Upgrading the Supply Chain Management Strategy at Sichuan Telecom SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Upgrading the Supply Chain Management Strategy at Sichuan Telecom
In the process of business development, many enterprises have to deal with issues from all dimensions of operations management including inventory management, distribution management, and network design. Sichuan Telecom, a branch of China Telecom Co. Ltd., which was a Fortune Global 500 company, achieved its highest market share in its broadband business and maintained strong growth momentum in this segment. However, there was a serious inventory management problem concerning ADSL modems, a component that most broadband users required. The problem was that Sichuan Telecom's ADSL modem inventory was either too high or insufficient. To reduce inventory costs and improve the service level, the procurement manager conducted a comprehensive analysis of the company's sales and demand forecasting, procurement and suppliers, distribution management, warehouse management, and inventory management. This case follows the procurement manager in analyzing the company's existing operational management system for ADSL modems in order to discover the cause of the inventory problem and develop an effective plan to improve operations management.
Authors :: Chen Xu, Zhang Du, Li Zheng, Ding Yichao
Swot Analysis of "Upgrading the Supply Chain Management Strategy at Sichuan Telecom" written by Chen Xu, Zhang Du, Li Zheng, Ding Yichao includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Adsl Inventory facing as an external strategic factors. Some of the topics covered in Upgrading the Supply Chain Management Strategy at Sichuan Telecom case study are - Strategic Management Strategies, and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Upgrading the Supply Chain Management Strategy at Sichuan Telecom casestudy better are - – increasing transportation and logistics costs, cloud computing is disrupting traditional business models, increasing energy prices, banking and financial system is disrupted by Bitcoin and other crypto currencies, there is backlash against globalization, increasing government debt because of Covid-19 spendings, increasing inequality as vast percentage of new income is going to the top 1%,
digital marketing is dominated by two big players Facebook and Google, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of Upgrading the Supply Chain Management Strategy at Sichuan Telecom
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Upgrading the Supply Chain Management Strategy at Sichuan Telecom case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Adsl Inventory, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Adsl Inventory 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 Upgrading the Supply Chain Management Strategy at Sichuan Telecom can be done for the following purposes –
1. Strategic planning using facts provided in Upgrading the Supply Chain Management Strategy at Sichuan Telecom case study
2. Improving business portfolio management of Adsl Inventory
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 Adsl Inventory
Strengths Upgrading the Supply Chain Management Strategy at Sichuan Telecom | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Adsl Inventory in Upgrading the Supply Chain Management Strategy at Sichuan Telecom Harvard Business Review case study are -
Effective Research and Development (R&D)
– Adsl Inventory 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 Upgrading the Supply Chain Management Strategy at Sichuan Telecom - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Organizational Resilience of Adsl Inventory
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Adsl Inventory does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Sustainable margins compare to other players in Leadership & Managing People industry
– Upgrading the Supply Chain Management Strategy at Sichuan Telecom firm has clearly differentiated products in the market place. This has enabled Adsl Inventory to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Adsl Inventory to invest into research and development (R&D) and innovation.
Operational resilience
– The operational resilience strategy in the Upgrading the Supply Chain Management Strategy at Sichuan Telecom 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.
High switching costs
– The high switching costs that Adsl Inventory 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.
Training and development
– Adsl Inventory has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Upgrading the Supply Chain Management Strategy at Sichuan Telecom 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.
Successful track record of launching new products
– Adsl Inventory has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Adsl Inventory 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
- Adsl Inventory 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 Adsl Inventory is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Upgrading the Supply Chain Management Strategy at Sichuan Telecom Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Low bargaining power of suppliers
– Suppliers of Adsl Inventory in the sector have low bargaining power. Upgrading the Supply Chain Management Strategy at Sichuan Telecom has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Adsl Inventory to manage not only supply disruptions but also source products at highly competitive prices.
Strong track record of project management
– Adsl Inventory is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to recruit top talent
– Adsl Inventory is one of the leading recruiters in the industry. Managers in the Upgrading the Supply Chain Management Strategy at Sichuan Telecom are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Innovation driven organization
– Adsl Inventory is one of the most innovative firm in sector. Manager in Upgrading the Supply Chain Management Strategy at Sichuan Telecom Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Weaknesses Upgrading the Supply Chain Management Strategy at Sichuan Telecom | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Upgrading the Supply Chain Management Strategy at Sichuan Telecom are -
High bargaining power of channel partners
– Because of the regulatory requirements, Chen Xu, Zhang Du, Li Zheng, Ding Yichao suggests that, Adsl Inventory 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Adsl Inventory is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Upgrading the Supply Chain Management Strategy at Sichuan Telecom can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Slow to strategic competitive environment developments
– As Upgrading the Supply Chain Management Strategy at Sichuan Telecom HBR case study mentions - Adsl Inventory 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.
