Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese Version SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese Version
Supplements the (A) case.On June 17, 2007, Real Madrid sealed its first Spanish league championship under new president Ramon Calderon, ending an unprecedented title drought. Real Madrid had seen a significant growth in revenues and now was the world's biggest soccer club and among the largest and most profitable sports franchises globally. Although Calderon signed several new stars in his first year, he also rejuvenated the team by acquiring the promising youngsters, thereby moving away from what had been dubbed the "Galacticos Strategy" introduced by former president Florentino Perez. Would the move away form this strategy bring continued successes on the field? And how would it impact real Madrid's business performance?
Swot Analysis of "Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese Version" written by Anita Elberse, John A. Quelch includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Madrid Galacticos facing as an external strategic factors. Some of the topics covered in Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese Version case study are - Strategic Management Strategies, Globalization and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese Version casestudy better are - – increasing transportation and logistics costs, increasing government debt because of Covid-19 spendings, there is increasing trade war between United States & China, banking and financial system is disrupted by Bitcoin and other crypto currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, supply chains are disrupted by pandemic , digital marketing is dominated by two big players Facebook and Google,
cloud computing is disrupting traditional business models, talent flight as more people leaving formal jobs, etc
Introduction to SWOT Analysis of Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese Version
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese Version case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Madrid Galacticos, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Madrid Galacticos 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 Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese Version can be done for the following purposes –
1. Strategic planning using facts provided in Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese Version case study
2. Improving business portfolio management of Madrid Galacticos
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 Madrid Galacticos
Strengths Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese Version | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Madrid Galacticos in Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese Version Harvard Business Review case study are -
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Madrid Galacticos digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Madrid Galacticos 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.
Analytics focus
– Madrid Galacticos 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 Anita Elberse, John A. Quelch 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.
Effective Research and Development (R&D)
– Madrid Galacticos 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 Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese 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.
Successful track record of launching new products
– Madrid Galacticos has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Madrid Galacticos 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.
Strong track record of project management
– Madrid Galacticos is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Training and development
– Madrid Galacticos has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese 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.
Operational resilience
– The operational resilience strategy in the Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese 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.
Innovation driven organization
– Madrid Galacticos is one of the most innovative firm in sector. Manager in Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese Version Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Cross disciplinary teams
– Horizontal connected teams at the Madrid Galacticos 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.
Ability to recruit top talent
– Madrid Galacticos is one of the leading recruiters in the industry. Managers in the Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese Version are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Organizational Resilience of Madrid Galacticos
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Madrid Galacticos does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Superior customer experience
– The customer experience strategy of Madrid Galacticos in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese Version | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese Version are -
Capital Spending Reduction
– Even during the low interest decade, Madrid Galacticos 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 bargaining power of channel partners
– Because of the regulatory requirements, Anita Elberse, John A. Quelch suggests that, Madrid Galacticos 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.
Increasing silos among functional specialists
– The organizational structure of Madrid Galacticos is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Madrid Galacticos needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Madrid Galacticos to focus more on services rather than just following the product oriented approach.
Slow decision making process
– As mentioned earlier in the report, Madrid Galacticos 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. Madrid Galacticos 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Madrid Galacticos 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese Version, it seems that the employees of Madrid Galacticos 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese Version, in the dynamic environment Madrid Galacticos has struggled to respond to the nimble upstart competition. Madrid Galacticos 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 Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese Version 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 Madrid Galacticos has relatively successful track record of launching new products.
Slow to strategic competitive environment developments
– As Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese Version HBR case study mentions - Madrid Galacticos 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 operating costs
– Compare to the competitors, firm in the HBR case study Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese 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 Madrid Galacticos 's lucrative customers.
Skills based hiring
– The stress on hiring functional specialists at Madrid Galacticos 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.
Opportunities Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese 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 Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese Version are -
Developing new processes and practices
– Madrid Galacticos 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Madrid Galacticos can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Using analytics as competitive advantage
– Madrid Galacticos 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 Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese Version - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Madrid Galacticos 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, Madrid Galacticos is facing challenges because of the dominance of functional experts in the organization. Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese 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.
Loyalty marketing
– Madrid Galacticos 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Madrid Galacticos 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Madrid Galacticos 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 Madrid Galacticos to hire the very best people irrespective of their geographical location.
Better consumer reach
– The expansion of the 5G network will help Madrid Galacticos to increase its market reach. Madrid Galacticos 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. Madrid Galacticos can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Madrid Galacticos 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, Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Madrid Galacticos can use these opportunities to build new business models that can help the communities that Madrid Galacticos operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Learning at scale
– Online learning technologies has now opened space for Madrid Galacticos 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.
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. Madrid Galacticos can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese Version External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese Version 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 Madrid Galacticos.
High dependence on third party suppliers
– Madrid Galacticos 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.
Regulatory challenges
– Madrid Galacticos 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.
Consumer confidence and its impact on Madrid Galacticos 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.
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. Madrid Galacticos 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, Madrid Galacticos 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 Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese Version .
Technology acceleration in Forth Industrial Revolution
– Madrid Galacticos has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Madrid Galacticos 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.
Increasing wage structure of Madrid Galacticos
– 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 Madrid Galacticos.
Stagnating economy with rate increase
– Madrid Galacticos 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese Version, Madrid Galacticos 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 .
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. Madrid Galacticos 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 Madrid Galacticos 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.
Environmental challenges
– Madrid Galacticos 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. Madrid Galacticos can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Weighted SWOT Analysis of Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese 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 Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese 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 Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese 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 Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese 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 Real Madrid Club de Futbol in 2007: Beyond the Galacticos, Chinese 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 Madrid Galacticos needs to make to build a sustainable competitive advantage.
