What to Expect From a Corporate Lean Program SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of What to Expect From a Corporate Lean Program
Corporate "lean" programs, often modeled after the Toyota Production System, can be powerful instruments for improving the performance of manufacturing plants. They help to emphasize parts of the production process that add the most value and eliminate those that don't. However, misplaced expectations can make implementation difficult and reduce the benefits. The authors argue that if managers better understood the expected rates of improvement, then implementations would go more smoothly. The authors studied the implementation of the Volvo Group's production system. Volvo Group, a leading maker of trucks and other heavy vehicles. The company introduced the Volvo Production System in 2007, and since then has been implementing it in its factories around the world. The authors visited 44 of Volvo's 67 plants and interviewed 200 managers. They found that there were four distinct stages of change in the rate of performance improvement and that there was a strong relationship between a plant's maturity in a production system implementation and its performance; progress roughly followed the shape of an S-curve: a plant's rate of improvement changes in the shape of a bell curve as the plant becomes more mature in implementing the production system. Performance improves slowly at first, and then at an increasing rate before the improvement rate gradually decreases. To measure the performance of the plants, the authors focused on nonfinancial metrics related to the quality, cost, delivery and safety of the plant's output. They then used statistical methods to find patterns. Volvo's assessment process provides a structure to help local managers compare their plants. It also provides a mechanism for transferring expertise and best practices. The assessments have a strong symbolic impact: They communicate the company's commitment to the production system. Implementing a production system is a long journey, but the authors conclude that it's a worthwhile endeavor. This is an MIT Sloan Management Review article.
Swot Analysis of "What to Expect From a Corporate Lean Program" written by Torbjorn Netland, Kasra Ferdows includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Production Volvo facing as an external strategic factors. Some of the topics covered in What to Expect From a Corporate Lean Program case study are - Strategic Management Strategies, and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the What to Expect From a Corporate Lean Program casestudy better are - – geopolitical disruptions, increasing energy prices, increasing government debt because of Covid-19 spendings, central banks are concerned over increasing inflation, banking and financial system is disrupted by Bitcoin and other crypto currencies, technology disruption, there is increasing trade war between United States & China,
challanges to central banks by blockchain based private currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
Introduction to SWOT Analysis of What to Expect From a Corporate Lean Program
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in What to Expect From a Corporate Lean Program case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Production Volvo, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Production Volvo 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 What to Expect From a Corporate Lean Program can be done for the following purposes –
1. Strategic planning using facts provided in What to Expect From a Corporate Lean Program case study
2. Improving business portfolio management of Production Volvo
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 Production Volvo
Strengths What to Expect From a Corporate Lean Program | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Production Volvo in What to Expect From a Corporate Lean Program Harvard Business Review case study are -
Organizational Resilience of Production Volvo
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Production Volvo does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to lead change in Leadership & Managing People field
– Production Volvo 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 Production Volvo 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 Production Volvo in the sector have low bargaining power. What to Expect From a Corporate Lean Program has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Production Volvo to manage not only supply disruptions but also source products at highly competitive prices.
Learning organization
- Production Volvo 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 Production Volvo is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in What to Expect From a Corporate Lean Program Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Highly skilled collaborators
– Production Volvo 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 What to Expect From a Corporate Lean Program HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Cross disciplinary teams
– Horizontal connected teams at the Production Volvo 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.
Diverse revenue streams
– Production Volvo is present in almost all the verticals within the industry. This has provided firm in What to Expect From a Corporate Lean Program 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
– Production Volvo 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 brand equity
– Production Volvo has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Production Volvo to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Superior customer experience
– The customer experience strategy of Production Volvo in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Innovation driven organization
– Production Volvo is one of the most innovative firm in sector. Manager in What to Expect From a Corporate Lean Program Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Successful track record of launching new products
– Production Volvo has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Production Volvo 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.
Weaknesses What to Expect From a Corporate Lean Program | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of What to Expect From a Corporate Lean Program are -
Skills based hiring
– The stress on hiring functional specialists at Production Volvo 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.
Increasing silos among functional specialists
– The organizational structure of Production Volvo is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Production Volvo needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Production Volvo to focus more on services rather than just following the product oriented approach.
Aligning sales with marketing
– It come across in the case study What to Expect From a Corporate Lean Program 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 What to Expect From a Corporate Lean Program can leverage the sales team experience to cultivate customer relationships as Production Volvo is planning to shift buying processes online.
Capital Spending Reduction
– Even during the low interest decade, Production Volvo has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
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 Production Volvo supply chain. Even after few cautionary changes mentioned in the HBR case study - What to Expect From a Corporate Lean Program, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Production Volvo vulnerable to further global disruptions in South East Asia.
High operating costs
– Compare to the competitors, firm in the HBR case study What to Expect From a Corporate Lean Program 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 Production Volvo 's lucrative customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Production Volvo 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 What to Expect From a Corporate Lean Program, it seems that the employees of Production Volvo 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.
Slow to strategic competitive environment developments
– As What to Expect From a Corporate Lean Program HBR case study mentions - Production Volvo 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study What to Expect From a Corporate Lean Program, is just above the industry average. Production Volvo 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 dependence on star products
– The top 2 products and services of the firm as mentioned in the What to Expect From a Corporate Lean Program 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 Production Volvo has relatively successful track record of launching new products.
Opportunities What to Expect From a Corporate Lean Program | 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 What to Expect From a Corporate Lean Program are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Production Volvo 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.
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. Production Volvo can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Better consumer reach
– The expansion of the 5G network will help Production Volvo to increase its market reach. Production Volvo 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.
Building a culture of innovation
– managers at Production Volvo 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.
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 Production Volvo 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
– Production Volvo 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 What to Expect From a Corporate Lean Program - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Production Volvo to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Production Volvo can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Buying journey improvements
– Production Volvo can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. What to Expect From a Corporate Lean Program 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. Production Volvo can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Manufacturing automation
– Production Volvo 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 Production Volvo has opened avenues for new revenue streams for the organization in the industry. This can help Production Volvo to build a more holistic ecosystem as suggested in the What to Expect From a Corporate Lean Program case study. Production Volvo can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Production Volvo is facing challenges because of the dominance of functional experts in the organization. What to Expect From a Corporate Lean Program 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.
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 Production Volvo in the consumer business. Now Production Volvo can target international markets with far fewer capital restrictions requirements than the existing system.
Threats What to Expect From a Corporate Lean Program External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study What to Expect From a Corporate Lean Program are -
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Production Volvo with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
High dependence on third party suppliers
– Production Volvo 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.
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. Production Volvo can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Production Volvo 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.
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 Production Volvo business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Production Volvo 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. Production Volvo 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study What to Expect From a Corporate Lean Program, Production Volvo 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 .
Consumer confidence and its impact on Production Volvo 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 Production Volvo in the Leadership & Managing People sector and impact the bottomline of the organization.
Increasing wage structure of Production Volvo
– 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 Production Volvo.
Weighted SWOT Analysis of What to Expect From a Corporate Lean Program 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 What to Expect From a Corporate Lean Program 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 What to Expect From a Corporate Lean Program 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 What to Expect From a Corporate Lean Program 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 What to Expect From a Corporate Lean Program 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 Production Volvo needs to make to build a sustainable competitive advantage.
