ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm
ThoughtWorks, a medium-size IT systems integrator, was growing quickly but identified "lack of clear positioning around which to build a brand" as the biggest impediment to continued growth. The company had identified features that it believed differentiated it from its competitors and was considering alternative segments to target. Asks readers to choose a target and develop a positioning statement for that target as well as identify the assumptions underlying the recommended positioning strategy and suggest how market research could help establish the validity of those assumptions.
Swot Analysis of "ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm" written by Alice M. Tybout, Kyle Ragsdale includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Thoughtworks Positioning facing as an external strategic factors. Some of the topics covered in ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm case study are - Strategic Management Strategies, Growth strategy, Market research and Sales & Marketing.
Some of the macro environment factors that can be used to understand the ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm casestudy better are - – there is increasing trade war between United States & China, increasing government debt because of Covid-19 spendings, challanges to central banks by blockchain based private currencies, geopolitical disruptions, banking and financial system is disrupted by Bitcoin and other crypto currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, there is backlash against globalization,
supply chains are disrupted by pandemic , central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Thoughtworks Positioning, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Thoughtworks Positioning 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 ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm can be done for the following purposes –
1. Strategic planning using facts provided in ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm case study
2. Improving business portfolio management of Thoughtworks Positioning
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 Thoughtworks Positioning
Strengths ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Thoughtworks Positioning in ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm Harvard Business Review case study are -
High switching costs
– The high switching costs that Thoughtworks Positioning 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.
Learning organization
- Thoughtworks Positioning 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 Thoughtworks Positioning is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Superior customer experience
– The customer experience strategy of Thoughtworks Positioning in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Thoughtworks Positioning 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 ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Training and development
– Thoughtworks Positioning has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm 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.
Analytics focus
– Thoughtworks Positioning 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 Alice M. Tybout, Kyle Ragsdale 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.
Ability to lead change in Sales & Marketing field
– Thoughtworks Positioning 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 Thoughtworks Positioning in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Cross disciplinary teams
– Horizontal connected teams at the Thoughtworks Positioning 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.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Thoughtworks Positioning digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Thoughtworks Positioning 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.
Effective Research and Development (R&D)
– Thoughtworks Positioning 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 ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm - 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
– Thoughtworks Positioning is present in almost all the verticals within the industry. This has provided firm in ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm 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.
High brand equity
– Thoughtworks Positioning has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Thoughtworks Positioning to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm are -
Lack of clear differentiation of Thoughtworks Positioning products
– To increase the profitability and margins on the products, Thoughtworks Positioning needs to provide more differentiated products than what it is currently offering in the marketplace.
Aligning sales with marketing
– It come across in the case study ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm 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 ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm can leverage the sales team experience to cultivate customer relationships as Thoughtworks Positioning is planning to shift buying processes online.
High operating costs
– Compare to the competitors, firm in the HBR case study ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm 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 Thoughtworks Positioning 's lucrative customers.
High bargaining power of channel partners
– Because of the regulatory requirements, Alice M. Tybout, Kyle Ragsdale suggests that, Thoughtworks Positioning 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.
Interest costs
– Compare to the competition, Thoughtworks Positioning 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 Thoughtworks Positioning 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.
Capital Spending Reduction
– Even during the low interest decade, Thoughtworks Positioning has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Products dominated business model
– Even though Thoughtworks Positioning 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 - ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm should strive to include more intangible value offerings along with its core products and services.
Workers concerns about automation
– As automation is fast increasing in the segment, Thoughtworks Positioning 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm, is just above the industry average. Thoughtworks Positioning 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.
Need for greater diversity
– Thoughtworks Positioning 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 ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm | 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 ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Thoughtworks Positioning 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 Thoughtworks Positioning to hire the very best people irrespective of their geographical location.
Leveraging digital technologies
– Thoughtworks Positioning 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.
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. Thoughtworks Positioning 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. Thoughtworks Positioning 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.
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 Thoughtworks Positioning to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Thoughtworks Positioning can use these opportunities to build new business models that can help the communities that Thoughtworks Positioning operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Better consumer reach
– The expansion of the 5G network will help Thoughtworks Positioning to increase its market reach. Thoughtworks Positioning 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Thoughtworks Positioning 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, ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Developing new processes and practices
– Thoughtworks Positioning 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.
Building a culture of innovation
– managers at Thoughtworks Positioning 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.
Manufacturing automation
– Thoughtworks Positioning 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.
Buying journey improvements
– Thoughtworks Positioning can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm 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.
Loyalty marketing
– Thoughtworks Positioning 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
– Thoughtworks Positioning 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 ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Thoughtworks Positioning to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm are -
Environmental challenges
– Thoughtworks Positioning 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. Thoughtworks Positioning can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Thoughtworks Positioning with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm, Thoughtworks Positioning 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 .
Regulatory challenges
– Thoughtworks Positioning 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.
Stagnating economy with rate increase
– Thoughtworks Positioning 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.
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.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Thoughtworks Positioning 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 ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Thoughtworks Positioning 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.
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. Thoughtworks Positioning 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.
Consumer confidence and its impact on Thoughtworks Positioning 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.
Technology acceleration in Forth Industrial Revolution
– Thoughtworks Positioning has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Thoughtworks Positioning 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.
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. Thoughtworks Positioning needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Weighted SWOT Analysis of ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm 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 ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm 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 ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm 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 ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm 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 ThoughtWorks (A): Targeting and Positioning Basics for a Services Firm 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 Thoughtworks Positioning needs to make to build a sustainable competitive advantage.