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 Adsl Inventory supply chain. Even after few cautionary changes mentioned in the HBR case study - Upgrading the Supply Chain Management Strategy at Sichuan Telecom, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Adsl Inventory vulnerable to further global disruptions in South East Asia.
Aligning sales with marketing
– It come across in the case study Upgrading the Supply Chain Management Strategy at Sichuan Telecom 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 Upgrading the Supply Chain Management Strategy at Sichuan Telecom can leverage the sales team experience to cultivate customer relationships as Adsl Inventory is planning to shift buying processes online.
Increasing silos among functional specialists
– The organizational structure of Adsl Inventory is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Adsl Inventory needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Adsl Inventory to focus more on services rather than just following the product oriented approach.
Need for greater diversity
– Adsl Inventory 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 Adsl Inventory 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 - Upgrading the Supply Chain Management Strategy at Sichuan Telecom should strive to include more intangible value offerings along with its core products and services.
High operating costs
– Compare to the competitors, firm in the HBR case study Upgrading the Supply Chain Management Strategy at Sichuan Telecom 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 Adsl Inventory 's lucrative customers.
Slow decision making process
– As mentioned earlier in the report, Adsl Inventory 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. Adsl Inventory 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 cash cycle compare to competitors
Adsl Inventory 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 Upgrading the Supply Chain Management Strategy at Sichuan Telecom | 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 Upgrading the Supply Chain Management Strategy at Sichuan Telecom are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Adsl Inventory 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, Upgrading the Supply Chain Management Strategy at Sichuan Telecom, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Leveraging digital technologies
– Adsl Inventory 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.
Learning at scale
– Online learning technologies has now opened space for Adsl Inventory 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.
Better consumer reach
– The expansion of the 5G network will help Adsl Inventory to increase its market reach. Adsl Inventory 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.
Buying journey improvements
– Adsl Inventory can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Upgrading the Supply Chain Management Strategy at Sichuan Telecom 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.
Building a culture of innovation
– managers at Adsl Inventory 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Adsl Inventory 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Adsl Inventory can use these opportunities to build new business models that can help the communities that Adsl Inventory operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Developing new processes and practices
– Adsl Inventory 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.
Creating value in data economy
– The success of analytics program of Adsl Inventory has opened avenues for new revenue streams for the organization in the industry. This can help Adsl Inventory to build a more holistic ecosystem as suggested in the Upgrading the Supply Chain Management Strategy at Sichuan Telecom case study. Adsl Inventory can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Adsl Inventory in the consumer business. Now Adsl Inventory can target international markets with far fewer capital restrictions requirements than the existing system.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Adsl Inventory can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Using analytics as competitive advantage
– Adsl Inventory 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 Upgrading the Supply Chain Management Strategy at Sichuan Telecom - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Adsl Inventory to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Upgrading the Supply Chain Management Strategy at Sichuan Telecom External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Upgrading the Supply Chain Management Strategy at Sichuan Telecom are -
Environmental challenges
– Adsl Inventory 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. Adsl Inventory can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
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 Adsl Inventory.
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.
High dependence on third party suppliers
– Adsl Inventory 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.
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. Adsl Inventory 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.
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 Adsl Inventory in the Leadership & Managing People sector and impact the bottomline of the organization.
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.
Technology acceleration in Forth Industrial Revolution
– Adsl Inventory has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Adsl Inventory 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. Adsl Inventory can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Adsl Inventory needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Consumer confidence and its impact on Adsl Inventory 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.
Stagnating economy with rate increase
– Adsl Inventory 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.
Increasing wage structure of Adsl Inventory
– 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 Adsl Inventory.
Weighted SWOT Analysis of Upgrading the Supply Chain Management Strategy at Sichuan Telecom 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 Upgrading the Supply Chain Management Strategy at Sichuan Telecom 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 Upgrading the Supply Chain Management Strategy at Sichuan Telecom 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 Upgrading the Supply Chain Management Strategy at Sichuan Telecom 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 Upgrading the Supply Chain Management Strategy at Sichuan Telecom 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 Adsl Inventory needs to make to build a sustainable competitive advantage.