Challenging Sports Authority in Puerto Rico SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Challenging Sports Authority in Puerto Rico
Shooting & Outdoor Distributor (SOD) was a Puerto Rican family-owned wholesale business selling sporting goods for hunting and fishing. After a year of working for the company, the operations manager was confronted with the arrival of a U.S. retail chain, Sports Authority (SA), to the Puerto Rican market. SA carried many sporting goods sold by SOD, as well as a number of brands under exclusive distribution agreements between SOD and its U.S. manufacturers. Even though SA was a retailer, due to its size, it had the power to negotiate better prices with manufacturers than SOD and pass those deals on to the final customer. SOD's operations manager was considering three options for combating this competition: 1) Develop private branding for a new rifle product; 2) Open SOD retail stores not operating close to SA or to its retail clients; and/or 3) Expand SOD to other Latin American and Caribbean markets where no competition was present. Shirley Ann Molina is affiliated with Graduate School of Business University of Puerto Rico. Victor Quinones is affiliated with University of Puerto Rico.
Authors :: Shirley Ann Molina, Valerie Rivera Lozada, Victor Quinones
Swot Analysis of "Challenging Sports Authority in Puerto Rico" written by Shirley Ann Molina, Valerie Rivera Lozada, Victor Quinones includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Sod Puerto facing as an external strategic factors. Some of the topics covered in Challenging Sports Authority in Puerto Rico case study are - Strategic Management Strategies, and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Challenging Sports Authority in Puerto Rico casestudy better are - – challanges to central banks by blockchain based private currencies, increasing commodity prices, increasing transportation and logistics costs, increasing energy prices, digital marketing is dominated by two big players Facebook and Google, geopolitical disruptions, supply chains are disrupted by pandemic ,
there is backlash against globalization, technology disruption, etc
Introduction to SWOT Analysis of Challenging Sports Authority in Puerto Rico
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Challenging Sports Authority in Puerto Rico case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Sod Puerto, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Sod Puerto 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 Challenging Sports Authority in Puerto Rico can be done for the following purposes –
1. Strategic planning using facts provided in Challenging Sports Authority in Puerto Rico case study
2. Improving business portfolio management of Sod Puerto
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 Sod Puerto
Strengths Challenging Sports Authority in Puerto Rico | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Sod Puerto in Challenging Sports Authority in Puerto Rico Harvard Business Review case study are -
High switching costs
– The high switching costs that Sod Puerto 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 Sod Puerto
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Sod Puerto does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to lead change in Sales & Marketing field
– Sod Puerto 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 Sod Puerto in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Strong track record of project management
– Sod Puerto is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Effective Research and Development (R&D)
– Sod Puerto 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 Challenging Sports Authority in Puerto Rico - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Highly skilled collaborators
– Sod Puerto 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 Challenging Sports Authority in Puerto Rico HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High brand equity
– Sod Puerto has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Sod Puerto to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to recruit top talent
– Sod Puerto is one of the leading recruiters in the industry. Managers in the Challenging Sports Authority in Puerto Rico are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Training and development
– Sod Puerto has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Challenging Sports Authority in Puerto Rico 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
- Sod Puerto 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 Sod Puerto is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Challenging Sports Authority in Puerto Rico Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– Sod Puerto is one of the most innovative firm in sector. Manager in Challenging Sports Authority in Puerto Rico 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
– Sod Puerto has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Sod Puerto 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.
Weaknesses Challenging Sports Authority in Puerto Rico | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Challenging Sports Authority in Puerto Rico are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Sod Puerto is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Challenging Sports Authority in Puerto Rico can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Slow decision making process
– As mentioned earlier in the report, Sod Puerto 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. Sod Puerto 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.
Low market penetration in new markets
– Outside its home market of Sod Puerto, firm in the HBR case study Challenging Sports Authority in Puerto Rico needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Workers concerns about automation
– As automation is fast increasing in the segment, Sod Puerto 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 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 Sod Puerto supply chain. Even after few cautionary changes mentioned in the HBR case study - Challenging Sports Authority in Puerto Rico, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Sod Puerto vulnerable to further global disruptions in South East Asia.
Increasing silos among functional specialists
– The organizational structure of Sod Puerto is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Sod Puerto needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Sod Puerto 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 Challenging Sports Authority in Puerto Rico, is just above the industry average. Sod Puerto 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Challenging Sports Authority in Puerto Rico 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 Sod Puerto has relatively successful track record of launching new products.
Products dominated business model
– Even though Sod Puerto 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 - Challenging Sports Authority in Puerto Rico should strive to include more intangible value offerings along with its core products and services.
High cash cycle compare to competitors
Sod Puerto 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.
Slow to strategic competitive environment developments
– As Challenging Sports Authority in Puerto Rico HBR case study mentions - Sod Puerto takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Opportunities Challenging Sports Authority in Puerto Rico | 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 Challenging Sports Authority in Puerto Rico are -
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. Sod Puerto 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. Sod Puerto can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Sod Puerto can use these opportunities to build new business models that can help the communities that Sod Puerto operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Leveraging digital technologies
– Sod Puerto 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Sod Puerto 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 Sod Puerto to hire the very best people irrespective of their geographical location.
Buying journey improvements
– Sod Puerto can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Challenging Sports Authority in Puerto Rico 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, Sod Puerto is facing challenges because of the dominance of functional experts in the organization. Challenging Sports Authority in Puerto Rico 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Sod Puerto 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.
Using analytics as competitive advantage
– Sod Puerto 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 Challenging Sports Authority in Puerto Rico - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Sod Puerto to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Creating value in data economy
– The success of analytics program of Sod Puerto has opened avenues for new revenue streams for the organization in the industry. This can help Sod Puerto to build a more holistic ecosystem as suggested in the Challenging Sports Authority in Puerto Rico case study. Sod Puerto can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at Sod Puerto 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.
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. Sod Puerto can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 Sod Puerto in the consumer business. Now Sod Puerto can target international markets with far fewer capital restrictions requirements than the existing system.
Manufacturing automation
– Sod Puerto 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 Challenging Sports Authority in Puerto Rico External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Challenging Sports Authority in Puerto Rico are -
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 Sod Puerto.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Sod Puerto 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.
Stagnating economy with rate increase
– Sod Puerto 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
– Sod Puerto 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.
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 Sod Puerto in the Sales & Marketing sector and impact the bottomline of the organization.
Environmental challenges
– Sod Puerto 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. Sod Puerto can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Consumer confidence and its impact on Sod Puerto 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Challenging Sports Authority in Puerto Rico, Sod Puerto 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.
Regulatory challenges
– Sod Puerto 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.
Shortening product life cycle
– it is one of the major threat that Sod Puerto is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Sod Puerto needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
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.
Weighted SWOT Analysis of Challenging Sports Authority in Puerto Rico 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 Challenging Sports Authority in Puerto Rico 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 Challenging Sports Authority in Puerto Rico 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 Challenging Sports Authority in Puerto Rico 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 Challenging Sports Authority in Puerto Rico 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 Sod Puerto needs to make to build a sustainable competitive advantage.
