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 - – geopolitical disruptions, increasing inequality as vast percentage of new income is going to the top 1%, supply chains are disrupted by pandemic , challanges to central banks by blockchain based private currencies, competitive advantages are harder to sustain because of technology dispersion, banking and financial system is disrupted by Bitcoin and other crypto currencies, wage bills are increasing,
talent flight as more people leaving formal jobs, 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 -
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.
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.
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.
Superior customer experience
– The customer experience strategy of Sod Puerto in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Diverse revenue streams
– Sod Puerto is present in almost all the verticals within the industry. This has provided firm in Challenging Sports Authority in Puerto Rico 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.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Sod Puerto digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Sod Puerto 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.
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.
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.
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.
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.
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.
Sustainable margins compare to other players in Sales & Marketing industry
– Challenging Sports Authority in Puerto Rico firm has clearly differentiated products in the market place. This has enabled Sod Puerto to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Sod Puerto to invest into research and development (R&D) and innovation.
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 -
High operating costs
– Compare to the competitors, firm in the HBR case study Challenging Sports Authority in Puerto Rico 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 Sod Puerto 's lucrative customers.
No frontier risks strategy
– After analyzing the HBR case study Challenging Sports Authority in Puerto Rico, it seems that company is thinking about the frontier risks that can impact Sales & Marketing strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Challenging Sports Authority in Puerto Rico, in the dynamic environment Sod Puerto has struggled to respond to the nimble upstart competition. Sod Puerto has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
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.
Skills based hiring
– The stress on hiring functional specialists at Sod Puerto 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 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Shirley Ann Molina, Valerie Rivera Lozada, Victor Quinones suggests that, Sod Puerto 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.
Lack of clear differentiation of Sod Puerto products
– To increase the profitability and margins on the products, Sod Puerto needs to provide more differentiated products than what it is currently offering in the marketplace.
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.
Capital Spending Reduction
– Even during the low interest decade, Sod Puerto 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 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 -
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.
Better consumer reach
– The expansion of the 5G network will help Sod Puerto to increase its market reach. Sod Puerto 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.
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. Sod Puerto can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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.
Developing new processes and practices
– Sod Puerto 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 Sod Puerto 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.
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.
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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Sod Puerto can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Loyalty marketing
– Sod Puerto 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Sod Puerto 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, Challenging Sports Authority in Puerto Rico, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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.
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.
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 -
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. Sod Puerto 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.
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.
Technology acceleration in Forth Industrial Revolution
– Sod Puerto has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Sod Puerto 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.
Easy access to finance
– Easy access to finance in Sales & Marketing field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Sod Puerto can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Sod Puerto with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
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.
Increasing wage structure of Sod Puerto
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Sod Puerto.
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.
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.
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.