Case Study Description of 23andMe: Genetic Testing For Consumers (A)
To maximize their effectiveness, color cases should be printed in color.On November 22, 2013, the direct-to-consumer genetic testing provider, 23andMe, received a letter from the U.S. Food and Drug Administration (FDA) ordering the company to halt the sale and promotion of its genetic testing kit. The FDA stated that the product was marketed as a diagnostic and preventative tool and that it was subject to the agency's regulations for medical devices. Company co-founder Anne Wojcicki and chairman Andy Page carefully considered the potential impact of the FDA's letter on 23andMe's position in the industry and the sustainability of its operations.
Swot Analysis of "23andMe: Genetic Testing For Consumers (A)" written by John A. Quelch, Margaret Rodriguez includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Genetic 23andme facing as an external strategic factors. Some of the topics covered in 23andMe: Genetic Testing For Consumers (A) case study are - Strategic Management Strategies, Marketing, Product development, Strategy and Sales & Marketing.
Some of the macro environment factors that can be used to understand the 23andMe: Genetic Testing For Consumers (A) casestudy better are - – increasing government debt because of Covid-19 spendings, increasing household debt because of falling income levels, banking and financial system is disrupted by Bitcoin and other crypto currencies, supply chains are disrupted by pandemic , there is increasing trade war between United States & China, talent flight as more people leaving formal jobs, increasing inequality as vast percentage of new income is going to the top 1%,
cloud computing is disrupting traditional business models, wage bills are increasing, etc
Introduction to SWOT Analysis of 23andMe: Genetic Testing For Consumers (A)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in 23andMe: Genetic Testing For Consumers (A) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Genetic 23andme, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Genetic 23andme 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 23andMe: Genetic Testing For Consumers (A) can be done for the following purposes –
1. Strategic planning using facts provided in 23andMe: Genetic Testing For Consumers (A) case study
2. Improving business portfolio management of Genetic 23andme
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 Genetic 23andme
Strengths 23andMe: Genetic Testing For Consumers (A) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Genetic 23andme in 23andMe: Genetic Testing For Consumers (A) Harvard Business Review case study are -
Sustainable margins compare to other players in Sales & Marketing industry
– 23andMe: Genetic Testing For Consumers (A) firm has clearly differentiated products in the market place. This has enabled Genetic 23andme to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Genetic 23andme to invest into research and development (R&D) and innovation.
Low bargaining power of suppliers
– Suppliers of Genetic 23andme in the sector have low bargaining power. 23andMe: Genetic Testing For Consumers (A) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Genetic 23andme to manage not only supply disruptions but also source products at highly competitive prices.
Innovation driven organization
– Genetic 23andme is one of the most innovative firm in sector. Manager in 23andMe: Genetic Testing For Consumers (A) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Ability to lead change in Sales & Marketing field
– Genetic 23andme 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 Genetic 23andme in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Effective Research and Development (R&D)
– Genetic 23andme 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 23andMe: Genetic Testing For Consumers (A) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Diverse revenue streams
– Genetic 23andme is present in almost all the verticals within the industry. This has provided firm in 23andMe: Genetic Testing For Consumers (A) 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 Genetic 23andme in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Organizational Resilience of Genetic 23andme
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Genetic 23andme does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Genetic 23andme is one of the leading recruiters in the industry. Managers in the 23andMe: Genetic Testing For Consumers (A) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Genetic 23andme digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Genetic 23andme 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 Genetic 23andme 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.
Learning organization
- Genetic 23andme is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Genetic 23andme is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in 23andMe: Genetic Testing For Consumers (A) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses 23andMe: Genetic Testing For Consumers (A) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of 23andMe: Genetic Testing For Consumers (A) are -
Interest costs
– Compare to the competition, Genetic 23andme 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.
Increasing silos among functional specialists
– The organizational structure of Genetic 23andme is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Genetic 23andme needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Genetic 23andme to focus more on services rather than just following the product oriented approach.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study 23andMe: Genetic Testing For Consumers (A), is just above the industry average. Genetic 23andme 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.
Skills based hiring
– The stress on hiring functional specialists at Genetic 23andme 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 Genetic 23andme supply chain. Even after few cautionary changes mentioned in the HBR case study - 23andMe: Genetic Testing For Consumers (A), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Genetic 23andme vulnerable to further global disruptions in South East Asia.
Products dominated business model
– Even though Genetic 23andme 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 - 23andMe: Genetic Testing For Consumers (A) should strive to include more intangible value offerings along with its core products and services.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study 23andMe: Genetic Testing For Consumers (A), it seems that the employees of Genetic 23andme don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Genetic 23andme is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study 23andMe: Genetic Testing For Consumers (A) 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 bargaining power of channel partners
– Because of the regulatory requirements, John A. Quelch, Margaret Rodriguez suggests that, Genetic 23andme 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Genetic 23andme needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
High operating costs
– Compare to the competitors, firm in the HBR case study 23andMe: Genetic Testing For Consumers (A) 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 Genetic 23andme 's lucrative customers.
Opportunities 23andMe: Genetic Testing For Consumers (A) | 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 23andMe: Genetic Testing For Consumers (A) are -
Developing new processes and practices
– Genetic 23andme 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Genetic 23andme 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.
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. Genetic 23andme 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. Genetic 23andme 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 Genetic 23andme 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.
Building a culture of innovation
– managers at Genetic 23andme 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 Sales & Marketing segment.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Genetic 23andme 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 Genetic 23andme to hire the very best people irrespective of their geographical location.
Buying journey improvements
– Genetic 23andme can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. 23andMe: Genetic Testing For Consumers (A) 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Genetic 23andme is facing challenges because of the dominance of functional experts in the organization. 23andMe: Genetic Testing For Consumers (A) 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.
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. Genetic 23andme 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 Genetic 23andme can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Better consumer reach
– The expansion of the 5G network will help Genetic 23andme to increase its market reach. Genetic 23andme 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.
Using analytics as competitive advantage
– Genetic 23andme 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 23andMe: Genetic Testing For Consumers (A) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Genetic 23andme to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Manufacturing automation
– Genetic 23andme 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.
Threats 23andMe: Genetic Testing For Consumers (A) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study 23andMe: Genetic Testing For Consumers (A) are -
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 Genetic 23andme in the Sales & Marketing sector and impact the bottomline of the organization.
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.
Shortening product life cycle
– it is one of the major threat that Genetic 23andme is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study 23andMe: Genetic Testing For Consumers (A), Genetic 23andme may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Sales & Marketing .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Genetic 23andme 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.
Regulatory challenges
– Genetic 23andme 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 Sales & Marketing industry regulations.
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. Genetic 23andme 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.
Environmental challenges
– Genetic 23andme 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. Genetic 23andme can take advantage of this fund but it will also bring new competitors in the Sales & Marketing 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 dependence on third party suppliers
– Genetic 23andme 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Genetic 23andme with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Genetic 23andme 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 23andMe: Genetic Testing For Consumers (A) .
Technology acceleration in Forth Industrial Revolution
– Genetic 23andme has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Genetic 23andme 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.
Weighted SWOT Analysis of 23andMe: Genetic Testing For Consumers (A) 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 23andMe: Genetic Testing For Consumers (A) 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 23andMe: Genetic Testing For Consumers (A) 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 23andMe: Genetic Testing For Consumers (A) 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 23andMe: Genetic Testing For Consumers (A) 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 Genetic 23andme needs to make to build a sustainable competitive advantage.
