From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation
The case describes the evolution between 1999 and 2008 of a family-owned contract manufacturing company into a publicly traded, US$400 million global firm. The son of the founder, Bernie Auyung, assumed the CEO position with the company during this period and has worked with his father to build a broader, professional management team. In the process the company has applied a range of leading-edge innovation management and strategy tools that put it far ahead of most Chinese peer companies. Computime provides an exceptional model for other companies in developing countries looking to evolve from a low-cost competitor into a global leading company with its own technologies and brands. Students are asked to assume Bernie's role and suggest the path forward. The teaching note describes what the team actually did, and addresses the questions raised at the end of the case.
Swot Analysis of "From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation" written by Robert C. Wolcott, Michael J. Lippitz includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Computime Auyung facing as an external strategic factors. Some of the topics covered in From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation case study are - Strategic Management Strategies, Balanced scorecard, Branding, Growth strategy, Innovation, Technology and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation casestudy better are - – increasing commodity prices, wage bills are increasing, increasing transportation and logistics costs, supply chains are disrupted by pandemic , customer relationship management is fast transforming because of increasing concerns over data privacy, there is backlash against globalization, banking and financial system is disrupted by Bitcoin and other crypto currencies,
central banks are concerned over increasing inflation, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Computime Auyung, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Computime Auyung 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 From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation can be done for the following purposes –
1. Strategic planning using facts provided in From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation case study
2. Improving business portfolio management of Computime Auyung
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 Computime Auyung
Strengths From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Computime Auyung in From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation Harvard Business Review case study are -
Effective Research and Development (R&D)
– Computime Auyung 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 From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Strong track record of project management
– Computime Auyung is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Learning organization
- Computime Auyung 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 Computime Auyung is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Computime Auyung 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.
Low bargaining power of suppliers
– Suppliers of Computime Auyung in the sector have low bargaining power. From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Computime Auyung to manage not only supply disruptions but also source products at highly competitive prices.
Innovation driven organization
– Computime Auyung is one of the most innovative firm in sector. Manager in From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Organizational Resilience of Computime Auyung
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Computime Auyung does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Superior customer experience
– The customer experience strategy of Computime Auyung in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High switching costs
– The high switching costs that Computime Auyung 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.
Highly skilled collaborators
– Computime Auyung 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 From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Operational resilience
– The operational resilience strategy in the From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation 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.
Diverse revenue streams
– Computime Auyung is present in almost all the verticals within the industry. This has provided firm in From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation 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.
Weaknesses From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation 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 Computime Auyung has relatively successful track record of launching new products.
Need for greater diversity
– Computime Auyung 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 to strategic competitive environment developments
– As From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation HBR case study mentions - Computime Auyung 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 bargaining power of channel partners
– Because of the regulatory requirements, Robert C. Wolcott, Michael J. Lippitz suggests that, Computime Auyung 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation, it seems that the employees of Computime Auyung 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 Computime Auyung products
– To increase the profitability and margins on the products, Computime Auyung needs to provide more differentiated products than what it is currently offering in the marketplace.
Products dominated business model
– Even though Computime Auyung 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 - From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation should strive to include more intangible value offerings along with its core products and services.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation, is just above the industry average. Computime Auyung 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation, in the dynamic environment Computime Auyung has struggled to respond to the nimble upstart competition. Computime Auyung has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Increasing silos among functional specialists
– The organizational structure of Computime Auyung is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Computime Auyung needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Computime Auyung to focus more on services rather than just following the product oriented approach.
High operating costs
– Compare to the competitors, firm in the HBR case study From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation 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 Computime Auyung 's lucrative customers.
Opportunities From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation | 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 From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation are -
Building a culture of innovation
– managers at Computime Auyung 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Computime Auyung is facing challenges because of the dominance of functional experts in the organization. From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation 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
– Computime Auyung 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 From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Computime Auyung to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Buying journey improvements
– Computime Auyung can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation 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.
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 Computime Auyung 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.
Better consumer reach
– The expansion of the 5G network will help Computime Auyung to increase its market reach. Computime Auyung 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Computime Auyung 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 Computime Auyung to hire the very best people irrespective of their geographical location.
Learning at scale
– Online learning technologies has now opened space for Computime Auyung 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.
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. Computime Auyung can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Loyalty marketing
– Computime Auyung 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Computime Auyung 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.
Manufacturing automation
– Computime Auyung 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.
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 Computime Auyung in the consumer business. Now Computime Auyung can target international markets with far fewer capital restrictions requirements than the existing system.
Threats From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation are -
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.
Shortening product life cycle
– it is one of the major threat that Computime Auyung is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Regulatory challenges
– Computime Auyung 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Computime Auyung with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Computime Auyung in the Leadership & Managing People sector and impact the bottomline of the organization.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation, Computime Auyung 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 .
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. Computime Auyung can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Environmental challenges
– Computime Auyung 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. Computime Auyung can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
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. Computime Auyung 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 Computime Auyung 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.
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 Computime Auyung.
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. Computime Auyung 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.
Technology acceleration in Forth Industrial Revolution
– Computime Auyung has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Computime Auyung needs to keep up with the evolution of technology in the Leadership & Managing People sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Weighted SWOT Analysis of From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation 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 From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation 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 From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation 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 From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation 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 From Low Cost to Global Leadership: Computime (Hong Kong) Leads Through Innovation 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 Computime Auyung needs to make to build a sustainable competitive advantage.
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