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 - – increasing transportation and logistics costs, there is increasing trade war between United States & China, technology disruption, central banks are concerned over increasing inflation, increasing inequality as vast percentage of new income is going to the top 1%, competitive advantages are harder to sustain because of technology dispersion, cloud computing is disrupting traditional business models,
increasing energy prices, there is backlash against globalization, 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 -
Highly skilled collaborators
– Sonances Ra 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 RA?sonances (A): Selling Products or Dreams? HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
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.
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.
High brand equity
– Sonances Ra has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Sonances Ra to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
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.
Diverse revenue streams
– Sonances Ra is present in almost all the verticals within the industry. This has provided firm in RA?sonances (A): Selling Products or Dreams? 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 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.
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.
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.
Training and development
– Sonances Ra has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in RA?sonances (A): Selling Products or Dreams? 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
- Sonances Ra 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 Sonances Ra is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in RA?sonances (A): Selling Products or Dreams? Harvard Business Review case study emphasize – knowledge, initiative, 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.
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 -
Slow decision making process
– As mentioned earlier in the report, Sonances Ra 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. Sonances Ra 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.
Increasing silos among functional specialists
– The organizational structure of Sonances Ra is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Sonances Ra needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Sonances Ra to focus more on services rather than just following the product oriented approach.
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.
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.
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.
High cash cycle compare to competitors
Sonances Ra 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 harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Sonances Ra is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study RA?sonances (A): Selling Products or Dreams? can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
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.
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.
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.
Workers concerns about automation
– As automation is fast increasing in the segment, Sonances Ra 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.
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 -
Using analytics as competitive advantage
– Sonances Ra 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 RA?sonances (A): Selling Products or Dreams? - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Sonances Ra to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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.
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.
Loyalty marketing
– Sonances Ra 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.
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. Sonances Ra can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Developing new processes and practices
– Sonances Ra 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.
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.
Manufacturing automation
– Sonances Ra 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.
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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Sonances Ra can use these opportunities to build new business models that can help the communities that Sonances Ra operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
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.
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 -
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.
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Sonances Ra 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.
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 .
Stagnating economy with rate increase
– Sonances Ra 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.
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.
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.
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.
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.
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? .
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.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Sonances Ra with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.