Case Study Description of Marketing the "$100 Laptop" (A)
To maximize their effectiveness, color cases should be printed in color.In 2002, Professor Nicholas Negroponte, a successful venture capitalist, author, and co-founder and chairman emeritus of the Massachusetts Institute of Technology (MIT) Media Lab, announced his intention to build a PC so cheap as to make it possible to provide Internet- and multimedia-capable machines to millions of children in developing countries. The concept--subsequently often referred to as the "$100 PC"--was launched at the Media Lab in 2003 before being spun into a separate nonprofit association, One Laptop Per Child (OLPC), founded by Negroponte in January 2005. At the time skeptics, including technology industry leaders, argued that it simply could not be done. Through innovative design and technology, Negroponte and his team proved them wrong but struggled to sell the concept and the machines to the world's education ministries, who would be purchasing the laptops for their school age children. Furthermore, by 2007, many other low-cost PC options had emerged and OLPC had not started shipping yet, leading some observers to wonder if the non-profit should reconsider its strategy and options
Swot Analysis of "Marketing the "$100 Laptop" (A)" written by John A. Quelch includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Negroponte Olpc facing as an external strategic factors. Some of the topics covered in Marketing the "$100 Laptop" (A) case study are - Strategic Management Strategies, Emerging markets, Internet, IT, Marketing, Product development, Venture capital and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Marketing the "$100 Laptop" (A) casestudy better are - – central banks are concerned over increasing inflation, supply chains are disrupted by pandemic , there is backlash against globalization, technology disruption, challanges to central banks by blockchain based private currencies, geopolitical disruptions, increasing government debt because of Covid-19 spendings,
increasing household debt because of falling income levels, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of Marketing the "$100 Laptop" (A)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Marketing the "$100 Laptop" (A) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Negroponte Olpc, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Negroponte Olpc 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 Marketing the "$100 Laptop" (A) can be done for the following purposes –
1. Strategic planning using facts provided in Marketing the "$100 Laptop" (A) case study
2. Improving business portfolio management of Negroponte Olpc
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 Negroponte Olpc
Strengths Marketing the "$100 Laptop" (A) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Negroponte Olpc in Marketing the "$100 Laptop" (A) Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of Negroponte Olpc in the sector have low bargaining power. Marketing the "$100 Laptop" (A) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Negroponte Olpc to manage not only supply disruptions but also source products at highly competitive prices.
Diverse revenue streams
– Negroponte Olpc is present in almost all the verticals within the industry. This has provided firm in Marketing the "$100 Laptop" (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.
Sustainable margins compare to other players in Sales & Marketing industry
– Marketing the "$100 Laptop" (A) firm has clearly differentiated products in the market place. This has enabled Negroponte Olpc to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Negroponte Olpc to invest into research and development (R&D) and innovation.
Training and development
– Negroponte Olpc has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Marketing the "$100 Laptop" (A) 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.
Learning organization
- Negroponte Olpc 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 Negroponte Olpc is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Marketing the "$100 Laptop" (A) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– Negroponte Olpc is one of the most innovative firm in sector. Manager in Marketing the "$100 Laptop" (A) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Successful track record of launching new products
– Negroponte Olpc has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Negroponte Olpc 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.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Negroponte Olpc digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Negroponte Olpc 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.
Strong track record of project management
– Negroponte Olpc is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to lead change in Sales & Marketing field
– Negroponte Olpc 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 Negroponte Olpc in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Organizational Resilience of Negroponte Olpc
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Negroponte Olpc does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Negroponte Olpc is one of the leading recruiters in the industry. Managers in the Marketing the "$100 Laptop" (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.
Weaknesses Marketing the "$100 Laptop" (A) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Marketing the "$100 Laptop" (A) are -
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 Negroponte Olpc supply chain. Even after few cautionary changes mentioned in the HBR case study - Marketing the "$100 Laptop" (A), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Negroponte Olpc vulnerable to further global disruptions in South East Asia.
Products dominated business model
– Even though Negroponte Olpc 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 - Marketing the "$100 Laptop" (A) should strive to include more intangible value offerings along with its core products and services.
Increasing silos among functional specialists
– The organizational structure of Negroponte Olpc is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Negroponte Olpc needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Negroponte Olpc to focus more on services rather than just following the product oriented approach.
Workers concerns about automation
– As automation is fast increasing in the segment, Negroponte Olpc 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.
Skills based hiring
– The stress on hiring functional specialists at Negroponte Olpc 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 bargaining power of channel partners
– Because of the regulatory requirements, John A. Quelch suggests that, Negroponte Olpc 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.
Slow decision making process
– As mentioned earlier in the report, Negroponte Olpc has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Negroponte Olpc even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Marketing the "$100 Laptop" (A) 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 Negroponte Olpc has relatively successful track record of launching new products.
Lack of clear differentiation of Negroponte Olpc products
– To increase the profitability and margins on the products, Negroponte Olpc needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Negroponte Olpc 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.
Capital Spending Reduction
– Even during the low interest decade, Negroponte Olpc 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.
Opportunities Marketing the "$100 Laptop" (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 Marketing the "$100 Laptop" (A) 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. Negroponte Olpc can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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. Negroponte Olpc can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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 Negroponte Olpc 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Negroponte Olpc 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Negroponte Olpc can use these opportunities to build new business models that can help the communities that Negroponte Olpc 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 Negroponte Olpc to increase its market reach. Negroponte Olpc 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.
Creating value in data economy
– The success of analytics program of Negroponte Olpc has opened avenues for new revenue streams for the organization in the industry. This can help Negroponte Olpc to build a more holistic ecosystem as suggested in the Marketing the "$100 Laptop" (A) case study. Negroponte Olpc can build new products and services such as - data insight services, data privacy related products, data based consulting services, 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 Negroponte Olpc in the consumer business. Now Negroponte Olpc 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, Negroponte Olpc 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, Marketing the "$100 Laptop" (A), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Manufacturing automation
– Negroponte Olpc 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Negroponte Olpc is facing challenges because of the dominance of functional experts in the organization. Marketing the "$100 Laptop" (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.
Developing new processes and practices
– Negroponte Olpc 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Negroponte Olpc 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 Marketing the "$100 Laptop" (A) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Marketing the "$100 Laptop" (A) are -
Regulatory challenges
– Negroponte Olpc 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.
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. Negroponte Olpc needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Marketing the "$100 Laptop" (A), Negroponte Olpc 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 .
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.
Shortening product life cycle
– it is one of the major threat that Negroponte Olpc is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Negroponte Olpc with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Negroponte Olpc 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.
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 Negroponte Olpc in the Sales & Marketing sector and impact the bottomline of the organization.
Stagnating economy with rate increase
– Negroponte Olpc 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.
High dependence on third party suppliers
– Negroponte Olpc 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Negroponte Olpc 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 Marketing the "$100 Laptop" (A) .
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 Negroponte Olpc business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of Marketing the "$100 Laptop" (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 Marketing the "$100 Laptop" (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 Marketing the "$100 Laptop" (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 Marketing the "$100 Laptop" (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 Marketing the "$100 Laptop" (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 Negroponte Olpc needs to make to build a sustainable competitive advantage.
