American Hospital Supply Corp.: The ASAP System (A) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of American Hospital Supply Corp.: The ASAP System (A)
American Hospital Supply, the largest firm in the U.S. hospital supply industry, has achieved success in part through the use of information systems. Changes in the hospital marketplace suggest a shift in strategy would be appropriate. What role should information systems play in future strategies?
Swot Analysis of "American Hospital Supply Corp.: The ASAP System (A)" written by Michael R. Vitale includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Hospital Supply facing as an external strategic factors. Some of the topics covered in American Hospital Supply Corp.: The ASAP System (A) case study are - Strategic Management Strategies, IT, Marketing and Finance & Accounting.
Some of the macro environment factors that can be used to understand the American Hospital Supply Corp.: The ASAP System (A) casestudy better are - – digital marketing is dominated by two big players Facebook and Google, challanges to central banks by blockchain based private currencies, there is backlash against globalization, wage bills are increasing, customer relationship management is fast transforming because of increasing concerns over data privacy, there is increasing trade war between United States & China, increasing household debt because of falling income levels,
banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of American Hospital Supply Corp.: The ASAP System (A)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in American Hospital Supply Corp.: The ASAP System (A) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Hospital Supply, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Hospital Supply 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 American Hospital Supply Corp.: The ASAP System (A) can be done for the following purposes –
1. Strategic planning using facts provided in American Hospital Supply Corp.: The ASAP System (A) case study
2. Improving business portfolio management of Hospital Supply
3. Assessing feasibility of the new initiative in Finance & Accounting field.
4. Making a Finance & Accounting topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Hospital Supply
Strengths American Hospital Supply Corp.: The ASAP System (A) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Hospital Supply in American Hospital Supply Corp.: The ASAP System (A) Harvard Business Review case study are -
Highly skilled collaborators
– Hospital Supply 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 American Hospital Supply Corp.: The ASAP System (A) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Superior customer experience
– The customer experience strategy of Hospital Supply in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to recruit top talent
– Hospital Supply is one of the leading recruiters in the industry. Managers in the American Hospital Supply Corp.: The ASAP System (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.
High switching costs
– The high switching costs that Hospital Supply 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.
Ability to lead change in Finance & Accounting field
– Hospital Supply 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 Hospital Supply in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Training and development
– Hospital Supply has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in American Hospital Supply Corp.: The ASAP System (A) 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.
Low bargaining power of suppliers
– Suppliers of Hospital Supply in the sector have low bargaining power. American Hospital Supply Corp.: The ASAP System (A) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Hospital Supply to manage not only supply disruptions but also source products at highly competitive prices.
Sustainable margins compare to other players in Finance & Accounting industry
– American Hospital Supply Corp.: The ASAP System (A) firm has clearly differentiated products in the market place. This has enabled Hospital Supply to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Hospital Supply to invest into research and development (R&D) and innovation.
Learning organization
- Hospital Supply 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 Hospital Supply is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in American Hospital Supply Corp.: The ASAP System (A) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Hospital Supply 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.
Analytics focus
– Hospital Supply 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 Michael R. Vitale 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.
Operational resilience
– The operational resilience strategy in the American Hospital Supply Corp.: The ASAP System (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.
Weaknesses American Hospital Supply Corp.: The ASAP System (A) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of American Hospital Supply Corp.: The ASAP System (A) are -
Lack of clear differentiation of Hospital Supply products
– To increase the profitability and margins on the products, Hospital Supply needs to provide more differentiated products than what it is currently offering in the marketplace.
Interest costs
– Compare to the competition, Hospital Supply 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.
Increasing silos among functional specialists
– The organizational structure of Hospital Supply is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Hospital Supply needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Hospital Supply to focus more on services rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As American Hospital Supply Corp.: The ASAP System (A) HBR case study mentions - Hospital Supply 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.
Aligning sales with marketing
– It come across in the case study American Hospital Supply Corp.: The ASAP System (A) 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 American Hospital Supply Corp.: The ASAP System (A) can leverage the sales team experience to cultivate customer relationships as Hospital Supply is planning to shift buying processes online.
Workers concerns about automation
– As automation is fast increasing in the segment, Hospital Supply needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Products dominated business model
– Even though Hospital Supply 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 - American Hospital Supply Corp.: The ASAP System (A) should strive to include more intangible value offerings along with its core products and services.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Hospital Supply is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study American Hospital Supply Corp.: The ASAP System (A) can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study American Hospital Supply Corp.: The ASAP System (A), it seems that the employees of Hospital Supply 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the American Hospital Supply Corp.: The ASAP System (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 Hospital Supply has relatively successful track record of launching new products.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study American Hospital Supply Corp.: The ASAP System (A), is just above the industry average. Hospital Supply 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.
Opportunities American Hospital Supply Corp.: The ASAP System (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 American Hospital Supply Corp.: The ASAP System (A) are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Hospital Supply in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Finance & Accounting segment, and it will provide faster access to the consumers.
Learning at scale
– Online learning technologies has now opened space for Hospital Supply 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.
Manufacturing automation
– Hospital Supply can use the latest technology developments to improve its manufacturing and designing process in Finance & Accounting 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.
Better consumer reach
– The expansion of the 5G network will help Hospital Supply to increase its market reach. Hospital Supply 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Finance & Accounting industry, but it has also influenced the consumer preferences. Hospital Supply can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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. Hospital Supply can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Hospital Supply 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, American Hospital Supply Corp.: The ASAP System (A), 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
– Hospital Supply 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.
Building a culture of innovation
– managers at Hospital Supply 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 Finance & Accounting segment.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Hospital Supply can use these opportunities to build new business models that can help the communities that Hospital Supply operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Finance & Accounting industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Hospital Supply 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. Hospital Supply 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, Hospital Supply is facing challenges because of the dominance of functional experts in the organization. American Hospital Supply Corp.: The ASAP System (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.
Creating value in data economy
– The success of analytics program of Hospital Supply has opened avenues for new revenue streams for the organization in the industry. This can help Hospital Supply to build a more holistic ecosystem as suggested in the American Hospital Supply Corp.: The ASAP System (A) case study. Hospital Supply can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats American Hospital Supply Corp.: The ASAP System (A) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study American Hospital Supply Corp.: The ASAP System (A) are -
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study American Hospital Supply Corp.: The ASAP System (A), Hospital Supply may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Finance & Accounting .
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.
High dependence on third party suppliers
– Hospital Supply 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Hospital Supply in the Finance & Accounting industry. The Finance & Accounting 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Hospital Supply with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Hospital Supply 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.
Environmental challenges
– Hospital Supply 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. Hospital Supply can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Increasing wage structure of Hospital Supply
– 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 Hospital Supply.
Technology acceleration in Forth Industrial Revolution
– Hospital Supply has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Hospital Supply needs to keep up with the evolution of technology in the Finance & Accounting 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Hospital Supply 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 American Hospital Supply Corp.: The ASAP System (A) .
Stagnating economy with rate increase
– Hospital Supply 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.
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 Hospital Supply.
Weighted SWOT Analysis of American Hospital Supply Corp.: The ASAP System (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 American Hospital Supply Corp.: The ASAP System (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 American Hospital Supply Corp.: The ASAP System (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 American Hospital Supply Corp.: The ASAP System (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 American Hospital Supply Corp.: The ASAP System (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 Hospital Supply needs to make to build a sustainable competitive advantage.
