Cree Inc.: Introducing the LED Light Bulb, Spanish Version SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Cree Inc.: Introducing the LED Light Bulb, Spanish Version
Cree, a North Carolina-based maker of light emitting diodes (LEDs), has just introduced its first consumer product - an LED light bulb. It is designed as an energy efficient replacement for the ubiquitous incandescent light bulb. But given that it is an unfamiliar technology and that it costs ten times what an incandescent bulb costs, there are questions about how best to promote adoption and what sales level might be expected.
Swot Analysis of "Cree Inc.: Introducing the LED Light Bulb, Spanish Version" written by John Gourville, Michael Norris includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Bulb Incandescent facing as an external strategic factors. Some of the topics covered in Cree Inc.: Introducing the LED Light Bulb, Spanish Version case study are - Strategic Management Strategies, Marketing, Sales and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Cree Inc.: Introducing the LED Light Bulb, Spanish Version casestudy better are - – digital marketing is dominated by two big players Facebook and Google, there is backlash against globalization, wage bills are increasing, increasing inequality as vast percentage of new income is going to the top 1%, supply chains are disrupted by pandemic , increasing commodity prices, there is increasing trade war between United States & China,
competitive advantages are harder to sustain because of technology dispersion, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of Cree Inc.: Introducing the LED Light Bulb, Spanish Version
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Cree Inc.: Introducing the LED Light Bulb, Spanish Version case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Bulb Incandescent, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Bulb Incandescent 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 Cree Inc.: Introducing the LED Light Bulb, Spanish Version can be done for the following purposes –
1. Strategic planning using facts provided in Cree Inc.: Introducing the LED Light Bulb, Spanish Version case study
2. Improving business portfolio management of Bulb Incandescent
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 Bulb Incandescent
Strengths Cree Inc.: Introducing the LED Light Bulb, Spanish Version | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Bulb Incandescent in Cree Inc.: Introducing the LED Light Bulb, Spanish Version Harvard Business Review case study are -
Operational resilience
– The operational resilience strategy in the Cree Inc.: Introducing the LED Light Bulb, Spanish Version Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Successful track record of launching new products
– Bulb Incandescent has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Bulb Incandescent 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.
Low bargaining power of suppliers
– Suppliers of Bulb Incandescent in the sector have low bargaining power. Cree Inc.: Introducing the LED Light Bulb, Spanish Version has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Bulb Incandescent to manage not only supply disruptions but also source products at highly competitive prices.
Diverse revenue streams
– Bulb Incandescent is present in almost all the verticals within the industry. This has provided firm in Cree Inc.: Introducing the LED Light Bulb, Spanish Version 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 switching costs
– The high switching costs that Bulb Incandescent 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.
Effective Research and Development (R&D)
– Bulb Incandescent 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 Cree Inc.: Introducing the LED Light Bulb, Spanish Version - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High brand equity
– Bulb Incandescent has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Bulb Incandescent to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in Sales & Marketing industry
– Cree Inc.: Introducing the LED Light Bulb, Spanish Version firm has clearly differentiated products in the market place. This has enabled Bulb Incandescent to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Bulb Incandescent to invest into research and development (R&D) and innovation.
Analytics focus
– Bulb Incandescent 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 John Gourville, Michael Norris 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.
Learning organization
- Bulb Incandescent 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 Bulb Incandescent is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Cree Inc.: Introducing the LED Light Bulb, Spanish Version Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Organizational Resilience of Bulb Incandescent
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Bulb Incandescent does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– Bulb Incandescent has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Cree Inc.: Introducing the LED Light Bulb, Spanish Version 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.
Weaknesses Cree Inc.: Introducing the LED Light Bulb, Spanish Version | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Cree Inc.: Introducing the LED Light Bulb, Spanish Version are -
Lack of clear differentiation of Bulb Incandescent products
– To increase the profitability and margins on the products, Bulb Incandescent needs to provide more differentiated products than what it is currently offering in the marketplace.
Need for greater diversity
– Bulb Incandescent 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.
