Manufacturing Outsourcing, Onshoring, and Global Equilibrium SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Manufacturing Outsourcing, Onshoring, and Global Equilibrium
Manufacturing is now a national strategy for many countries to combat slow economic growth, and positively viewed with the current trend of onshoring foreign manufacturing operations. We develop a cross-country regression model that predicts manufacturing employment as a function of population growth, foreign direct investment, and purchasing power parity. Results through the year 2100 suggest that manufacturing is trending toward a global equilibrium with higher levels of manufacturing outputs but much lower levels of manufacturing employment. The reason is that countries tend to evolve from having little manufacturing to commodity manufacturing at large scale and low wages. As infrastructure and human capital develop, there is the tendency to pursue advanced manufacturing in support of higher valued goods. The manufacture of commodity products is then outsourced to those countries with lower costs justified by their less-developed infrastructure and human capital, and so the virtuous cycle continues. While this model suggests that current efforts in revitalization of domestic manufacturing would lead to an increase in wealth in the United States, the bad news is that these gains are unlikely to be sustainable in the long term. However, the good news is that manufacturing acts as a rising tide that raises all nations and our global quality of life.
Swot Analysis of "Manufacturing Outsourcing, Onshoring, and Global Equilibrium" written by David Owen Kazmer includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Manufacturing Onshoring facing as an external strategic factors. Some of the topics covered in Manufacturing Outsourcing, Onshoring, and Global Equilibrium case study are - Strategic Management Strategies, Operations management and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Manufacturing Outsourcing, Onshoring, and Global Equilibrium casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing transportation and logistics costs, there is backlash against globalization, there is increasing trade war between United States & China, talent flight as more people leaving formal jobs, competitive advantages are harder to sustain because of technology dispersion, digital marketing is dominated by two big players Facebook and Google,
challanges to central banks by blockchain based private currencies, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of Manufacturing Outsourcing, Onshoring, and Global Equilibrium
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Manufacturing Outsourcing, Onshoring, and Global Equilibrium case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Manufacturing Onshoring, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Manufacturing Onshoring 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 Manufacturing Outsourcing, Onshoring, and Global Equilibrium can be done for the following purposes –
1. Strategic planning using facts provided in Manufacturing Outsourcing, Onshoring, and Global Equilibrium case study
2. Improving business portfolio management of Manufacturing Onshoring
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 Manufacturing Onshoring
Strengths Manufacturing Outsourcing, Onshoring, and Global Equilibrium | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Manufacturing Onshoring in Manufacturing Outsourcing, Onshoring, and Global Equilibrium Harvard Business Review case study are -
Analytics focus
– Manufacturing Onshoring 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 David Owen Kazmer 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.
Strong track record of project management
– Manufacturing Onshoring is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Learning organization
- Manufacturing Onshoring 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 Manufacturing Onshoring is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Manufacturing Outsourcing, Onshoring, and Global Equilibrium Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Low bargaining power of suppliers
– Suppliers of Manufacturing Onshoring in the sector have low bargaining power. Manufacturing Outsourcing, Onshoring, and Global Equilibrium has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Manufacturing Onshoring to manage not only supply disruptions but also source products at highly competitive prices.
Ability to recruit top talent
– Manufacturing Onshoring is one of the leading recruiters in the industry. Managers in the Manufacturing Outsourcing, Onshoring, and Global Equilibrium are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Organizational Resilience of Manufacturing Onshoring
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Manufacturing Onshoring does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High switching costs
– The high switching costs that Manufacturing Onshoring 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.
Highly skilled collaborators
– Manufacturing Onshoring 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 Manufacturing Outsourcing, Onshoring, and Global Equilibrium HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– Manufacturing Onshoring has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Manufacturing Onshoring has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Innovation driven organization
– Manufacturing Onshoring is one of the most innovative firm in sector. Manager in Manufacturing Outsourcing, Onshoring, and Global Equilibrium Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Manufacturing Onshoring digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Manufacturing Onshoring 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.
Effective Research and Development (R&D)
– Manufacturing Onshoring 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 Manufacturing Outsourcing, Onshoring, and Global Equilibrium - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses Manufacturing Outsourcing, Onshoring, and Global Equilibrium | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Manufacturing Outsourcing, Onshoring, and Global Equilibrium are -
Skills based hiring
– The stress on hiring functional specialists at Manufacturing Onshoring 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.
