Case Study Description of RA?sonances (A): Selling Products or Dreams?
Surfing on cross of multiple consumer trends, RA?sonances was launched in 2000 as a life-styled retail chain selling authentic/traditional household items. Early 2002, the six stores are still unprofitable. A new owner-manager takes over and gives himself 18 months to turn the company around and instill more "magics" in the stores.
Swot Analysis of "RA?sonances (A): Selling Products or Dreams?" written by Charles Waldman, Anna Perry includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Sonances Ra facing as an external strategic factors. Some of the topics covered in RA?sonances (A): Selling Products or Dreams? case study are - Strategic Management Strategies, and Sales & Marketing.
Some of the macro environment factors that can be used to understand the RA?sonances (A): Selling Products or Dreams? casestudy better are - – there is increasing trade war between United States & China, competitive advantages are harder to sustain because of technology dispersion, increasing inequality as vast percentage of new income is going to the top 1%, increasing energy prices, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing government debt because of Covid-19 spendings, digital marketing is dominated by two big players Facebook and Google,
increasing household debt because of falling income levels, banking and financial system is disrupted by Bitcoin and other crypto currencies, etc
Introduction to SWOT Analysis of RA?sonances (A): Selling Products or Dreams?
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in RA?sonances (A): Selling Products or Dreams? case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Sonances Ra, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Sonances Ra 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 RA?sonances (A): Selling Products or Dreams? can be done for the following purposes –
1. Strategic planning using facts provided in RA?sonances (A): Selling Products or Dreams? case study
2. Improving business portfolio management of Sonances Ra
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 Sonances Ra
Strengths RA?sonances (A): Selling Products or Dreams? | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Sonances Ra in RA?sonances (A): Selling Products or Dreams? Harvard Business Review case study are -
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Sonances Ra digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Sonances Ra 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.
Low bargaining power of suppliers
– Suppliers of Sonances Ra in the sector have low bargaining power. RA?sonances (A): Selling Products or Dreams? has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Sonances Ra to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Sonances Ra in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Analytics focus
– Sonances Ra 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 Charles Waldman, Anna Perry 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.
Successful track record of launching new products
– Sonances Ra has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Sonances Ra 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.
Sustainable margins compare to other players in Sales & Marketing industry
– RA?sonances (A): Selling Products or Dreams? firm has clearly differentiated products in the market place. This has enabled Sonances Ra to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Sonances Ra to invest into research and development (R&D) and innovation.
Ability to recruit top talent
– Sonances Ra is one of the leading recruiters in the industry. Managers in the RA?sonances (A): Selling Products or Dreams? are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Innovation driven organization
– Sonances Ra is one of the most innovative firm in sector. Manager in RA?sonances (A): Selling Products or Dreams? Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Operational resilience
– The operational resilience strategy in the RA?sonances (A): Selling Products or Dreams? 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.
Organizational Resilience of Sonances Ra
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Sonances Ra does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Effective Research and Development (R&D)
– Sonances Ra 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 RA?sonances (A): Selling Products or Dreams? - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Cross disciplinary teams
– Horizontal connected teams at the Sonances Ra are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Weaknesses RA?sonances (A): Selling Products or Dreams? | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of RA?sonances (A): Selling Products or Dreams? are -
High bargaining power of channel partners
– Because of the regulatory requirements, Charles Waldman, Anna Perry suggests that, Sonances Ra 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 to strategic competitive environment developments
– As RA?sonances (A): Selling Products or Dreams? HBR case study mentions - Sonances Ra 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.
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 Sonances Ra supply chain. Even after few cautionary changes mentioned in the HBR case study - RA?sonances (A): Selling Products or Dreams?, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Sonances Ra vulnerable to further global disruptions in South East Asia.
Capital Spending Reduction
– Even during the low interest decade, Sonances Ra 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.
Aligning sales with marketing
– It come across in the case study RA?sonances (A): Selling Products or Dreams? that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case RA?sonances (A): Selling Products or Dreams? can leverage the sales team experience to cultivate customer relationships as Sonances Ra is planning to shift buying processes online.
No frontier risks strategy
– After analyzing the HBR case study RA?sonances (A): Selling Products or Dreams?, 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study RA?sonances (A): Selling Products or Dreams?, in the dynamic environment Sonances Ra has struggled to respond to the nimble upstart competition. Sonances Ra has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Low market penetration in new markets
– Outside its home market of Sonances Ra, firm in the HBR case study RA?sonances (A): Selling Products or Dreams? needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Products dominated business model
– Even though Sonances Ra 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 - RA?sonances (A): Selling Products or Dreams? should strive to include more intangible value offerings along with its core products and services.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study RA?sonances (A): Selling Products or Dreams?, is just above the industry average. Sonances Ra 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.
Lack of clear differentiation of Sonances Ra products
– To increase the profitability and margins on the products, Sonances Ra needs to provide more differentiated products than what it is currently offering in the marketplace.
Opportunities RA?sonances (A): Selling Products or Dreams? | 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 RA?sonances (A): Selling Products or Dreams? are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Sonances Ra 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.
Buying journey improvements
– Sonances Ra can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. RA?sonances (A): Selling Products or Dreams? 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.
Building a culture of innovation
– managers at Sonances Ra 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Sonances Ra is facing challenges because of the dominance of functional experts in the organization. RA?sonances (A): Selling Products or Dreams? 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 Sonances Ra 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.
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. Sonances Ra can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Creating value in data economy
– The success of analytics program of Sonances Ra has opened avenues for new revenue streams for the organization in the industry. This can help Sonances Ra to build a more holistic ecosystem as suggested in the RA?sonances (A): Selling Products or Dreams? case study. Sonances Ra can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Sonances Ra 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, RA?sonances (A): Selling Products or Dreams?, 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
– Sonances Ra 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.
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 Sonances Ra in the consumer business. Now Sonances Ra can target international markets with far fewer capital restrictions requirements than the existing system.
Low interest rates
– Even though inflation is raising its head in most developed economies, Sonances Ra 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 Sonances Ra to increase its market reach. Sonances Ra 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Sonances Ra can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats RA?sonances (A): Selling Products or Dreams? External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study RA?sonances (A): Selling Products or Dreams? are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Sonances Ra 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 RA?sonances (A): Selling Products or Dreams? .
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 Sonances Ra in the Sales & Marketing sector and impact the bottomline of the organization.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study RA?sonances (A): Selling Products or Dreams?, Sonances Ra 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 .
Increasing wage structure of Sonances Ra
– 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 Sonances Ra.
Consumer confidence and its impact on Sonances Ra demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Technology acceleration in Forth Industrial Revolution
– Sonances Ra has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Sonances Ra needs to keep up with the evolution of technology in the Sales & Marketing sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
High dependence on third party suppliers
– Sonances Ra 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.
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. Sonances Ra can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Sonances Ra business can come under increasing regulations regarding data privacy, data security, etc.
Environmental challenges
– Sonances Ra 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. Sonances Ra can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
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 Sonances Ra.
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. Sonances Ra 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.
Shortening product life cycle
– it is one of the major threat that Sonances Ra is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of RA?sonances (A): Selling Products or Dreams? 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 RA?sonances (A): Selling Products or Dreams? 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 RA?sonances (A): Selling Products or Dreams? 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 RA?sonances (A): Selling Products or Dreams? 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 RA?sonances (A): Selling Products or Dreams? 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 Sonances Ra needs to make to build a sustainable competitive advantage.