In December 2012, Amir Peleg, founder and CEO of TaKaDu, reflected on how to position his young firm for the next fiscal year and beyond. The small Israeli startup had developed an innovative software system that used patented algorithms and statistical analysis to detect problems such as leaks, bursts, and faulty equipment within a water utility's infrastructure. Such problems caused significant water and energy loss at many utilities, led to service interruptions for consumers, and were only getting worse as the existing infrastructure aged. Since its founding in 2009, TaKaDu had attracted nine customers from around the world. However, as Peleg and his executive team debated how to allocate funding for the upcoming year, he needed to decide whether to focus on R&D to improve and add to TaKaDu's existing software and become the clear technology leader, or move ahead with its current offering and focus on getting new customers to penetrate the market as quickly as possible before competition intensified. Some in the company called for devoting the bulk of TaKaDu's resources to making the system more easily deployable, as deploying the TaKaDu service with a new customer could take up to two months. Peleg also wondered if the company should continue to pursue sales leads from anywhere in the world, or focus on one geographic market (and if so, what region should he choose)? An Australian water utility had made a public announcement it was accepting bids to implement a smart water network monitoring system and Peleg wanted to discuss if and how aggressively TaKaDu should bid on the contract with his management team. TaKaDu already had one Australian customer, was this the region to focus on?
Swot Analysis of "TaKaDu" written by Elie Ofek, Matthew Preble includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Takadu Peleg facing as an external strategic factors. Some of the topics covered in TaKaDu case study are - Strategic Management Strategies, Customers, Entrepreneurship, Growth strategy, Innovation, Intellectual property, IT and Sales & Marketing.
Some of the macro environment factors that can be used to understand the TaKaDu casestudy better are - – competitive advantages are harder to sustain because of technology dispersion, central banks are concerned over increasing inflation, increasing inequality as vast percentage of new income is going to the top 1%, increasing commodity prices, talent flight as more people leaving formal jobs, digital marketing is dominated by two big players Facebook and Google, geopolitical disruptions,
there is backlash against globalization, increasing transportation and logistics costs, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in TaKaDu case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Takadu Peleg, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Takadu Peleg 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 TaKaDu can be done for the following purposes –
1. Strategic planning using facts provided in TaKaDu case study
2. Improving business portfolio management of Takadu Peleg
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Takadu Peleg
Strengths TaKaDu | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Takadu Peleg in TaKaDu Harvard Business Review case study are -
Strong track record of project management
– Takadu Peleg is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Superior customer experience
– The customer experience strategy of Takadu Peleg in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– Takadu Peleg has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in TaKaDu 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
– Takadu Peleg has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Takadu Peleg 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.
Innovation driven organization
– Takadu Peleg is one of the most innovative firm in sector. Manager in TaKaDu Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
High switching costs
– The high switching costs that Takadu Peleg 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.
Organizational Resilience of Takadu Peleg
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Takadu Peleg does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Operational resilience
– The operational resilience strategy in the TaKaDu 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.
Ability to recruit top talent
– Takadu Peleg is one of the leading recruiters in the industry. Managers in the TaKaDu are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Low bargaining power of suppliers
– Suppliers of Takadu Peleg in the sector have low bargaining power. TaKaDu has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Takadu Peleg to manage not only supply disruptions but also source products at highly competitive prices.
Sustainable margins compare to other players in Sales & Marketing industry
– TaKaDu firm has clearly differentiated products in the market place. This has enabled Takadu Peleg to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Takadu Peleg to invest into research and development (R&D) and innovation.
High brand equity
– Takadu Peleg has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Takadu Peleg to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses TaKaDu | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of TaKaDu are -
Skills based hiring
– The stress on hiring functional specialists at Takadu Peleg 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 Takadu Peleg supply chain. Even after few cautionary changes mentioned in the HBR case study - TaKaDu, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Takadu Peleg vulnerable to further global disruptions in South East Asia.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study TaKaDu, in the dynamic environment Takadu Peleg has struggled to respond to the nimble upstart competition. Takadu Peleg has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Low market penetration in new markets
– Outside its home market of Takadu Peleg, firm in the HBR case study TaKaDu needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High cash cycle compare to competitors
Takadu Peleg 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.
Aligning sales with marketing
– It come across in the case study TaKaDu 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 TaKaDu can leverage the sales team experience to cultivate customer relationships as Takadu Peleg is planning to shift buying processes online.
No frontier risks strategy
– After analyzing the HBR case study TaKaDu, it seems that company is thinking about the frontier risks that can impact Sales & Marketing 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Takadu Peleg is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study TaKaDu can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the TaKaDu 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 Takadu Peleg has relatively successful track record of launching new products.
Products dominated business model
– Even though Takadu Peleg 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 - TaKaDu should strive to include more intangible value offerings along with its core products and services.
Increasing silos among functional specialists
– The organizational structure of Takadu Peleg is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Takadu Peleg needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Takadu Peleg to focus more on services rather than just following the product oriented approach.
Opportunities TaKaDu | 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 TaKaDu are -
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. Takadu Peleg 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 Takadu Peleg in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Sales & Marketing segment, and it will provide faster access to the consumers.
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 Takadu Peleg 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.
Leveraging digital technologies
– Takadu Peleg 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.
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 Takadu Peleg in the consumer business. Now Takadu Peleg can target international markets with far fewer capital restrictions requirements than the existing system.
Loyalty marketing
– Takadu Peleg 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.
Using analytics as competitive advantage
– Takadu Peleg 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 TaKaDu - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Takadu Peleg to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Manufacturing automation
– Takadu Peleg can use the latest technology developments to improve its manufacturing and designing process in Sales & Marketing 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Sales & Marketing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Takadu Peleg 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. Takadu Peleg 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.
Learning at scale
– Online learning technologies has now opened space for Takadu Peleg 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Takadu Peleg 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, TaKaDu, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Sales & Marketing industry, but it has also influenced the consumer preferences. Takadu Peleg can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Developing new processes and practices
– Takadu Peleg can develop new processes and procedures in Sales & Marketing 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.
Threats TaKaDu External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study TaKaDu are -
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 Takadu Peleg business can come under increasing regulations regarding data privacy, data security, etc.
Consumer confidence and its impact on Takadu Peleg 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Takadu Peleg in the Sales & Marketing industry. The Sales & Marketing 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.
Environmental challenges
– Takadu Peleg 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. Takadu Peleg can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Increasing wage structure of Takadu Peleg
– 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 Takadu Peleg.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Takadu Peleg 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 TaKaDu .
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.
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. Takadu Peleg 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.
Technology acceleration in Forth Industrial Revolution
– Takadu Peleg has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Takadu Peleg needs to keep up with the evolution of technology in the Sales & Marketing 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 Takadu Peleg is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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.
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 Takadu Peleg.
High dependence on third party suppliers
– Takadu Peleg 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.
Weighted SWOT Analysis of TaKaDu 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 TaKaDu 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 TaKaDu 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 TaKaDu 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 TaKaDu 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 Takadu Peleg needs to make to build a sustainable competitive advantage.