No frontier risks strategy
– After analyzing the HBR case study Cree Inc.: Introducing the LED Light Bulb, Spanish Version, 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.
Interest costs
– Compare to the competition, Bulb Incandescent 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Cree Inc.: Introducing the LED Light Bulb, Spanish Version 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 Bulb Incandescent 's lucrative customers.
Low market penetration in new markets
– Outside its home market of Bulb Incandescent, firm in the HBR case study Cree Inc.: Introducing the LED Light Bulb, Spanish Version needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Capital Spending Reduction
– Even during the low interest decade, Bulb Incandescent 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.
High cash cycle compare to competitors
Bulb Incandescent 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Cree Inc.: Introducing the LED Light Bulb, Spanish Version, in the dynamic environment Bulb Incandescent has struggled to respond to the nimble upstart competition. Bulb Incandescent has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High bargaining power of channel partners
– Because of the regulatory requirements, John Gourville, Michael Norris suggests that, Bulb Incandescent 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Cree Inc.: Introducing the LED Light Bulb, Spanish Version, it seems that the employees of Bulb Incandescent don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Opportunities Cree Inc.: Introducing the LED Light Bulb, Spanish Version | 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 Cree Inc.: Introducing the LED Light Bulb, Spanish Version are -
Developing new processes and practices
– Bulb Incandescent 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.
Manufacturing automation
– Bulb Incandescent 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Bulb Incandescent 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 Bulb Incandescent to hire the very best people irrespective of their geographical location.
Creating value in data economy
– The success of analytics program of Bulb Incandescent has opened avenues for new revenue streams for the organization in the industry. This can help Bulb Incandescent to build a more holistic ecosystem as suggested in the Cree Inc.: Introducing the LED Light Bulb, Spanish Version case study. Bulb Incandescent can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– Bulb Incandescent 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 Cree Inc.: Introducing the LED Light Bulb, Spanish Version - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Bulb Incandescent to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Bulb Incandescent is facing challenges because of the dominance of functional experts in the organization. Cree Inc.: Introducing the LED Light Bulb, Spanish Version 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.
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 Bulb Incandescent 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.
Learning at scale
– Online learning technologies has now opened space for Bulb Incandescent to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Leveraging digital technologies
– Bulb Incandescent 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Bulb Incandescent 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.
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. Bulb Incandescent can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Bulb Incandescent 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, Cree Inc.: Introducing the LED Light Bulb, Spanish Version, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Low interest rates
– Even though inflation is raising its head in most developed economies, Bulb Incandescent 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 Cree Inc.: Introducing the LED Light Bulb, Spanish Version External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Cree Inc.: Introducing the LED Light Bulb, Spanish Version are -
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 Bulb Incandescent business can come under increasing regulations regarding data privacy, data security, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Cree Inc.: Introducing the LED Light Bulb, Spanish Version, Bulb Incandescent 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 .
Shortening product life cycle
– it is one of the major threat that Bulb Incandescent is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Bulb Incandescent 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.
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.
Regulatory challenges
– Bulb Incandescent 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. Bulb Incandescent needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Technology acceleration in Forth Industrial Revolution
– Bulb Incandescent has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Bulb Incandescent 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.
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 Bulb Incandescent in the Sales & Marketing sector and impact the bottomline of the organization.
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. Bulb Incandescent 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Bulb Incandescent 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 Cree Inc.: Introducing the LED Light Bulb, Spanish Version .
High dependence on third party suppliers
– Bulb Incandescent 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.
Environmental challenges
– Bulb Incandescent 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. Bulb Incandescent can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Weighted SWOT Analysis of Cree Inc.: Introducing the LED Light Bulb, Spanish Version 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 Cree Inc.: Introducing the LED Light Bulb, Spanish Version 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 Cree Inc.: Introducing the LED Light Bulb, Spanish Version 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 Cree Inc.: Introducing the LED Light Bulb, Spanish Version 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 Cree Inc.: Introducing the LED Light Bulb, Spanish Version 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 Bulb Incandescent needs to make to build a sustainable competitive advantage.
