Extending the "easy" Business Model: What Should easyGroup Do Next? SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Extending the "easy" Business Model: What Should easyGroup Do Next?
easyGroup is contemplating its entry into the cinema exhibition business in the UK through the launch of a no-frills cinema. The company believes that it can redeploy the capabilities, such as yield management, that led to the success of easyJet, its low cost airline business, into this new venture. The case examines the market for cinema in the UK, as well as the evolution of easyGroup's portfolio of companies, with a view to assessing the attractiveness of the company's planned launch of easyCinema.
Swot Analysis of "Extending the "easy" Business Model: What Should easyGroup Do Next?" written by Yves L. Doz, Anita Balchandani includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Cinema Easygroup facing as an external strategic factors. Some of the topics covered in Extending the "easy" Business Model: What Should easyGroup Do Next? case study are - Strategic Management Strategies, Growth strategy, Risk management and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Extending the "easy" Business Model: What Should easyGroup Do Next? casestudy better are - – increasing government debt because of Covid-19 spendings, geopolitical disruptions, increasing energy prices, central banks are concerned over increasing inflation, technology disruption, increasing household debt because of falling income levels, there is increasing trade war between United States & China,
increasing transportation and logistics costs, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
Introduction to SWOT Analysis of Extending the "easy" Business Model: What Should easyGroup Do Next?
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Extending the "easy" Business Model: What Should easyGroup Do Next? case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Cinema Easygroup, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Cinema Easygroup 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 Extending the "easy" Business Model: What Should easyGroup Do Next? can be done for the following purposes –
1. Strategic planning using facts provided in Extending the "easy" Business Model: What Should easyGroup Do Next? case study
2. Improving business portfolio management of Cinema Easygroup
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 Cinema Easygroup
Strengths Extending the "easy" Business Model: What Should easyGroup Do Next? | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Cinema Easygroup in Extending the "easy" Business Model: What Should easyGroup Do Next? Harvard Business Review case study are -
Training and development
– Cinema Easygroup has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Extending the "easy" Business Model: What Should easyGroup Do Next? 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.
Effective Research and Development (R&D)
– Cinema Easygroup 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 Extending the "easy" Business Model: What Should easyGroup Do Next? - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Cinema Easygroup digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Cinema Easygroup 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.
Superior customer experience
– The customer experience strategy of Cinema Easygroup in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Sustainable margins compare to other players in Strategy & Execution industry
– Extending the "easy" Business Model: What Should easyGroup Do Next? firm has clearly differentiated products in the market place. This has enabled Cinema Easygroup to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Cinema Easygroup to invest into research and development (R&D) and innovation.
Ability to recruit top talent
– Cinema Easygroup is one of the leading recruiters in the industry. Managers in the Extending the "easy" Business Model: What Should easyGroup Do Next? are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Low bargaining power of suppliers
– Suppliers of Cinema Easygroup in the sector have low bargaining power. Extending the "easy" Business Model: What Should easyGroup Do Next? has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Cinema Easygroup to manage not only supply disruptions but also source products at highly competitive prices.
Organizational Resilience of Cinema Easygroup
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Cinema Easygroup does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Analytics focus
– Cinema Easygroup 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 Yves L. Doz, Anita Balchandani 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.
High brand equity
– Cinema Easygroup has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Cinema Easygroup to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Successful track record of launching new products
– Cinema Easygroup has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Cinema Easygroup 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.
Learning organization
- Cinema Easygroup 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 Cinema Easygroup is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Extending the "easy" Business Model: What Should easyGroup Do Next? Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses Extending the "easy" Business Model: What Should easyGroup Do Next? | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Extending the "easy" Business Model: What Should easyGroup Do Next? are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Cinema Easygroup is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Extending the "easy" Business Model: What Should easyGroup Do Next? can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Capital Spending Reduction
– Even during the low interest decade, Cinema Easygroup 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 decision making process
– As mentioned earlier in the report, Cinema Easygroup 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. Cinema Easygroup 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Yves L. Doz, Anita Balchandani suggests that, Cinema Easygroup 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 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 Cinema Easygroup supply chain. Even after few cautionary changes mentioned in the HBR case study - Extending the "easy" Business Model: What Should easyGroup Do Next?, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Cinema Easygroup vulnerable to further global disruptions in South East Asia.
Skills based hiring
– The stress on hiring functional specialists at Cinema Easygroup 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Extending the "easy" Business Model: What Should easyGroup Do Next?, in the dynamic environment Cinema Easygroup has struggled to respond to the nimble upstart competition. Cinema Easygroup has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High operating costs
– Compare to the competitors, firm in the HBR case study Extending the "easy" Business Model: What Should easyGroup Do Next? 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 Cinema Easygroup 's lucrative customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Cinema Easygroup 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 cash cycle compare to competitors
Cinema Easygroup 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.
Interest costs
– Compare to the competition, Cinema Easygroup 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 Extending the "easy" Business Model: What Should easyGroup Do Next? | 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 Extending the "easy" Business Model: What Should easyGroup Do Next? are -
Leveraging digital technologies
– Cinema Easygroup 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.
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 Cinema Easygroup in the consumer business. Now Cinema Easygroup can target international markets with far fewer capital restrictions requirements than the existing system.
Manufacturing automation
– Cinema Easygroup 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.
Building a culture of innovation
– managers at Cinema Easygroup 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.
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. Cinema Easygroup 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. Cinema Easygroup 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Cinema Easygroup 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 Cinema Easygroup to hire the very best people irrespective of their geographical location.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Cinema Easygroup 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.
Loyalty marketing
– Cinema Easygroup 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.
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 Cinema Easygroup 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.
Using analytics as competitive advantage
– Cinema Easygroup 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 Extending the "easy" Business Model: What Should easyGroup Do Next? - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Cinema Easygroup to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Developing new processes and practices
– Cinema Easygroup 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Cinema Easygroup can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Extending the "easy" Business Model: What Should easyGroup Do Next?, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Creating value in data economy
– The success of analytics program of Cinema Easygroup has opened avenues for new revenue streams for the organization in the industry. This can help Cinema Easygroup to build a more holistic ecosystem as suggested in the Extending the "easy" Business Model: What Should easyGroup Do Next? case study. Cinema Easygroup can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats Extending the "easy" Business Model: What Should easyGroup Do Next? External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Extending the "easy" Business Model: What Should easyGroup Do Next? are -
High dependence on third party suppliers
– Cinema Easygroup 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Cinema Easygroup 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 Extending the "easy" Business Model: What Should easyGroup Do Next? .
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.
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.
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 Cinema Easygroup.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Cinema Easygroup 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.
Consumer confidence and its impact on Cinema Easygroup 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.
Increasing wage structure of Cinema Easygroup
– 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 Cinema Easygroup.
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 Cinema Easygroup in the Strategy & Execution sector and impact the bottomline of the organization.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Extending the "easy" Business Model: What Should easyGroup Do Next?, Cinema Easygroup 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 .
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 Cinema Easygroup business can come under increasing regulations regarding data privacy, data security, etc.
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. Cinema Easygroup can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Regulatory challenges
– Cinema Easygroup 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.
Weighted SWOT Analysis of Extending the "easy" Business Model: What Should easyGroup Do Next? 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 Extending the "easy" Business Model: What Should easyGroup Do Next? 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 Extending the "easy" Business Model: What Should easyGroup Do Next? 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 Extending the "easy" Business Model: What Should easyGroup Do Next? 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 Extending the "easy" Business Model: What Should easyGroup Do Next? 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 Cinema Easygroup needs to make to build a sustainable competitive advantage.