Need for greater diversity
– Manufacturing Onshoring 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Manufacturing Onshoring 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Manufacturing Outsourcing, Onshoring, and Global Equilibrium, it seems that the employees of Manufacturing Onshoring 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.
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 Manufacturing Onshoring supply chain. Even after few cautionary changes mentioned in the HBR case study - Manufacturing Outsourcing, Onshoring, and Global Equilibrium, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Manufacturing Onshoring vulnerable to further global disruptions in South East Asia.
No frontier risks strategy
– After analyzing the HBR case study Manufacturing Outsourcing, Onshoring, and Global Equilibrium, 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.
High cash cycle compare to competitors
Manufacturing Onshoring 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, Manufacturing Onshoring 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 dependence on star products
– The top 2 products and services of the firm as mentioned in the Manufacturing Outsourcing, Onshoring, and Global Equilibrium 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 Manufacturing Onshoring has relatively successful track record of launching new products.
Slow decision making process
– As mentioned earlier in the report, Manufacturing Onshoring 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. Manufacturing Onshoring 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.
Low market penetration in new markets
– Outside its home market of Manufacturing Onshoring, firm in the HBR case study Manufacturing Outsourcing, Onshoring, and Global Equilibrium needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Opportunities Manufacturing Outsourcing, Onshoring, and Global Equilibrium | 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 Manufacturing Outsourcing, Onshoring, and Global Equilibrium are -
Building a culture of innovation
– managers at Manufacturing Onshoring 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.
Developing new processes and practices
– Manufacturing Onshoring 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.
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 Manufacturing Onshoring 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.
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. Manufacturing Onshoring can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Manufacturing Onshoring 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 Manufacturing Onshoring to hire the very best people irrespective of their geographical location.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Manufacturing Onshoring can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Manufacturing Onshoring 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. Manufacturing Onshoring 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Manufacturing Onshoring can use these opportunities to build new business models that can help the communities that Manufacturing Onshoring operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Manufacturing automation
– Manufacturing Onshoring 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.
Creating value in data economy
– The success of analytics program of Manufacturing Onshoring has opened avenues for new revenue streams for the organization in the industry. This can help Manufacturing Onshoring to build a more holistic ecosystem as suggested in the Manufacturing Outsourcing, Onshoring, and Global Equilibrium case study. Manufacturing Onshoring can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Loyalty marketing
– Manufacturing Onshoring 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.
Buying journey improvements
– Manufacturing Onshoring can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Manufacturing Outsourcing, Onshoring, and Global Equilibrium 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. Manufacturing Onshoring can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats Manufacturing Outsourcing, Onshoring, and Global Equilibrium External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Manufacturing Outsourcing, Onshoring, and Global Equilibrium 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. Manufacturing Onshoring can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
High dependence on third party suppliers
– Manufacturing Onshoring 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Manufacturing Onshoring 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.
Regulatory challenges
– Manufacturing Onshoring 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.
Shortening product life cycle
– it is one of the major threat that Manufacturing Onshoring is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Manufacturing Outsourcing, Onshoring, and Global Equilibrium, Manufacturing Onshoring may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Leadership & Managing People .
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Manufacturing Onshoring 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 Manufacturing Outsourcing, Onshoring, and Global Equilibrium .
Stagnating economy with rate increase
– Manufacturing Onshoring 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Manufacturing Onshoring with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing wage structure of Manufacturing Onshoring
– 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 Manufacturing Onshoring.
Environmental challenges
– Manufacturing Onshoring 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. Manufacturing Onshoring can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Technology acceleration in Forth Industrial Revolution
– Manufacturing Onshoring has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Manufacturing Onshoring 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.
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 Manufacturing Onshoring business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of Manufacturing Outsourcing, Onshoring, and Global Equilibrium 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 Manufacturing Outsourcing, Onshoring, and Global Equilibrium 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 Manufacturing Outsourcing, Onshoring, and Global Equilibrium 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 Manufacturing Outsourcing, Onshoring, and Global Equilibrium 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 Manufacturing Outsourcing, Onshoring, and Global Equilibrium 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 Manufacturing Onshoring needs to make to build a sustainable competitive advantage.