James Houghton and Signature Theatre SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of James Houghton and Signature Theatre
University of California, Berkeley-Haas collectionThe case describes the history of Signature Theatre, started by James Houghton 23 years ago. Signature Theatre is an example of a successful organization with a powerful mission and vision, and one that has stuck to its mission throughout the years. The theater has gone through many stages under Houghton's leadership, eventually growing to a $12 million annual budget with a new $70 million production facility featuring a unique, open community gathering space as a central feature. Along the way, Houghton has become one of the most respected and influential leaders in his field. Please note: this case also has a supplementary case available. The supplement can be found using product number B5800.
Authors :: Laura Callanan, Jane Wei-Skillern, Prentice Onayemi
Swot Analysis of "James Houghton and Signature Theatre" written by Laura Callanan, Jane Wei-Skillern, Prentice Onayemi includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Houghton Theatre facing as an external strategic factors. Some of the topics covered in James Houghton and Signature Theatre case study are - Strategic Management Strategies, Leadership, Social responsibility and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the James Houghton and Signature Theatre casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, central banks are concerned over increasing inflation, there is increasing trade war between United States & China, competitive advantages are harder to sustain because of technology dispersion, increasing transportation and logistics costs, digital marketing is dominated by two big players Facebook and Google, increasing energy prices,
challanges to central banks by blockchain based private currencies, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of James Houghton and Signature Theatre
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in James Houghton and Signature Theatre case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Houghton Theatre, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Houghton Theatre 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 James Houghton and Signature Theatre can be done for the following purposes –
1. Strategic planning using facts provided in James Houghton and Signature Theatre case study
2. Improving business portfolio management of Houghton Theatre
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 Houghton Theatre
Strengths James Houghton and Signature Theatre | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Houghton Theatre in James Houghton and Signature Theatre Harvard Business Review case study are -
Training and development
– Houghton Theatre has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in James Houghton and Signature Theatre 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.
Sustainable margins compare to other players in Leadership & Managing People industry
– James Houghton and Signature Theatre firm has clearly differentiated products in the market place. This has enabled Houghton Theatre to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Houghton Theatre to invest into research and development (R&D) and innovation.
Strong track record of project management
– Houghton Theatre is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Houghton Theatre digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Houghton Theatre 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.
Superior customer experience
– The customer experience strategy of Houghton Theatre in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Effective Research and Development (R&D)
– Houghton Theatre 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 James Houghton and Signature Theatre - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Operational resilience
– The operational resilience strategy in the James Houghton and Signature Theatre 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.
Low bargaining power of suppliers
– Suppliers of Houghton Theatre in the sector have low bargaining power. James Houghton and Signature Theatre has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Houghton Theatre to manage not only supply disruptions but also source products at highly competitive prices.
Analytics focus
– Houghton Theatre 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 Laura Callanan, Jane Wei-Skillern, Prentice Onayemi 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.
Organizational Resilience of Houghton Theatre
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Houghton Theatre does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High switching costs
– The high switching costs that Houghton Theatre 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.
Innovation driven organization
– Houghton Theatre is one of the most innovative firm in sector. Manager in James Houghton and Signature Theatre Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Weaknesses James Houghton and Signature Theatre | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of James Houghton and Signature Theatre are -
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study James Houghton and Signature Theatre, is just above the industry average. Houghton Theatre 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 Houghton Theatre is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Houghton Theatre needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Houghton Theatre to focus more on services rather than just following the product oriented approach.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the James Houghton and Signature Theatre 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 Houghton Theatre has relatively successful track record of launching new products.
Interest costs
– Compare to the competition, Houghton Theatre 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.
Skills based hiring
– The stress on hiring functional specialists at Houghton Theatre 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 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 Houghton Theatre supply chain. Even after few cautionary changes mentioned in the HBR case study - James Houghton and Signature Theatre, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Houghton Theatre vulnerable to further global disruptions in South East Asia.
Low market penetration in new markets
– Outside its home market of Houghton Theatre, firm in the HBR case study James Houghton and Signature Theatre needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study James Houghton and Signature Theatre, in the dynamic environment Houghton Theatre has struggled to respond to the nimble upstart competition. Houghton Theatre has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High operating costs
– Compare to the competitors, firm in the HBR case study James Houghton and Signature Theatre 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 Houghton Theatre 's lucrative customers.
High cash cycle compare to competitors
Houghton Theatre 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.
Need for greater diversity
– Houghton Theatre 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.
Opportunities James Houghton and Signature Theatre | 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 James Houghton and Signature Theatre are -
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. Houghton Theatre can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Houghton Theatre 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 Houghton Theatre to hire the very best people irrespective of their geographical location.
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. Houghton Theatre 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. Houghton Theatre 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Houghton Theatre can use these opportunities to build new business models that can help the communities that Houghton Theatre operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Creating value in data economy
– The success of analytics program of Houghton Theatre has opened avenues for new revenue streams for the organization in the industry. This can help Houghton Theatre to build a more holistic ecosystem as suggested in the James Houghton and Signature Theatre case study. Houghton Theatre can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Better consumer reach
– The expansion of the 5G network will help Houghton Theatre to increase its market reach. Houghton Theatre 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.
Loyalty marketing
– Houghton Theatre 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.
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 Houghton Theatre in the consumer business. Now Houghton Theatre can target international markets with far fewer capital restrictions requirements than the existing system.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Houghton Theatre 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, James Houghton and Signature Theatre, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Houghton Theatre can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Houghton Theatre 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.
Using analytics as competitive advantage
– Houghton Theatre 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 James Houghton and Signature Theatre - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Houghton Theatre to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Low interest rates
– Even though inflation is raising its head in most developed economies, Houghton Theatre 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.
Threats James Houghton and Signature Theatre External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study James Houghton and Signature Theatre 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.
Technology acceleration in Forth Industrial Revolution
– Houghton Theatre has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Houghton Theatre 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.
Shortening product life cycle
– it is one of the major threat that Houghton Theatre is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Regulatory challenges
– Houghton Theatre needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Leadership & Managing People industry regulations.
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. Houghton Theatre can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Houghton Theatre in the Leadership & Managing People sector and impact the bottomline of the organization.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Houghton Theatre 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 James Houghton and Signature Theatre .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Houghton Theatre with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Houghton Theatre needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Houghton Theatre 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study James Houghton and Signature Theatre, Houghton Theatre 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 .
Environmental challenges
– Houghton Theatre 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. Houghton Theatre can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
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. Houghton Theatre 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.
Weighted SWOT Analysis of James Houghton and Signature Theatre 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 James Houghton and Signature Theatre 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 James Houghton and Signature Theatre 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 James Houghton and Signature Theatre 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 James Houghton and Signature Theatre 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 Houghton Theatre needs to make to build a sustainable competitive advantage.