Case Study Description of Scientific-Atlanta, Inc.
Scientific-Atlantia (S-A), a leading manufacturer of cable TV equipment, is confronting strategic challenges in mid-2004. For decades, cable operators have faced high switching costs that have locked them into exclusive supply relationships with either S-A or its somewhat larger rival, Motorola. S-A has developed technology that substantially reduces switching costs, and it is positioned to capture market share because it has an 18-month lead over Motorola in developing cable set-top boxes that incorporate digital video recorders (DVRs). Cable operators are eager to offer DVRs to stem subscriber losses to satellite TV. The case asks whether S-A should aggressively pursue opportunities to overlay its set-tops in cable systems that previously employed only Motorola gear. If so, to what extent should S-A subsidize cable operators' remaining switching costs? Are there risks in introducing more competition into what had previously been a stable duopoly? Also explores S-A's strategic options for dealing with a transition to all-digital television technology and consumers' growing demand for solutions for managing their digital media files (photos, music, etc.). Asks whether S-A should continue to offer an integrated, proprietary, end-to-end transmission solution or, instead, embrace a more open "ecosystem," relying to a greater extent on third-party software and hardware providers and offering solution elements on an unbundled basis. A rewritten version of an earlier case.
Swot Analysis of "Scientific-Atlanta, Inc." written by Thomas R. Eisenmann includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Cable Motorola facing as an external strategic factors. Some of the topics covered in Scientific-Atlanta, Inc. case study are - Strategic Management Strategies, Financial markets, Internet, IT, Joint ventures, Mergers & acquisitions and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Scientific-Atlanta, Inc. casestudy better are - – increasing commodity prices, digital marketing is dominated by two big players Facebook and Google, increasing household debt because of falling income levels, increasing energy prices, talent flight as more people leaving formal jobs, increasing government debt because of Covid-19 spendings, geopolitical disruptions,
increasing inequality as vast percentage of new income is going to the top 1%, there is backlash against globalization, etc
Introduction to SWOT Analysis of Scientific-Atlanta, Inc.
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Scientific-Atlanta, Inc. case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Cable Motorola, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Cable Motorola 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 Scientific-Atlanta, Inc. can be done for the following purposes –
1. Strategic planning using facts provided in Scientific-Atlanta, Inc. case study
2. Improving business portfolio management of Cable Motorola
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 Cable Motorola
Strengths Scientific-Atlanta, Inc. | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Cable Motorola in Scientific-Atlanta, Inc. Harvard Business Review case study are -
Strong track record of project management
– Cable Motorola is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Successful track record of launching new products
– Cable Motorola has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Cable Motorola 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.
High switching costs
– The high switching costs that Cable Motorola 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.
Training and development
– Cable Motorola has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Scientific-Atlanta, Inc. 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.
Cross disciplinary teams
– Horizontal connected teams at the Cable Motorola 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.
Learning organization
- Cable Motorola 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 Cable Motorola is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Scientific-Atlanta, Inc. Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– Cable Motorola is one of the leading recruiters in the industry. Managers in the Scientific-Atlanta, Inc. 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 Scientific-Atlanta, Inc. 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.
Ability to lead change in Strategy & Execution field
– Cable Motorola 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 Cable Motorola in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Sustainable margins compare to other players in Strategy & Execution industry
– Scientific-Atlanta, Inc. firm has clearly differentiated products in the market place. This has enabled Cable Motorola to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Cable Motorola to invest into research and development (R&D) and innovation.
Analytics focus
– Cable Motorola 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 Thomas R. Eisenmann 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.
Superior customer experience
– The customer experience strategy of Cable Motorola in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses Scientific-Atlanta, Inc. | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Scientific-Atlanta, Inc. are -
No frontier risks strategy
– After analyzing the HBR case study Scientific-Atlanta, Inc., it seems that company is thinking about the frontier risks that can impact Strategy & Execution 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, Cable Motorola 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.
Need for greater diversity
– Cable Motorola 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.
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 Cable Motorola supply chain. Even after few cautionary changes mentioned in the HBR case study - Scientific-Atlanta, Inc., it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Cable Motorola vulnerable to further global disruptions in South East Asia.
High bargaining power of channel partners
– Because of the regulatory requirements, Thomas R. Eisenmann suggests that, Cable Motorola 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Scientific-Atlanta, Inc. 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 Cable Motorola has relatively successful track record of launching new products.
Increasing silos among functional specialists
– The organizational structure of Cable Motorola is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Cable Motorola needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Cable Motorola to focus more on services rather than just following the product oriented approach.
Lack of clear differentiation of Cable Motorola products
– To increase the profitability and margins on the products, Cable Motorola needs to provide more differentiated products than what it is currently offering in the marketplace.
Products dominated business model
– Even though Cable Motorola 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 - Scientific-Atlanta, Inc. should strive to include more intangible value offerings along with its core products and services.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Scientific-Atlanta, Inc., it seems that the employees of Cable Motorola 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.
Skills based hiring
– The stress on hiring functional specialists at Cable Motorola 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 Scientific-Atlanta, Inc. | 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 Scientific-Atlanta, Inc. are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Cable Motorola is facing challenges because of the dominance of functional experts in the organization. Scientific-Atlanta, Inc. 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Cable Motorola can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Learning at scale
– Online learning technologies has now opened space for Cable Motorola 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.
Better consumer reach
– The expansion of the 5G network will help Cable Motorola to increase its market reach. Cable Motorola 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Cable Motorola 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.
Buying journey improvements
– Cable Motorola can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Scientific-Atlanta, Inc. 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.
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 Cable Motorola 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Strategy & Execution industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Cable Motorola 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. Cable Motorola 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.
Developing new processes and practices
– Cable Motorola can develop new processes and procedures in Strategy & Execution 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.
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. Cable Motorola can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Cable Motorola 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 Cable Motorola to hire the very best people irrespective of their geographical location.
Building a culture of innovation
– managers at Cable Motorola can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Strategy & Execution segment.
Creating value in data economy
– The success of analytics program of Cable Motorola has opened avenues for new revenue streams for the organization in the industry. This can help Cable Motorola to build a more holistic ecosystem as suggested in the Scientific-Atlanta, Inc. case study. Cable Motorola can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats Scientific-Atlanta, Inc. External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Scientific-Atlanta, Inc. are -
Regulatory challenges
– Cable Motorola 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.
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 Cable Motorola in the Strategy & Execution sector and impact the bottomline of the organization.
Stagnating economy with rate increase
– Cable Motorola 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.
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 Cable Motorola.
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.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Scientific-Atlanta, Inc., Cable Motorola may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Strategy & Execution .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Cable Motorola with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Cable Motorola 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
– Cable Motorola 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. Cable Motorola can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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. Cable Motorola needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Increasing wage structure of Cable Motorola
– 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 Cable Motorola.
Consumer confidence and its impact on Cable Motorola 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.
Weighted SWOT Analysis of Scientific-Atlanta, Inc. 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 Scientific-Atlanta, Inc. 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 Scientific-Atlanta, Inc. 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 Scientific-Atlanta, Inc. 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 Scientific-Atlanta, Inc. 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 Cable Motorola needs to make to build a sustainable competitive advantage.