We Create Chemistry: How Collaboration and Teams Changed BASF SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of We Create Chemistry: How Collaboration and Teams Changed BASF
How does change happen at a company that by all accounts was doing well under successful leadership? In this case, the story of BASF North America (NA) is shared with all references relating to significant change in the regional organization. Adopting strategic change at the leadership level, cascading the change strategy to those executing it, and receiving full support from the top are almost textbook-worthy elements of the change effort that occurred at BASF NA. BASF NA had changed significantly since the creation of the North American 2020 Strategy. Now the management team found itself at a time of further reflection-where was the organization by 2014? And more important, how would the company continue to move forward to 2020 and beyond?
Swot Analysis of "We Create Chemistry: How Collaboration and Teams Changed BASF" written by Lynn A. Isabella, Gerry Yemen includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Basf Na facing as an external strategic factors. Some of the topics covered in We Create Chemistry: How Collaboration and Teams Changed BASF case study are - Strategic Management Strategies, Design, Leading teams and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the We Create Chemistry: How Collaboration and Teams Changed BASF casestudy better are - – cloud computing is disrupting traditional business models, increasing inequality as vast percentage of new income is going to the top 1%, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing household debt because of falling income levels, increasing commodity prices, wage bills are increasing, central banks are concerned over increasing inflation,
increasing energy prices, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of We Create Chemistry: How Collaboration and Teams Changed BASF
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in We Create Chemistry: How Collaboration and Teams Changed BASF case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Basf Na, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Basf Na 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 We Create Chemistry: How Collaboration and Teams Changed BASF can be done for the following purposes –
1. Strategic planning using facts provided in We Create Chemistry: How Collaboration and Teams Changed BASF case study
2. Improving business portfolio management of Basf Na
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 Basf Na
Strengths We Create Chemistry: How Collaboration and Teams Changed BASF | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Basf Na in We Create Chemistry: How Collaboration and Teams Changed BASF Harvard Business Review case study are -
Innovation driven organization
– Basf Na is one of the most innovative firm in sector. Manager in We Create Chemistry: How Collaboration and Teams Changed BASF 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
– Basf Na has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Basf Na 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.
Learning organization
- Basf Na 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 Basf Na is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in We Create Chemistry: How Collaboration and Teams Changed BASF Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Effective Research and Development (R&D)
– Basf Na 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 We Create Chemistry: How Collaboration and Teams Changed BASF - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Training and development
– Basf Na has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in We Create Chemistry: How Collaboration and Teams Changed BASF 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.
High switching costs
– The high switching costs that Basf Na 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.
Analytics focus
– Basf Na 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 Lynn A. Isabella, 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.
Diverse revenue streams
– Basf Na is present in almost all the verticals within the industry. This has provided firm in We Create Chemistry: How Collaboration and Teams Changed BASF 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
– We Create Chemistry: How Collaboration and Teams Changed BASF firm has clearly differentiated products in the market place. This has enabled Basf Na to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Basf Na to invest into research and development (R&D) and innovation.
High brand equity
– Basf Na has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Basf Na to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Strong track record of project management
– Basf Na is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Highly skilled collaborators
– Basf Na 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 We Create Chemistry: How Collaboration and Teams Changed BASF HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses We Create Chemistry: How Collaboration and Teams Changed BASF | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of We Create Chemistry: How Collaboration and Teams Changed BASF are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Basf Na is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study We Create Chemistry: How Collaboration and Teams Changed BASF can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study We Create Chemistry: How Collaboration and Teams Changed BASF, is just above the industry average. Basf Na 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 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 Basf Na supply chain. Even after few cautionary changes mentioned in the HBR case study - We Create Chemistry: How Collaboration and Teams Changed BASF, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Basf Na vulnerable to further global disruptions in South East Asia.
High operating costs
– Compare to the competitors, firm in the HBR case study We Create Chemistry: How Collaboration and Teams Changed BASF 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 Basf Na 's lucrative customers.
Skills based hiring
– The stress on hiring functional specialists at Basf Na 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.
Aligning sales with marketing
– It come across in the case study We Create Chemistry: How Collaboration and Teams Changed BASF 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 We Create Chemistry: How Collaboration and Teams Changed BASF can leverage the sales team experience to cultivate customer relationships as Basf Na is planning to shift buying processes online.
Products dominated business model
– Even though Basf Na 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 - We Create Chemistry: How Collaboration and Teams Changed BASF should strive to include more intangible value offerings along with its core products and services.
Interest costs
– Compare to the competition, Basf Na 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 We Create Chemistry: How Collaboration and Teams Changed BASF, 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.
Capital Spending Reduction
– Even during the low interest decade, Basf Na 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 star products
– The top 2 products and services of the firm as mentioned in the We Create Chemistry: How Collaboration and Teams Changed BASF 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 Basf Na has relatively successful track record of launching new products.
Opportunities We Create Chemistry: How Collaboration and Teams Changed BASF | 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 We Create Chemistry: How Collaboration and Teams Changed BASF are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Basf Na 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 Basf Na to hire the very best people irrespective of their geographical location.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Basf Na can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Basf Na 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.
Leveraging digital technologies
– Basf Na 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.
Creating value in data economy
– The success of analytics program of Basf Na has opened avenues for new revenue streams for the organization in the industry. This can help Basf Na to build a more holistic ecosystem as suggested in the We Create Chemistry: How Collaboration and Teams Changed BASF case study. Basf Na 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
– Basf Na 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Basf Na can use these opportunities to build new business models that can help the communities that Basf Na operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
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. Basf Na 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. Basf Na 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Basf Na is facing challenges because of the dominance of functional experts in the organization. We Create Chemistry: How Collaboration and Teams Changed BASF 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.
Using analytics as competitive advantage
– Basf Na 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 We Create Chemistry: How Collaboration and Teams Changed BASF - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Basf Na to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Basf Na can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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. Basf Na 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
– Basf Na 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.
Threats We Create Chemistry: How Collaboration and Teams Changed BASF External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study We Create Chemistry: How Collaboration and Teams Changed BASF are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Basf Na 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.
Environmental challenges
– Basf Na 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. Basf Na can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study We Create Chemistry: How Collaboration and Teams Changed BASF, Basf Na 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 .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Basf Na with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Stagnating economy with rate increase
– Basf Na 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.
Technology acceleration in Forth Industrial Revolution
– Basf Na has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Basf Na 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.
Regulatory challenges
– Basf Na 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.
Consumer confidence and its impact on Basf Na 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.
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.
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 Basf Na.
High dependence on third party suppliers
– Basf Na 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. Basf Na can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of We Create Chemistry: How Collaboration and Teams Changed BASF 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 We Create Chemistry: How Collaboration and Teams Changed BASF 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 We Create Chemistry: How Collaboration and Teams Changed BASF 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 We Create Chemistry: How Collaboration and Teams Changed BASF 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 We Create Chemistry: How Collaboration and Teams Changed BASF 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 Basf Na needs to make to build a sustainable competitive advantage.