Pak Elektron Limited: Converting Systems to ERP SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Pak Elektron Limited: Converting Systems to ERP
Pak Elektron Limited was a prominent manufacturer of consumer home appliances, large distribution and power transformers, and switch gears for power companies in Pakistan. From 2007, the company had started the process of changing the information systems of the company. These systems had become outdated as Microsoft withdrew its support of Visual FoxPro, the platform on which all systems had been developed. The company decided that a Tier 1 ERP (enterprise resource planning) system with strength in manufacturing modules would be suitable. An ERP system was then selected and a firm was appointed as implementer in December 2009. The case describes the issues surrounding the implementation, including many unexpected events. It presents the situation as of the fourth quarter of 2011, after Phase 1 of the implementation had finished in December 2010 and the company had decided in March 2011 to dispense with the services of the consulting firm supporting the implementation. Pak Elektron Limited was facing a liquidity crisis and had to save costs even though there was insufficient corporate knowledge of ERP procedures. The staff was not comfortable with the ERP system and would not let go of the legacy systems and, as such, the project was in trouble.
Swot Analysis of "Pak Elektron Limited: Converting Systems to ERP" written by Muntazar B. Ahmed includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Erp Elektron facing as an external strategic factors. Some of the topics covered in Pak Elektron Limited: Converting Systems to ERP case study are - Strategic Management Strategies, Leadership, Organizational culture and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Pak Elektron Limited: Converting Systems to ERP casestudy better are - – there is backlash against globalization, increasing commodity prices, banking and financial system is disrupted by Bitcoin and other crypto currencies, talent flight as more people leaving formal jobs, geopolitical disruptions, supply chains are disrupted by pandemic , increasing energy prices,
central banks are concerned over increasing inflation, wage bills are increasing, etc
Introduction to SWOT Analysis of Pak Elektron Limited: Converting Systems to ERP
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Pak Elektron Limited: Converting Systems to ERP case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Erp Elektron, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Erp Elektron 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 Pak Elektron Limited: Converting Systems to ERP can be done for the following purposes –
1. Strategic planning using facts provided in Pak Elektron Limited: Converting Systems to ERP case study
2. Improving business portfolio management of Erp Elektron
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 Erp Elektron
Strengths Pak Elektron Limited: Converting Systems to ERP | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Erp Elektron in Pak Elektron Limited: Converting Systems to ERP Harvard Business Review case study are -
Highly skilled collaborators
– Erp Elektron 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 Pak Elektron Limited: Converting Systems to ERP HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Training and development
– Erp Elektron has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Pak Elektron Limited: Converting Systems to ERP 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.
Effective Research and Development (R&D)
– Erp Elektron 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 Pak Elektron Limited: Converting Systems to ERP - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Learning organization
- Erp Elektron 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 Erp Elektron is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Pak Elektron Limited: Converting Systems to ERP Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Erp Elektron digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Erp Elektron has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Low bargaining power of suppliers
– Suppliers of Erp Elektron in the sector have low bargaining power. Pak Elektron Limited: Converting Systems to ERP has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Erp Elektron to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that Erp Elektron 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.
High brand equity
– Erp Elektron has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Erp Elektron to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in Leadership & Managing People industry
– Pak Elektron Limited: Converting Systems to ERP firm has clearly differentiated products in the market place. This has enabled Erp Elektron to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Erp Elektron to invest into research and development (R&D) and innovation.
Ability to lead change in Leadership & Managing People field
– Erp Elektron 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 Erp Elektron in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Diverse revenue streams
– Erp Elektron is present in almost all the verticals within the industry. This has provided firm in Pak Elektron Limited: Converting Systems to ERP 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.
Cross disciplinary teams
– Horizontal connected teams at the Erp Elektron 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.
Weaknesses Pak Elektron Limited: Converting Systems to ERP | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Pak Elektron Limited: Converting Systems to ERP are -
Need for greater diversity
– Erp Elektron 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.
No frontier risks strategy
– After analyzing the HBR case study Pak Elektron Limited: Converting Systems to ERP, 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Pak Elektron Limited: Converting Systems to ERP, it seems that the employees of Erp Elektron 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Pak Elektron Limited: Converting Systems to ERP, in the dynamic environment Erp Elektron has struggled to respond to the nimble upstart competition. Erp Elektron has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow decision making process
– As mentioned earlier in the report, Erp Elektron 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. Erp Elektron 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.
Low market penetration in new markets
– Outside its home market of Erp Elektron, firm in the HBR case study Pak Elektron Limited: Converting Systems to ERP needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Interest costs
– Compare to the competition, Erp Elektron 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.
Products dominated business model
– Even though Erp Elektron 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 - Pak Elektron Limited: Converting Systems to ERP should strive to include more intangible value offerings along with its core products and services.
Skills based hiring
– The stress on hiring functional specialists at Erp Elektron 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Erp Elektron 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Erp Elektron is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Pak Elektron Limited: Converting Systems to ERP can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities Pak Elektron Limited: Converting Systems to ERP | 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 Pak Elektron Limited: Converting Systems to ERP are -
Learning at scale
– Online learning technologies has now opened space for Erp Elektron 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.
Using analytics as competitive advantage
– Erp Elektron 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 Pak Elektron Limited: Converting Systems to ERP - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Erp Elektron to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Erp Elektron 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. Erp Elektron 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.
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 Erp Elektron 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.
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. Erp Elektron can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Better consumer reach
– The expansion of the 5G network will help Erp Elektron to increase its market reach. Erp Elektron 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
– Erp Elektron can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Pak Elektron Limited: Converting Systems to ERP 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Erp Elektron 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 Erp Elektron to hire the very best people irrespective of their geographical location.
Developing new processes and practices
– Erp Elektron 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.
Manufacturing automation
– Erp Elektron 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.
Leveraging digital technologies
– Erp Elektron 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Erp Elektron 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, Pak Elektron Limited: Converting Systems to ERP, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Loyalty marketing
– Erp Elektron 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.
Threats Pak Elektron Limited: Converting Systems to ERP External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Pak Elektron Limited: Converting Systems to ERP are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Erp Elektron 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.
Shortening product life cycle
– it is one of the major threat that Erp Elektron is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Erp Elektron.
Consumer confidence and its impact on Erp Elektron 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.
Environmental challenges
– Erp Elektron 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. Erp Elektron can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
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.
Stagnating economy with rate increase
– Erp Elektron 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Pak Elektron Limited: Converting Systems to ERP, Erp Elektron 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 .
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. Erp Elektron needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
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.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Erp Elektron business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Erp Elektron 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.
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 Erp Elektron in the Leadership & Managing People sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Pak Elektron Limited: Converting Systems to ERP 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 Pak Elektron Limited: Converting Systems to ERP 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 Pak Elektron Limited: Converting Systems to ERP 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 Pak Elektron Limited: Converting Systems to ERP 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 Pak Elektron Limited: Converting Systems to ERP 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 Erp Elektron needs to make to build a sustainable competitive advantage.
