosystem as suggested in the Montana Plastic Inc.: The Shelby Division in 2014 case study. Montana Shelby 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, Montana Shelby can use these opportunities to build new business models that can help the communities that Montana Shelby operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Montana Shelby 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 Montana Shelby to hire the very best people irrespective of their geographical location.
Loyalty marketing
– Montana Shelby 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.
Learning at scale
– Online learning technologies has now opened space for Montana Shelby 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.
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. Montana Shelby can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Buying journey improvements
– Montana Shelby can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Montana Plastic Inc.: The Shelby Division in 2014 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.
Threats Montana Plastic Inc.: The Shelby Division in 2014 External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Montana Plastic Inc.: The Shelby Division in 2014 are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Montana Shelby 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 Montana Plastic Inc.: The Shelby Division in 2014 .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Montana Shelby with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Montana Shelby in the Leadership & Managing People sector and impact the bottomline of the organization.
Increasing wage structure of Montana Shelby
– 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 Montana Shelby.
Shortening product life cycle
– it is one of the major threat that Montana Shelby is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Technology acceleration in Forth Industrial Revolution
– Montana Shelby has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Montana Shelby 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.
High dependence on third party suppliers
– Montana Shelby 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
– Montana Shelby 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. Montana Shelby can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
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 Montana Shelby business can come under increasing regulations regarding data privacy, data security, etc.
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.
Regulatory challenges
– Montana Shelby 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.
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. Montana Shelby 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.
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.
Weighted SWOT Analysis of Montana Plastic Inc.: The Shelby Division in 2014 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 Montana Plastic Inc.: The Shelby Division in 2014 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 Montana Plastic Inc.: The Shelby Division in 2014 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 Montana Plastic Inc.: The Shelby Division in 2014 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 Montana Plastic Inc.: The Shelby Division in 2014 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 Montana Shelby needs to make to build a sustainable competitive advantage.