BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team
The case describes the evolution between 1999 and 2005 of an unusual innovation team within the office of the Chief Information Officer of BP. The team leader, Vice President and Chief Technology Officer (CTO) Phiroz Darukhanavala ("Daru"), eschewed a large group and a venture budget in favor of a small, lean team intimately engaged with BP's business units. The case described several mechanisms created by the CTO office during its early evolution, aimed at expanding executives' appreciation of emerging technology capabilities, building a network of relationships through which emerging technologies are scouted and vetted, and providing structured mechanisms for technology transfer. In late 2005 the CIO's Advisory Group challenged the CTO office to "keep reinventing yourselves." Students are asked to assume Daru's role and suggest new processes and structures to continue the evolution of the CTO office. The teaching note describes what the team actually did, and addresses questions raised at the end of the case.
Swot Analysis of "BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team" written by Robert C. Wolcott, Michael J. Lippitz includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Cto Office facing as an external strategic factors. Some of the topics covered in BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team case study are - Strategic Management Strategies, Innovation, International business, Organizational culture, Technology and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team casestudy better are - – wage bills are increasing, increasing transportation and logistics costs, increasing energy prices, there is increasing trade war between United States & China, central banks are concerned over increasing inflation, digital marketing is dominated by two big players Facebook and Google, challanges to central banks by blockchain based private currencies,
customer relationship management is fast transforming because of increasing concerns over data privacy, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Cto Office, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Cto Office 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 BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team can be done for the following purposes –
1. Strategic planning using facts provided in BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team case study
2. Improving business portfolio management of Cto Office
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 Cto Office
Strengths BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Cto Office in BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team Harvard Business Review case study are -
Sustainable margins compare to other players in Leadership & Managing People industry
– BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team firm has clearly differentiated products in the market place. This has enabled Cto Office to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Cto Office to invest into research and development (R&D) and innovation.
High brand equity
– Cto Office has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Cto Office to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Cto Office digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Cto Office 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.
Analytics focus
– Cto Office 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 Robert C. Wolcott, Michael J. Lippitz 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.
Training and development
– Cto Office has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team 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
– Cto Office has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Cto Office 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.
Ability to recruit top talent
– Cto Office is one of the leading recruiters in the industry. Managers in the BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Diverse revenue streams
– Cto Office is present in almost all the verticals within the industry. This has provided firm in BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team 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.
Superior customer experience
– The customer experience strategy of Cto Office in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Cto Office 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 BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Low bargaining power of suppliers
– Suppliers of Cto Office in the sector have low bargaining power. BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Cto Office to manage not only supply disruptions but also source products at highly competitive prices.
Organizational Resilience of Cto Office
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Cto Office does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team are -
Aligning sales with marketing
– It come across in the case study BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team 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 BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team can leverage the sales team experience to cultivate customer relationships as Cto Office is planning to shift buying processes online.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team, is just above the industry average. Cto Office needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
High operating costs
– Compare to the competitors, firm in the HBR case study BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team 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 Cto Office 's lucrative customers.
High bargaining power of channel partners
– Because of the regulatory requirements, Robert C. Wolcott, Michael J. Lippitz suggests that, Cto Office 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.
High cash cycle compare to competitors
Cto Office 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.
Skills based hiring
– The stress on hiring functional specialists at Cto Office 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.
No frontier risks strategy
– After analyzing the HBR case study BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team, it seems that company is thinking about the frontier risks that can impact Leadership & Managing People strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Capital Spending Reduction
– Even during the low interest decade, Cto Office has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
High dependence on 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 Cto Office supply chain. Even after few cautionary changes mentioned in the HBR case study - BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Cto Office vulnerable to further global disruptions in South East Asia.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team 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 Cto Office has relatively successful track record of launching new products.
Products dominated business model
– Even though Cto Office 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 - BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team should strive to include more intangible value offerings along with its core products and services.
Opportunities BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team | 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 BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team are -
Manufacturing automation
– Cto Office 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.
Better consumer reach
– The expansion of the 5G network will help Cto Office to increase its market reach. Cto Office 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Cto Office is facing challenges because of the dominance of functional experts in the organization. BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team 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.
Developing new processes and practices
– Cto Office 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Leadership & Managing People industry, but it has also influenced the consumer preferences. Cto Office can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Cto Office can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Learning at scale
– Online learning technologies has now opened space for Cto Office 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Cto Office 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.
Buying journey improvements
– Cto Office can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team 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 Cto Office 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Cto Office can use these opportunities to build new business models that can help the communities that Cto Office operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Building a culture of innovation
– managers at Cto Office 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.
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. Cto Office can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team are -
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. Cto Office can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
Increasing wage structure of Cto Office
– 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 Cto Office.
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. Cto Office 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.
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 Cto Office.
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 Cto Office business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Cto Office 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Cto Office with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Shortening product life cycle
– it is one of the major threat that Cto Office is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Environmental challenges
– Cto Office 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. Cto Office 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.
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. Cto Office 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 Cto Office 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.
Weighted SWOT Analysis of BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team 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 BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team 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 BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team 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 BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team 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 BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team 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 Cto Office needs to make to build a sustainable competitive advantage.
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