Volvo Construction Equipment: Managing a Plant Closure (A) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Volvo Construction Equipment: Managing a Plant Closure (A)
The vice-president and general manager of the Canadian operations of a multinational vehicle manufacturer learns that the plant he supervises will be shut down in 15 months. In the months leading up to the shutdown announcement and subsequent winding down, he needs to manage the communications and followup with several stakeholder groups. The vice-president and general manager needs to balance several issues, including the need to keep production high and waste down, while preparing to lay off the workers who will be contributing to the plant's short-term success. To be used with supplemental cases (9B13M019, 9B13M020).
Swot Analysis of "Volvo Construction Equipment: Managing a Plant Closure (A)" written by Mary Weil, Ken Mark includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that 9b13m019 9b13m020 facing as an external strategic factors. Some of the topics covered in Volvo Construction Equipment: Managing a Plant Closure (A) case study are - Strategic Management Strategies, and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Volvo Construction Equipment: Managing a Plant Closure (A) casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, cloud computing is disrupting traditional business models, talent flight as more people leaving formal jobs, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing transportation and logistics costs, increasing energy prices, there is backlash against globalization,
supply chains are disrupted by pandemic , increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of Volvo Construction Equipment: Managing a Plant Closure (A)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Volvo Construction Equipment: Managing a Plant Closure (A) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the 9b13m019 9b13m020, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which 9b13m019 9b13m020 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 Volvo Construction Equipment: Managing a Plant Closure (A) can be done for the following purposes –
1. Strategic planning using facts provided in Volvo Construction Equipment: Managing a Plant Closure (A) case study
2. Improving business portfolio management of 9b13m019 9b13m020
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 9b13m019 9b13m020
Strengths Volvo Construction Equipment: Managing a Plant Closure (A) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of 9b13m019 9b13m020 in Volvo Construction Equipment: Managing a Plant Closure (A) Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of 9b13m019 9b13m020 in the sector have low bargaining power. Volvo Construction Equipment: Managing a Plant Closure (A) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps 9b13m019 9b13m020 to manage not only supply disruptions but also source products at highly competitive prices.
Organizational Resilience of 9b13m019 9b13m020
– The covid-19 pandemic has put organizational resilience at the centre of everthing that 9b13m019 9b13m020 does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– 9b13m019 9b13m020 is one of the leading recruiters in the industry. Managers in the Volvo Construction Equipment: Managing a Plant Closure (A) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Strong track record of project management
– 9b13m019 9b13m020 is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Diverse revenue streams
– 9b13m019 9b13m020 is present in almost all the verticals within the industry. This has provided firm in Volvo Construction Equipment: Managing a Plant Closure (A) 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
– Volvo Construction Equipment: Managing a Plant Closure (A) firm has clearly differentiated products in the market place. This has enabled 9b13m019 9b13m020 to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped 9b13m019 9b13m020 to invest into research and development (R&D) and innovation.
Learning organization
- 9b13m019 9b13m020 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 9b13m019 9b13m020 is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Volvo Construction Equipment: Managing a Plant Closure (A) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to lead change in Leadership & Managing People field
– 9b13m019 9b13m020 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 9b13m019 9b13m020 in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High switching costs
– The high switching costs that 9b13m019 9b13m020 has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Operational resilience
– The operational resilience strategy in the Volvo Construction Equipment: Managing a Plant Closure (A) Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Effective Research and Development (R&D)
– 9b13m019 9b13m020 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 Volvo Construction Equipment: Managing a Plant Closure (A) - 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
– 9b13m019 9b13m020 has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. 9b13m019 9b13m020 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 Volvo Construction Equipment: Managing a Plant Closure (A) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Volvo Construction Equipment: Managing a Plant Closure (A) are -
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Volvo Construction Equipment: Managing a Plant Closure (A), it seems that the employees of 9b13m019 9b13m020 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.
