Daktronics (B): The Large Sports Venue Sales Channel SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Daktronics (B): The Large Sports Venue Sales Channel
Daktronics Corporation made score boards and large displays for sports venues. The company had been the "Cadillac" of the industry and commanded nearly 70 percent share of the college and professional sports venue market for large displays. Recently, however, increasingly complex, technological installations and maturing manufacturing processes and sourcing had enabled new players to enter the market. Further, buyers in the large sports venue market had been including consulting firms in the decision process. Where Daktronics had often been the unchallenged choice, they were now being challenged by greater competition and channel influences that threatened both share of market and gross margins. Jay Parker, Daktronics Sales Manager for Large Sports Venues, was trying to understand the new market realities and devise an approach that would maintain Daktronics' market leadership and profits.
Swot Analysis of "Daktronics (B): The Large Sports Venue Sales Channel" written by David W. Rosenthal includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Daktronics Sports facing as an external strategic factors. Some of the topics covered in Daktronics (B): The Large Sports Venue Sales Channel case study are - Strategic Management Strategies, and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Daktronics (B): The Large Sports Venue Sales Channel casestudy better are - – increasing commodity prices, customer relationship management is fast transforming because of increasing concerns over data privacy, technology disruption, increasing transportation and logistics costs, talent flight as more people leaving formal jobs, banking and financial system is disrupted by Bitcoin and other crypto currencies, digital marketing is dominated by two big players Facebook and Google,
competitive advantages are harder to sustain because of technology dispersion, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of Daktronics (B): The Large Sports Venue Sales Channel
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Daktronics (B): The Large Sports Venue Sales Channel case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Daktronics Sports, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Daktronics Sports 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 Daktronics (B): The Large Sports Venue Sales Channel can be done for the following purposes –
1. Strategic planning using facts provided in Daktronics (B): The Large Sports Venue Sales Channel case study
2. Improving business portfolio management of Daktronics Sports
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 Daktronics Sports
Strengths Daktronics (B): The Large Sports Venue Sales Channel | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Daktronics Sports in Daktronics (B): The Large Sports Venue Sales Channel Harvard Business Review case study are -
Superior customer experience
– The customer experience strategy of Daktronics Sports in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Effective Research and Development (R&D)
– Daktronics Sports 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 Daktronics (B): The Large Sports Venue Sales Channel - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Sustainable margins compare to other players in Sales & Marketing industry
– Daktronics (B): The Large Sports Venue Sales Channel firm has clearly differentiated products in the market place. This has enabled Daktronics Sports to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Daktronics Sports to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Daktronics Sports 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.
Successful track record of launching new products
– Daktronics Sports has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Daktronics Sports 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.
Organizational Resilience of Daktronics Sports
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Daktronics Sports does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– Daktronics Sports has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Daktronics (B): The Large Sports Venue Sales Channel 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
- Daktronics Sports 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 Daktronics Sports is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Daktronics (B): The Large Sports Venue Sales Channel Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
High switching costs
– The high switching costs that Daktronics Sports 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.
Highly skilled collaborators
– Daktronics Sports 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 Daktronics (B): The Large Sports Venue Sales Channel HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Daktronics Sports digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Daktronics Sports 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.
Innovation driven organization
– Daktronics Sports is one of the most innovative firm in sector. Manager in Daktronics (B): The Large Sports Venue Sales Channel Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Weaknesses Daktronics (B): The Large Sports Venue Sales Channel | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Daktronics (B): The Large Sports Venue Sales Channel are -
High cash cycle compare to competitors
Daktronics Sports 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 strategic competitive environment developments
– As Daktronics (B): The Large Sports Venue Sales Channel HBR case study mentions - Daktronics Sports 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.
Low market penetration in new markets
– Outside its home market of Daktronics Sports, firm in the HBR case study Daktronics (B): The Large Sports Venue Sales Channel needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Need for greater diversity
– Daktronics Sports has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
No frontier risks strategy
– After analyzing the HBR case study Daktronics (B): The Large Sports Venue Sales Channel, it seems that company is thinking about the frontier risks that can impact Sales & Marketing strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Interest costs
– Compare to the competition, Daktronics Sports has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
High 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 Daktronics Sports supply chain. Even after few cautionary changes mentioned in the HBR case study - Daktronics (B): The Large Sports Venue Sales Channel, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Daktronics Sports vulnerable to further global disruptions in South East Asia.
Slow decision making process
– As mentioned earlier in the report, Daktronics Sports 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. Daktronics Sports 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.
Capital Spending Reduction
– Even during the low interest decade, Daktronics Sports 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Daktronics Sports is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Daktronics (B): The Large Sports Venue Sales Channel can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Daktronics Sports 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 Daktronics (B): The Large Sports Venue Sales Channel | 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 Daktronics (B): The Large Sports Venue Sales Channel are -
Better consumer reach
– The expansion of the 5G network will help Daktronics Sports to increase its market reach. Daktronics Sports 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.
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. Daktronics Sports can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Learning at scale
– Online learning technologies has now opened space for Daktronics Sports 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Daktronics Sports can use these opportunities to build new business models that can help the communities that Daktronics Sports operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Creating value in data economy
– The success of analytics program of Daktronics Sports has opened avenues for new revenue streams for the organization in the industry. This can help Daktronics Sports to build a more holistic ecosystem as suggested in the Daktronics (B): The Large Sports Venue Sales Channel case study. Daktronics Sports can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Daktronics Sports can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Daktronics (B): The Large Sports Venue Sales Channel 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.
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 Daktronics Sports in the consumer business. Now Daktronics Sports can target international markets with far fewer capital restrictions requirements than the existing system.
Using analytics as competitive advantage
– Daktronics Sports 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 Daktronics (B): The Large Sports Venue Sales Channel - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Daktronics Sports 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, Daktronics Sports is facing challenges because of the dominance of functional experts in the organization. Daktronics (B): The Large Sports Venue Sales Channel 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Daktronics Sports 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 Daktronics Sports to hire the very best people irrespective of their geographical location.
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. Daktronics Sports can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Leveraging digital technologies
– Daktronics Sports 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Sales & Marketing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Daktronics Sports can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Daktronics Sports can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Threats Daktronics (B): The Large Sports Venue Sales Channel External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Daktronics (B): The Large Sports Venue Sales Channel are -
Stagnating economy with rate increase
– Daktronics Sports 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.
Regulatory challenges
– Daktronics Sports 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.
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.
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. Daktronics Sports can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Technology acceleration in Forth Industrial Revolution
– Daktronics Sports has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Daktronics Sports 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 international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Daktronics Sports 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 Daktronics (B): The Large Sports Venue Sales Channel .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Daktronics Sports 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.
Shortening product life cycle
– it is one of the major threat that Daktronics Sports 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 Daktronics Sports 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Daktronics (B): The Large Sports Venue Sales Channel, Daktronics Sports 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 .
Environmental challenges
– Daktronics Sports 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. Daktronics Sports can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
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 Daktronics Sports in the Sales & Marketing sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Daktronics Sports 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.
Weighted SWOT Analysis of Daktronics (B): The Large Sports Venue Sales Channel 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 Daktronics (B): The Large Sports Venue Sales Channel 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 Daktronics (B): The Large Sports Venue Sales Channel 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 Daktronics (B): The Large Sports Venue Sales Channel 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 Daktronics (B): The Large Sports Venue Sales Channel 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 Daktronics Sports needs to make to build a sustainable competitive advantage.