Luminar: Leveraging Big Data Using Corporate Entrepreneurship SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Luminar: Leveraging Big Data Using Corporate Entrepreneurship
Entravision, a leading Spanish-language broadcasting company in the United States that targets Hispanic Americans, has just set up a digital analytics division called Luminar, which uses Big Data to focus a company's marketing to a particular set of consumers. The idea of launching Luminar has been mooted by an outsider who is a friend and protegA? of the company's founding chairman. As the incumbent president of the new division, he is grappling with some major issues. How should he secure the buy-in of line and staff managers at Entravision? How should he find a structural fit between Entravision and Luminar? How should he leverage business opportunities beyond digital analytics? What kind of entry barriers can he build so that Luminar retains its first mover advantage?
Authors :: Simon Parker, Chandra Sekhar Ramasastry
Swot Analysis of "Luminar: Leveraging Big Data Using Corporate Entrepreneurship" written by Simon Parker, Chandra Sekhar Ramasastry includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Luminar Entravision facing as an external strategic factors. Some of the topics covered in Luminar: Leveraging Big Data Using Corporate Entrepreneurship case study are - Strategic Management Strategies, Entrepreneurship, Strategy and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Luminar: Leveraging Big Data Using Corporate Entrepreneurship casestudy better are - – geopolitical disruptions, there is backlash against globalization, digital marketing is dominated by two big players Facebook and Google, wage bills are increasing, technology disruption, increasing transportation and logistics costs, banking and financial system is disrupted by Bitcoin and other crypto currencies,
supply chains are disrupted by pandemic , customer relationship management is fast transforming because of increasing concerns over data privacy, etc
Introduction to SWOT Analysis of Luminar: Leveraging Big Data Using Corporate Entrepreneurship
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Luminar: Leveraging Big Data Using Corporate Entrepreneurship case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Luminar Entravision, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Luminar Entravision 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 Luminar: Leveraging Big Data Using Corporate Entrepreneurship can be done for the following purposes –
1. Strategic planning using facts provided in Luminar: Leveraging Big Data Using Corporate Entrepreneurship case study
2. Improving business portfolio management of Luminar Entravision
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Luminar Entravision
Strengths Luminar: Leveraging Big Data Using Corporate Entrepreneurship | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Luminar Entravision in Luminar: Leveraging Big Data Using Corporate Entrepreneurship Harvard Business Review case study are -
Strong track record of project management
– Luminar Entravision is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Highly skilled collaborators
– Luminar Entravision 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 Luminar: Leveraging Big Data Using Corporate Entrepreneurship HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Analytics focus
– Luminar Entravision 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 Simon Parker, Chandra Sekhar Ramasastry 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)
– Luminar Entravision 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 Luminar: Leveraging Big Data Using Corporate Entrepreneurship - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High brand equity
– Luminar Entravision has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Luminar Entravision to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Cross disciplinary teams
– Horizontal connected teams at the Luminar Entravision 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.
Training and development
– Luminar Entravision has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Luminar: Leveraging Big Data Using Corporate Entrepreneurship 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.
Low bargaining power of suppliers
– Suppliers of Luminar Entravision in the sector have low bargaining power. Luminar: Leveraging Big Data Using Corporate Entrepreneurship has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Luminar Entravision to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Luminar Entravision in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Luminar Entravision digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Luminar Entravision 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.
Ability to lead change in Strategy & Execution field
– Luminar Entravision is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Luminar Entravision in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Diverse revenue streams
– Luminar Entravision is present in almost all the verticals within the industry. This has provided firm in Luminar: Leveraging Big Data Using Corporate Entrepreneurship 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.
Weaknesses Luminar: Leveraging Big Data Using Corporate Entrepreneurship | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Luminar: Leveraging Big Data Using Corporate Entrepreneurship are -
Need for greater diversity
– Luminar Entravision 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.
