Preferred Customer Service at US Airways SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Preferred Customer Service at US Airways
Repatriation of the previously off-shored call center operations of the US Airlines was being completed in the summer of 2011. Reservation Director of the East Region considered this to be an opportunity to high quality and faster service to the "preferred customers" by establishing a preferred customer desk at the Winston-Salem Center. The headquarters has asked the director to provide an in-depth analysis of the proposal's costs and benefits before it can be approved. The wider question of the case is to cogitate whether this initiative has merit. Is it likely to provide enough advantages (both quantifiable such as shorter average wait times and non-quantifiable such as the perception by the customers of the service quality) to justify any additional personnel costs? The call centers operate 24/7 and experience varying call volumes. This causes the required number of agents to economically achieve some targeted average wait times to greatly fluctuate during each time increment (e.g., each hour). Therefore the case, more narrowly, focuses on the challenges of (1) the fundamental trade-off between wait times and agent utilization; and (2) scheduling of the start times of the standard 8-hour shifts to provide adequate coverage during each period. The Instructor's manual provides extensive analyses based on multiserver queuing models and linear programming of these technical issues. In addition, the case provides rich opportunities to discuss human resource strategies and their role in securing competitive advantage.
Swot Analysis of "Preferred Customer Service at US Airways" written by Umit Akinc includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Preferred Wait facing as an external strategic factors. Some of the topics covered in Preferred Customer Service at US Airways case study are - Strategic Management Strategies, Customer service, Developing employees, Operations management and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Preferred Customer Service at US Airways casestudy better are - – supply chains are disrupted by pandemic , there is backlash against globalization, competitive advantages are harder to sustain because of technology dispersion, increasing household debt because of falling income levels, talent flight as more people leaving formal jobs, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing commodity prices,
geopolitical disruptions, technology disruption, etc
Introduction to SWOT Analysis of Preferred Customer Service at US Airways
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Preferred Customer Service at US Airways case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Preferred Wait, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Preferred Wait 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 Preferred Customer Service at US Airways can be done for the following purposes –
1. Strategic planning using facts provided in Preferred Customer Service at US Airways case study
2. Improving business portfolio management of Preferred Wait
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 Preferred Wait
Strengths Preferred Customer Service at US Airways | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Preferred Wait in Preferred Customer Service at US Airways Harvard Business Review case study are -
High brand equity
– Preferred Wait has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Preferred Wait to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Preferred Wait is present in almost all the verticals within the industry. This has provided firm in Preferred Customer Service at US Airways 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.
Ability to lead change in Leadership & Managing People field
– Preferred Wait 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 Preferred Wait in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Ability to recruit top talent
– Preferred Wait is one of the leading recruiters in the industry. Managers in the Preferred Customer Service at US Airways are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Effective Research and Development (R&D)
– Preferred Wait 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 Preferred Customer Service at US Airways - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Preferred Wait digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Preferred Wait 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.
Cross disciplinary teams
– Horizontal connected teams at the Preferred Wait 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.
Training and development
– Preferred Wait has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Preferred Customer Service at US Airways 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.
Highly skilled collaborators
– Preferred Wait 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 Preferred Customer Service at US Airways HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of Preferred Wait
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Preferred Wait 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 Preferred Wait in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Sustainable margins compare to other players in Leadership & Managing People industry
– Preferred Customer Service at US Airways firm has clearly differentiated products in the market place. This has enabled Preferred Wait to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Preferred Wait to invest into research and development (R&D) and innovation.
Weaknesses Preferred Customer Service at US Airways | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Preferred Customer Service at US Airways are -
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Preferred Customer Service at US Airways, is just above the industry average. Preferred Wait 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.
Increasing silos among functional specialists
– The organizational structure of Preferred Wait is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Preferred Wait needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Preferred Wait to focus more on services rather than just following the product oriented approach.
Interest costs
– Compare to the competition, Preferred Wait 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.
Slow decision making process
– As mentioned earlier in the report, Preferred Wait 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. Preferred Wait 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.
Skills based hiring
– The stress on hiring functional specialists at Preferred Wait 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.
High cash cycle compare to competitors
Preferred Wait 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Preferred Customer Service at US Airways 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 Preferred Wait has relatively successful track record of launching new products.
Need for greater diversity
– Preferred Wait 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 harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Preferred Wait is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Preferred Customer Service at US Airways can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Low market penetration in new markets
– Outside its home market of Preferred Wait, firm in the HBR case study Preferred Customer Service at US Airways needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Lack of clear differentiation of Preferred Wait products
– To increase the profitability and margins on the products, Preferred Wait needs to provide more differentiated products than what it is currently offering in the marketplace.
Opportunities Preferred Customer Service at US Airways | 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 Preferred Customer Service at US Airways are -
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. Preferred Wait 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. Preferred Wait 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.
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 Preferred Wait in the consumer business. Now Preferred Wait can target international markets with far fewer capital restrictions requirements than the existing system.
Building a culture of innovation
– managers at Preferred Wait 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, Preferred Wait is facing challenges because of the dominance of functional experts in the organization. Preferred Customer Service at US Airways 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Preferred Wait can use these opportunities to build new business models that can help the communities that Preferred Wait operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Developing new processes and practices
– Preferred Wait 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Preferred Wait can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Using analytics as competitive advantage
– Preferred Wait 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 Preferred Customer Service at US Airways - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Preferred Wait to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Preferred Wait 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.
Creating value in data economy
– The success of analytics program of Preferred Wait has opened avenues for new revenue streams for the organization in the industry. This can help Preferred Wait to build a more holistic ecosystem as suggested in the Preferred Customer Service at US Airways case study. Preferred Wait can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Preferred Wait can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Loyalty marketing
– Preferred Wait 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.
Buying journey improvements
– Preferred Wait can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Preferred Customer Service at US Airways 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.
Threats Preferred Customer Service at US Airways External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Preferred Customer Service at US Airways are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Preferred Wait with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Environmental challenges
– Preferred Wait 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. Preferred Wait can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
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. Preferred Wait can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Shortening product life cycle
– it is one of the major threat that Preferred Wait is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing wage structure of Preferred Wait
– 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 Preferred Wait.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Preferred Wait 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.
Technology acceleration in Forth Industrial Revolution
– Preferred Wait has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Preferred Wait 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.
High dependence on third party suppliers
– Preferred Wait 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 Preferred Wait in the Leadership & Managing People sector and impact the bottomline of the organization.
Stagnating economy with rate increase
– Preferred Wait 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.
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 Preferred Wait business can come under increasing regulations regarding data privacy, data security, etc.
Consumer confidence and its impact on Preferred Wait 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.
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.
Weighted SWOT Analysis of Preferred Customer Service at US Airways 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 Preferred Customer Service at US Airways 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 Preferred Customer Service at US Airways 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 Preferred Customer Service at US Airways 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 Preferred Customer Service at US Airways 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 Preferred Wait needs to make to build a sustainable competitive advantage.