CJ E&M: Creating a K-Culture in the U.S. SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of CJ E&M: Creating a K-Culture in the U.S.
Buoyed by the success of K-pop music and K-drama television shows in Asian countries, Jay Lee, Chairman of the South Korean conglomerate CJ Group, believed that the time was ripe for taking Korean cultural content to the West. One initiative, carried out by the Group's Entertainment & Media (E&M) division, was a daylong fan convention, called 'KCON' , that was held in Irvine CA in October 2012 and which featured various Korean cultural elements, such as music, dance, film, and food. In the spring of 2013, Miky Lee, the Group's Vice Chairman, called a meeting with key executives to review the results of KCON 2012's and make a recommendation to the Chairman on whether to hold a similar event in 2013. As part of their deliberations, the executives were expected to consider where a potential 2013 convention should be held, which artists to invite, which target consumers to focus on, how to price tickets and how to attract more sponsors. With KCON 2012 having lost money, despite a robust turnout, it was far from clear whether to repeat the event and, if so, whether its scale should be expanded beyond 2012's $1.1 million budget. With CJ recently opening a chain of mid-market Korean food restaurants in the Los Angeles area called Bibigo, the meeting would also touch on the restaurant's U.S. growth plans and how they might be connected to KCON. More broadly, the executives had to wrestle with the question of whether Americans would ever really embrace Hallyu, the Korean Wave, beyond one-off success stories like PSY's "Gangnam Style". And even if they believed so, was KCON the right vehicle to make it happen, or was the event just a waste of the company's time and money? CJ Group's Vice Chairman, Miky Lee, and other CJ executives need to review the results of KCON 2012, the company's first Korean pop-culture convention, and make a recommendation to the Chairman on whether to hold a similar event in 2013. The executives were expected to consider where a potential 2013 convention should be held, which artists to invite, which target consumers to focus on, how to price tickets and how to attract more sponsors. With KCON 2012 having lost money, it was unclear whether to repeat the event and, if so, what budget to allocate.
Authors :: Elie Ofek, Sang-Hoon Kim, Michael Norris
Swot Analysis of "CJ E&M: Creating a K-Culture in the U.S." written by Elie Ofek, Sang-Hoon Kim, Michael Norris includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Kcon Cj facing as an external strategic factors. Some of the topics covered in CJ E&M: Creating a K-Culture in the U.S. case study are - Strategic Management Strategies, Economy, Marketing, Strategy and Sales & Marketing.
Some of the macro environment factors that can be used to understand the CJ E&M: Creating a K-Culture in the U.S. casestudy better are - – technology disruption, cloud computing is disrupting traditional business models, competitive advantages are harder to sustain because of technology dispersion, supply chains are disrupted by pandemic , talent flight as more people leaving formal jobs, there is increasing trade war between United States & China, increasing inequality as vast percentage of new income is going to the top 1%,
central banks are concerned over increasing inflation, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of CJ E&M: Creating a K-Culture in the U.S.
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in CJ E&M: Creating a K-Culture in the U.S. case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Kcon Cj, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Kcon Cj 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 CJ E&M: Creating a K-Culture in the U.S. can be done for the following purposes –
1. Strategic planning using facts provided in CJ E&M: Creating a K-Culture in the U.S. case study
2. Improving business portfolio management of Kcon Cj
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 Kcon Cj
Strengths CJ E&M: Creating a K-Culture in the U.S. | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Kcon Cj in CJ E&M: Creating a K-Culture in the U.S. Harvard Business Review case study are -
Successful track record of launching new products
– Kcon Cj has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Kcon Cj 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.
Effective Research and Development (R&D)
– Kcon Cj 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 CJ E&M: Creating a K-Culture in the U.S. - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Innovation driven organization
– Kcon Cj is one of the most innovative firm in sector. Manager in CJ E&M: Creating a K-Culture in the U.S. Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Organizational Resilience of Kcon Cj
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Kcon Cj does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Learning organization
- Kcon Cj 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 Kcon Cj is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in CJ E&M: Creating a K-Culture in the U.S. Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Highly skilled collaborators
– Kcon Cj 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 CJ E&M: Creating a K-Culture in the U.S. HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to recruit top talent
– Kcon Cj is one of the leading recruiters in the industry. Managers in the CJ E&M: Creating a K-Culture in the U.S. are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Operational resilience
– The operational resilience strategy in the CJ E&M: Creating a K-Culture in the U.S. 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.