Aligning sales with marketing
– It come across in the case study Luminar: Leveraging Big Data Using Corporate Entrepreneurship 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 Luminar: Leveraging Big Data Using Corporate Entrepreneurship can leverage the sales team experience to cultivate customer relationships as Luminar Entravision is planning to shift buying processes online.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Luminar: Leveraging Big Data Using Corporate Entrepreneurship, is just above the industry average. Luminar Entravision 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Luminar: Leveraging Big Data Using Corporate Entrepreneurship, in the dynamic environment Luminar Entravision has struggled to respond to the nimble upstart competition. Luminar Entravision has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Products dominated business model
– Even though Luminar Entravision 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 - Luminar: Leveraging Big Data Using Corporate Entrepreneurship should strive to include more intangible value offerings along with its core products and services.
Slow decision making process
– As mentioned earlier in the report, Luminar Entravision 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. Luminar Entravision 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.
Low market penetration in new markets
– Outside its home market of Luminar Entravision, firm in the HBR case study Luminar: Leveraging Big Data Using Corporate Entrepreneurship needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High operating costs
– Compare to the competitors, firm in the HBR case study Luminar: Leveraging Big Data Using Corporate Entrepreneurship 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 Luminar Entravision 's lucrative customers.
Capital Spending Reduction
– Even during the low interest decade, Luminar Entravision 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.
Lack of clear differentiation of Luminar Entravision products
– To increase the profitability and margins on the products, Luminar Entravision needs to provide more differentiated products than what it is currently offering in the marketplace.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Luminar: Leveraging Big Data Using Corporate Entrepreneurship, it seems that the employees of Luminar Entravision 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.
Opportunities Luminar: Leveraging Big Data Using Corporate Entrepreneurship | 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 Luminar: Leveraging Big Data Using Corporate Entrepreneurship are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Luminar Entravision in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Strategy & Execution segment, and it will provide faster access to the consumers.
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 Luminar Entravision 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Luminar Entravision can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Better consumer reach
– The expansion of the 5G network will help Luminar Entravision to increase its market reach. Luminar Entravision 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Luminar Entravision is facing challenges because of the dominance of functional experts in the organization. Luminar: Leveraging Big Data Using Corporate Entrepreneurship 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.
Learning at scale
– Online learning technologies has now opened space for Luminar Entravision 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.
Loyalty marketing
– Luminar Entravision 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.
Buying journey improvements
– Luminar Entravision can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Luminar: Leveraging Big Data Using Corporate Entrepreneurship 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.
Manufacturing automation
– Luminar Entravision can use the latest technology developments to improve its manufacturing and designing process in Strategy & Execution 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.
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 Luminar Entravision in the consumer business. Now Luminar Entravision can target international markets with far fewer capital restrictions requirements than the existing system.
Leveraging digital technologies
– Luminar Entravision 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.
Using analytics as competitive advantage
– Luminar Entravision 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 Luminar: Leveraging Big Data Using Corporate Entrepreneurship - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Luminar Entravision to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Strategy & Execution industry, but it has also influenced the consumer preferences. Luminar Entravision can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats Luminar: Leveraging Big Data Using Corporate Entrepreneurship External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Luminar: Leveraging Big Data Using Corporate Entrepreneurship are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Luminar Entravision in the Strategy & Execution industry. The Strategy & Execution 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.
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. Luminar Entravision 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Luminar Entravision with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing wage structure of Luminar Entravision
– 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 Luminar Entravision.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Consumer confidence and its impact on Luminar Entravision 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.
Easy access to finance
– Easy access to finance in Strategy & Execution field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Luminar Entravision can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Luminar Entravision in the Strategy & Execution sector and impact the bottomline of the organization.
Shortening product life cycle
– it is one of the major threat that Luminar Entravision is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Stagnating economy with rate increase
– Luminar Entravision 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
– Luminar Entravision 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 Strategy & Execution industry regulations.
Technology acceleration in Forth Industrial Revolution
– Luminar Entravision has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Luminar Entravision needs to keep up with the evolution of technology in the Strategy & Execution sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
High 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. Luminar Entravision needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Weighted SWOT Analysis of Luminar: Leveraging Big Data Using Corporate Entrepreneurship 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 Luminar: Leveraging Big Data Using Corporate Entrepreneurship 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 Luminar: Leveraging Big Data Using Corporate Entrepreneurship 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 Luminar: Leveraging Big Data Using Corporate Entrepreneurship 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 Luminar: Leveraging Big Data Using Corporate Entrepreneurship 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 Luminar Entravision needs to make to build a sustainable competitive advantage.