Case Study Description of The PCNet Project (B): Dynamically Managing Residual Risk
The case describes a large and complex IT integration project, after the acquisition of one metals mining company by another. As part of the integration, 40,000 PCs, applications, and the network had to be consolidated into one system. The project lasted two years and involved 1,000 people across the organization.
Swot Analysis of "The PCNet Project (B): Dynamically Managing Residual Risk" written by Christoph H. Loch includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Pcnet Project facing as an external strategic factors. Some of the topics covered in The PCNet Project (B): Dynamically Managing Residual Risk case study are - Strategic Management Strategies, Project management, Risk management and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the The PCNet Project (B): Dynamically Managing Residual Risk casestudy better are - – increasing transportation and logistics costs, supply chains are disrupted by pandemic , there is increasing trade war between United States & China, wage bills are increasing, increasing inequality as vast percentage of new income is going to the top 1%, banking and financial system is disrupted by Bitcoin and other crypto currencies, customer relationship management is fast transforming because of increasing concerns over data privacy,
increasing household debt because of falling income levels, technology disruption, etc
Introduction to SWOT Analysis of The PCNet Project (B): Dynamically Managing Residual Risk
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The PCNet Project (B): Dynamically Managing Residual Risk case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Pcnet Project, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Pcnet Project 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 PCNet Project (B): Dynamically Managing Residual Risk can be done for the following purposes –
1. Strategic planning using facts provided in The PCNet Project (B): Dynamically Managing Residual Risk case study
2. Improving business portfolio management of Pcnet Project
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 Pcnet Project
Strengths The PCNet Project (B): Dynamically Managing Residual Risk | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Pcnet Project in The PCNet Project (B): Dynamically Managing Residual Risk Harvard Business Review case study are -
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Pcnet Project digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Pcnet Project 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.
High switching costs
– The high switching costs that Pcnet Project 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 PCNet Project (B): Dynamically Managing Residual Risk 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 Pcnet Project
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Pcnet Project does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Innovation driven organization
– Pcnet Project is one of the most innovative firm in sector. Manager in The PCNet Project (B): Dynamically Managing Residual Risk Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Highly skilled collaborators
– Pcnet Project 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 PCNet Project (B): Dynamically Managing Residual Risk HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Effective Research and Development (R&D)
– Pcnet Project has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study The PCNet Project (B): Dynamically Managing Residual Risk - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Sustainable margins compare to other players in Leadership & Managing People industry
– The PCNet Project (B): Dynamically Managing Residual Risk firm has clearly differentiated products in the market place. This has enabled Pcnet Project to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Pcnet Project to invest into research and development (R&D) and innovation.
Ability to lead change in Leadership & Managing People field
– Pcnet Project 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 Pcnet Project in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Low bargaining power of suppliers
– Suppliers of Pcnet Project in the sector have low bargaining power. The PCNet Project (B): Dynamically Managing Residual Risk has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Pcnet Project to manage not only supply disruptions but also source products at highly competitive prices.
High brand equity
– Pcnet Project has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Pcnet Project to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Pcnet Project is present in almost all the verticals within the industry. This has provided firm in The PCNet Project (B): Dynamically Managing Residual Risk case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Weaknesses The PCNet Project (B): Dynamically Managing Residual Risk | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The PCNet Project (B): Dynamically Managing Residual Risk are -
Slow to strategic competitive environment developments
– As The PCNet Project (B): Dynamically Managing Residual Risk HBR case study mentions - Pcnet Project 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.
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 Pcnet Project supply chain. Even after few cautionary changes mentioned in the HBR case study - The PCNet Project (B): Dynamically Managing Residual Risk, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Pcnet Project vulnerable to further global disruptions in South East Asia.
High operating costs
– Compare to the competitors, firm in the HBR case study The PCNet Project (B): Dynamically Managing Residual Risk has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Pcnet Project 's lucrative customers.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study The PCNet Project (B): Dynamically Managing Residual Risk, is just above the industry average. Pcnet Project needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
High bargaining power of channel partners
– Because of the regulatory requirements, Christoph H. Loch suggests that, Pcnet Project 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.
Skills based hiring
– The stress on hiring functional specialists at Pcnet Project 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.
Lack of clear differentiation of Pcnet Project products
– To increase the profitability and margins on the products, Pcnet Project needs to provide more differentiated products than what it is currently offering in the marketplace.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study The PCNet Project (B): Dynamically Managing Residual Risk, in the dynamic environment Pcnet Project has struggled to respond to the nimble upstart competition. Pcnet Project has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Pcnet Project is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study The PCNet Project (B): Dynamically Managing Residual Risk 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 star products
– The top 2 products and services of the firm as mentioned in the The PCNet Project (B): Dynamically Managing Residual Risk 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 Pcnet Project has relatively successful track record of launching new products.
Low market penetration in new markets
– Outside its home market of Pcnet Project, firm in the HBR case study The PCNet Project (B): Dynamically Managing Residual Risk needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Opportunities The PCNet Project (B): Dynamically Managing Residual Risk | 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 PCNet Project (B): Dynamically Managing Residual Risk are -
Manufacturing automation
– Pcnet Project can use the latest technology developments to improve its manufacturing and designing process in Leadership & Managing People segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Better consumer reach
– The expansion of the 5G network will help Pcnet Project to increase its market reach. Pcnet Project 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.
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 Pcnet Project in the consumer business. Now Pcnet Project can target international markets with far fewer capital restrictions requirements than the existing system.
Creating value in data economy
– The success of analytics program of Pcnet Project has opened avenues for new revenue streams for the organization in the industry. This can help Pcnet Project to build a more holistic ecosystem as suggested in the The PCNet Project (B): Dynamically Managing Residual Risk case study. Pcnet Project can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Pcnet Project can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. The PCNet Project (B): Dynamically Managing Residual Risk 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.
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. Pcnet Project can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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 Pcnet Project 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.
Using analytics as competitive advantage
– Pcnet Project 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 PCNet Project (B): Dynamically Managing Residual Risk - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Pcnet Project to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Pcnet Project is facing challenges because of the dominance of functional experts in the organization. The PCNet Project (B): Dynamically Managing Residual Risk 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Pcnet Project 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 Pcnet Project to hire the very best people irrespective of their geographical location.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Pcnet Project can use these opportunities to build new business models that can help the communities that Pcnet Project operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Building a culture of innovation
– managers at Pcnet Project 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.
Learning at scale
– Online learning technologies has now opened space for Pcnet Project 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.
Threats The PCNet Project (B): Dynamically Managing Residual Risk External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The PCNet Project (B): Dynamically Managing Residual Risk are -
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. Pcnet Project can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Pcnet Project needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Environmental challenges
– Pcnet Project 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. Pcnet Project can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Regulatory challenges
– Pcnet Project 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Pcnet Project with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
Consumer confidence and its impact on Pcnet Project 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.
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 Pcnet Project in the Leadership & Managing People sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– Pcnet Project has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Pcnet Project 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.
Increasing wage structure of Pcnet Project
– 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 Pcnet Project.
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 Pcnet Project business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Pcnet Project can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
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. Pcnet Project 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.
Weighted SWOT Analysis of The PCNet Project (B): Dynamically Managing Residual Risk 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 PCNet Project (B): Dynamically Managing Residual Risk 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 PCNet Project (B): Dynamically Managing Residual Risk 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 PCNet Project (B): Dynamically Managing Residual Risk 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 PCNet Project (B): Dynamically Managing Residual Risk 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 Pcnet Project needs to make to build a sustainable competitive advantage.