Lack of clear differentiation of 9b13m019 9b13m020 products
– To increase the profitability and margins on the products, 9b13m019 9b13m020 needs to provide more differentiated products than what it is currently offering in the marketplace.
Products dominated business model
– Even though 9b13m019 9b13m020 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 - Volvo Construction Equipment: Managing a Plant Closure (A) 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 Volvo Construction Equipment: Managing a Plant Closure (A) 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 9b13m019 9b13m020 has relatively successful track record of launching new products.
No frontier risks strategy
– After analyzing the HBR case study Volvo Construction Equipment: Managing a Plant Closure (A), 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.
Interest costs
– Compare to the competition, 9b13m019 9b13m020 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.
Need for greater diversity
– 9b13m019 9b13m020 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.
Slow decision making process
– As mentioned earlier in the report, 9b13m019 9b13m020 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. 9b13m019 9b13m020 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Mary Weil, Ken Mark suggests that, 9b13m019 9b13m020 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.
Capital Spending Reduction
– Even during the low interest decade, 9b13m019 9b13m020 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 cash cycle compare to competitors
9b13m019 9b13m020 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.
Opportunities Volvo Construction Equipment: Managing a Plant Closure (A) | 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 Volvo Construction Equipment: Managing a Plant Closure (A) are -
Using analytics as competitive advantage
– 9b13m019 9b13m020 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 Volvo Construction Equipment: Managing a Plant Closure (A) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help 9b13m019 9b13m020 to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Building a culture of innovation
– managers at 9b13m019 9b13m020 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.
Loyalty marketing
– 9b13m019 9b13m020 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.
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. 9b13m019 9b13m020 can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Buying journey improvements
– 9b13m019 9b13m020 can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Volvo Construction Equipment: Managing a Plant Closure (A) 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, 9b13m019 9b13m020 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, 9b13m019 9b13m020 is facing challenges because of the dominance of functional experts in the organization. Volvo Construction Equipment: Managing a Plant Closure (A) 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.
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 9b13m019 9b13m020 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for 9b13m019 9b13m020 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.
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. 9b13m019 9b13m020 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. 9b13m019 9b13m020 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.
Creating value in data economy
– The success of analytics program of 9b13m019 9b13m020 has opened avenues for new revenue streams for the organization in the industry. This can help 9b13m019 9b13m020 to build a more holistic ecosystem as suggested in the Volvo Construction Equipment: Managing a Plant Closure (A) case study. 9b13m019 9b13m020 can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Developing new processes and practices
– 9b13m019 9b13m020 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects 9b13m019 9b13m020 can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Volvo Construction Equipment: Managing a Plant Closure (A) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Volvo Construction Equipment: Managing a Plant Closure (A) are -
Environmental challenges
– 9b13m019 9b13m020 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. 9b13m019 9b13m020 can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Shortening product life cycle
– it is one of the major threat that 9b13m019 9b13m020 is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents 9b13m019 9b13m020 with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Regulatory challenges
– 9b13m019 9b13m020 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.
Increasing wage structure of 9b13m019 9b13m020
– 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 9b13m019 9b13m020.
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.
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 9b13m019 9b13m020.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Volvo Construction Equipment: Managing a Plant Closure (A), 9b13m019 9b13m020 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 .
Stagnating economy with rate increase
– 9b13m019 9b13m020 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.
High dependence on third party suppliers
– 9b13m019 9b13m020 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, 9b13m019 9b13m020 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 Volvo Construction Equipment: Managing a Plant Closure (A) .
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. 9b13m019 9b13m020 needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
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. 9b13m019 9b13m020 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 Volvo Construction Equipment: Managing a Plant Closure (A) 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 Volvo Construction Equipment: Managing a Plant Closure (A) 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 Volvo Construction Equipment: Managing a Plant Closure (A) 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 Volvo Construction Equipment: Managing a Plant Closure (A) 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 Volvo Construction Equipment: Managing a Plant Closure (A) 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 9b13m019 9b13m020 needs to make to build a sustainable competitive advantage.