Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged)
This version condenses the two parts of "K&S Industries Inc. in China: Transferring Knowledge (A) and (B)" into a single-use case. Suitable for the MBA, EMBA, GEMBA, and executive education programs, the case presents a manufacturer of semiconductor assembly equipment looking to achieve growth in its wire bonding tools segment-in particular, capillaries and dicing saw blades-through geographic expansion. At the time, it manufactured capillaries in Yokneam, Israel, and blades in Santa Clara, California. While much of the work on outsourcing to China focuses on the low cost and its tradeoffs, this case examines in depth the interaction between human capital and a firm's cost and capabilities. The expansion committee team is charged with designing and opening a new facility in Suzhou, China. Expanding operations to China meant cost savings, and it was where K&S's market had expanded. But it wasn't clear whether it made sense to move the capillary process, the dicing blade manufacturing, or both. And if K&S did move to China, it would keep the Israeli-based factory open but close the American-based. If both were moved, what order would make sense given that one existing factory would be closed down and the other kept open? And once those decisions were made, what exactly would the knowledge transfer look like?
Authors :: Gal Raz, Martin N. Davidson, Gerry Yemen
Swot Analysis of "Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged)" written by Gal Raz, Martin N. Davidson, Gerry Yemen includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Capillaries Dicing facing as an external strategic factors. Some of the topics covered in Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) case study are - Strategic Management Strategies, Growth strategy, Knowledge management, Technology and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) casestudy better are - – central banks are concerned over increasing inflation, competitive advantages are harder to sustain because of technology dispersion, geopolitical disruptions, talent flight as more people leaving formal jobs, increasing household debt because of falling income levels, increasing inequality as vast percentage of new income is going to the top 1%, challanges to central banks by blockchain based private currencies,
there is backlash against globalization, wage bills are increasing, etc
Introduction to SWOT Analysis of Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Capillaries Dicing, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Capillaries Dicing 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 Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) can be done for the following purposes –
1. Strategic planning using facts provided in Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) case study
2. Improving business portfolio management of Capillaries Dicing
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 Capillaries Dicing
Strengths Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Capillaries Dicing in Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) Harvard Business Review case study are -
Learning organization
- Capillaries Dicing 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 Capillaries Dicing is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
High switching costs
– The high switching costs that Capillaries Dicing 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.
Cross disciplinary teams
– Horizontal connected teams at the Capillaries Dicing 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
– Capillaries Dicing is present in almost all the verticals within the industry. This has provided firm in Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) 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.
Ability to recruit top talent
– Capillaries Dicing is one of the leading recruiters in the industry. Managers in the Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Highly skilled collaborators
– Capillaries Dicing 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 Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) 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
– Capillaries Dicing has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Capillaries Dicing 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.
Strong track record of project management
– Capillaries Dicing is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Analytics focus
– Capillaries Dicing 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 Gal Raz, Martin N. Davidson, Gerry Yemen 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.
Training and development
– Capillaries Dicing has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) 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.
Superior customer experience
– The customer experience strategy of Capillaries Dicing in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Innovation driven organization
– Capillaries Dicing is one of the most innovative firm in sector. Manager in Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Weaknesses Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) are -
Lack of clear differentiation of Capillaries Dicing products
– To increase the profitability and margins on the products, Capillaries Dicing needs to provide more differentiated products than what it is currently offering in the marketplace.
Skills based hiring
– The stress on hiring functional specialists at Capillaries Dicing 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
– Capillaries Dicing 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.
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 Capillaries Dicing supply chain. Even after few cautionary changes mentioned in the HBR case study - Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Capillaries Dicing vulnerable to further global disruptions in South East Asia.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Capillaries Dicing is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Increasing silos among functional specialists
– The organizational structure of Capillaries Dicing is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Capillaries Dicing needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Capillaries Dicing to focus more on services rather than just following the product oriented approach.
No frontier risks strategy
– After analyzing the HBR case study Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged), 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.
Low market penetration in new markets
– Outside its home market of Capillaries Dicing, firm in the HBR case study Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Products dominated business model
– Even though Capillaries Dicing 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 - Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) should strive to include more intangible value offerings along with its core products and services.
Slow to strategic competitive environment developments
– As Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) HBR case study mentions - Capillaries Dicing 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.
Capital Spending Reduction
– Even during the low interest decade, Capillaries Dicing 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.
Opportunities Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) | 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 Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) are -
Leveraging digital technologies
– Capillaries Dicing 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.
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 Capillaries Dicing 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.
Manufacturing automation
– Capillaries Dicing 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.
Learning at scale
– Online learning technologies has now opened space for Capillaries Dicing 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.
Using analytics as competitive advantage
– Capillaries Dicing 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 Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Capillaries Dicing to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Buying journey improvements
– Capillaries Dicing can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) 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.
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. Capillaries Dicing 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. Capillaries Dicing 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.
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. Capillaries Dicing can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Building a culture of innovation
– managers at Capillaries Dicing 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Capillaries Dicing 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 Capillaries Dicing to hire the very best people irrespective of their geographical location.
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 Capillaries Dicing in the consumer business. Now Capillaries Dicing can target international markets with far fewer capital restrictions requirements than the existing system.
Loyalty marketing
– Capillaries Dicing 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Capillaries Dicing can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Threats Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) are -
Consumer confidence and its impact on Capillaries Dicing 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.
Regulatory challenges
– Capillaries Dicing 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.
High dependence on third party suppliers
– Capillaries Dicing 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged), Capillaries Dicing 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 .
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.
Stagnating economy with rate increase
– Capillaries Dicing 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.
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 Capillaries Dicing business can come under increasing regulations regarding data privacy, data security, etc.
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 Capillaries Dicing in the Leadership & Managing People sector and impact the bottomline of the organization.
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. Capillaries Dicing needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Technology acceleration in Forth Industrial Revolution
– Capillaries Dicing has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Capillaries Dicing 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.
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. Capillaries Dicing can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing wage structure of Capillaries Dicing
– 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 Capillaries Dicing.
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. Capillaries Dicing 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 Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) 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 Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) 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 Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) 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 Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) 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 Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A) and (B) (Abridged) 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 Capillaries Dicing needs to make to build a sustainable competitive advantage.
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