High brand equity
– Kcon Cj has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Kcon Cj 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
– CJ E&M: Creating a K-Culture in the U.S. firm has clearly differentiated products in the market place. This has enabled Kcon Cj to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Kcon Cj to invest into research and development (R&D) and innovation.
Training and development
– Kcon Cj has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in CJ E&M: Creating a K-Culture in the U.S. 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.
High switching costs
– The high switching costs that Kcon Cj 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.
Weaknesses CJ E&M: Creating a K-Culture in the U.S. | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of CJ E&M: Creating a K-Culture in the U.S. are -
No frontier risks strategy
– After analyzing the HBR case study CJ E&M: Creating a K-Culture in the U.S., it seems that company is thinking about the frontier risks that can impact Sales & Marketing strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Kcon Cj supply chain. Even after few cautionary changes mentioned in the HBR case study - CJ E&M: Creating a K-Culture in the U.S., it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Kcon Cj vulnerable to further global disruptions in South East Asia.
Slow to strategic competitive environment developments
– As CJ E&M: Creating a K-Culture in the U.S. HBR case study mentions - Kcon Cj 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.
Need for greater diversity
– Kcon Cj 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study CJ E&M: Creating a K-Culture in the U.S., in the dynamic environment Kcon Cj has struggled to respond to the nimble upstart competition. Kcon Cj has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High cash cycle compare to competitors
Kcon Cj 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Kcon Cj 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.
High operating costs
– Compare to the competitors, firm in the HBR case study CJ E&M: Creating a K-Culture in the U.S. 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 Kcon Cj 's lucrative customers.
Aligning sales with marketing
– It come across in the case study CJ E&M: Creating a K-Culture in the U.S. 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 CJ E&M: Creating a K-Culture in the U.S. can leverage the sales team experience to cultivate customer relationships as Kcon Cj is planning to shift buying processes online.
Increasing silos among functional specialists
– The organizational structure of Kcon Cj is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Kcon Cj needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Kcon Cj to focus more on services rather than just following the product oriented approach.
Interest costs
– Compare to the competition, Kcon Cj 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.
Opportunities CJ E&M: Creating a K-Culture in the U.S. | 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 CJ E&M: Creating a K-Culture in the U.S. are -
Using analytics as competitive advantage
– Kcon Cj 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 CJ E&M: Creating a K-Culture in the U.S. - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Kcon Cj 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, Kcon Cj is facing challenges because of the dominance of functional experts in the organization. CJ E&M: Creating a K-Culture in the U.S. 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.
Creating value in data economy
– The success of analytics program of Kcon Cj has opened avenues for new revenue streams for the organization in the industry. This can help Kcon Cj to build a more holistic ecosystem as suggested in the CJ E&M: Creating a K-Culture in the U.S. case study. Kcon Cj can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
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. Kcon Cj can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Developing new processes and practices
– Kcon Cj 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.
Better consumer reach
– The expansion of the 5G network will help Kcon Cj to increase its market reach. Kcon Cj 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.
Manufacturing automation
– Kcon Cj 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.
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 Kcon Cj 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Kcon Cj 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.
Learning at scale
– Online learning technologies has now opened space for Kcon Cj 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.
Buying journey improvements
– Kcon Cj can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. CJ E&M: Creating a K-Culture in the U.S. 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Kcon Cj 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Kcon Cj can use these opportunities to build new business models that can help the communities that Kcon Cj operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Threats CJ E&M: Creating a K-Culture in the U.S. External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study CJ E&M: Creating a K-Culture in the U.S. are -
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. Kcon Cj needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Consumer confidence and its impact on Kcon Cj 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
– Kcon Cj has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Kcon Cj 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.
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. Kcon Cj will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Kcon Cj 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.
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. Kcon Cj can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Environmental challenges
– Kcon Cj 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. Kcon Cj can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study CJ E&M: Creating a K-Culture in the U.S., Kcon Cj 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 .
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 Kcon Cj in the Sales & Marketing sector and impact the bottomline of the organization.
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 Kcon Cj business can come under increasing regulations regarding data privacy, data security, etc.
Shortening product life cycle
– it is one of the major threat that Kcon Cj is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Kcon Cj with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Regulatory challenges
– Kcon Cj 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.
Weighted SWOT Analysis of CJ E&M: Creating a K-Culture in the U.S. 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 CJ E&M: Creating a K-Culture in the U.S. 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 CJ E&M: Creating a K-Culture in the U.S. 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 CJ E&M: Creating a K-Culture in the U.S. 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 CJ E&M: Creating a K-Culture in the U.S. 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 Kcon Cj needs to make to build a sustainable competitive advantage.
