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 - – increasing household debt because of falling income levels, increasing energy prices, supply chains are disrupted by pandemic , competitive advantages are harder to sustain because of technology dispersion, digital marketing is dominated by two big players Facebook and Google, cloud computing is disrupting traditional business models, challanges to central banks by blockchain based private currencies,
increasing transportation and logistics costs, central banks are concerned over increasing inflation, 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 -
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.
Analytics focus
– Production Volvo 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 Torbjorn Netland, Kasra Ferdows 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.
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.
Sustainable margins compare to other players in Leadership & Managing People industry
– What to Expect From a Corporate Lean Program firm has clearly differentiated products in the market place. This has enabled Production Volvo to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Production Volvo to invest into research and development (R&D) and innovation.
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.
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.
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.
Effective Research and Development (R&D)
– Production Volvo 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 What to Expect From a Corporate Lean Program - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
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.
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.
Training and development
– Production Volvo has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in What to Expect From a Corporate Lean Program Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Production Volvo digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Production Volvo 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.
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 -
Need for greater diversity
– Production Volvo 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.
Products dominated business model
– Even though Production Volvo has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - What to Expect From a Corporate Lean Program should strive to include more intangible value offerings along with its core products and services.
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.
High bargaining power of channel partners
– Because of the regulatory requirements, Torbjorn Netland, Kasra Ferdows suggests that, Production Volvo 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.
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.
Interest costs
– Compare to the competition, Production Volvo 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.
No frontier risks strategy
– After analyzing the HBR case study What to Expect From a Corporate Lean Program, 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.
Lack of clear differentiation of Production Volvo products
– To increase the profitability and margins on the products, Production Volvo needs to provide more differentiated products than what it is currently offering in the marketplace.
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 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.
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.
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 -
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. Production Volvo 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. Production Volvo 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.
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.
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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Production Volvo can use these opportunities to build new business models that can help the communities that Production Volvo operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Developing new processes and practices
– Production Volvo 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.
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.
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.
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.
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.
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.
Leveraging digital technologies
– Production Volvo can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Production Volvo can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, What to Expect From a Corporate Lean Program, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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 -
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Production Volvo.
Environmental challenges
– Production Volvo 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. Production Volvo can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Production Volvo 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 What to Expect From a Corporate Lean Program .
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.
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.
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.
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. Production Volvo needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Regulatory challenges
– Production Volvo 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.
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.
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.
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 acceleration in Forth Industrial Revolution
– Production Volvo has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Production Volvo 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.
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.