iStockphoto.com: Turning Community into Commerce SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of iStockphoto.com: Turning Community into Commerce
When the founder of iStockphoto.com started the company in 2000, his objective was to share his vast collection of stock photography with graphic designers worldwide, and, in the process, help others do the same. By 2002, the organization was a respected and successful online community, but the founder and his partners now had to consider the profitability of their company. iStock was founded on community and collaboration - not commerce. Should the model change and if so, what would it take to make a significant culture change work? The case examines the culture and business opportunities for this start-up. It demonstrates the challenges of generating profit from an online community, as well as the key factors needed to build a community that can be turned into a profitable business.
Swot Analysis of "iStockphoto.com: Turning Community into Commerce" written by Rebecca A. Grant, Meghan Stothers includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Istockphoto.com Community facing as an external strategic factors. Some of the topics covered in iStockphoto.com: Turning Community into Commerce case study are - Strategic Management Strategies, Change management and Strategy & Execution.
Some of the macro environment factors that can be used to understand the iStockphoto.com: Turning Community into Commerce casestudy better are - – increasing transportation and logistics costs, cloud computing is disrupting traditional business models, central banks are concerned over increasing inflation, supply chains are disrupted by pandemic , increasing inequality as vast percentage of new income is going to the top 1%, increasing household debt because of falling income levels, technology disruption,
competitive advantages are harder to sustain because of technology dispersion, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of iStockphoto.com: Turning Community into Commerce
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in iStockphoto.com: Turning Community into Commerce case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Istockphoto.com Community, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Istockphoto.com Community 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 iStockphoto.com: Turning Community into Commerce can be done for the following purposes –
1. Strategic planning using facts provided in iStockphoto.com: Turning Community into Commerce case study
2. Improving business portfolio management of Istockphoto.com Community
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 Istockphoto.com Community
Strengths iStockphoto.com: Turning Community into Commerce | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Istockphoto.com Community in iStockphoto.com: Turning Community into Commerce Harvard Business Review case study are -
Operational resilience
– The operational resilience strategy in the iStockphoto.com: Turning Community into Commerce 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.
Successful track record of launching new products
– Istockphoto.com Community has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Istockphoto.com Community 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.
Cross disciplinary teams
– Horizontal connected teams at the Istockphoto.com Community 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.
Strong track record of project management
– Istockphoto.com Community is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Analytics focus
– Istockphoto.com Community 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 Rebecca A. Grant, Meghan Stothers 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.
Low bargaining power of suppliers
– Suppliers of Istockphoto.com Community in the sector have low bargaining power. iStockphoto.com: Turning Community into Commerce has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Istockphoto.com Community to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Istockphoto.com Community in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Organizational Resilience of Istockphoto.com Community
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Istockphoto.com Community does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Innovation driven organization
– Istockphoto.com Community is one of the most innovative firm in sector. Manager in iStockphoto.com: Turning Community into Commerce Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Diverse revenue streams
– Istockphoto.com Community is present in almost all the verticals within the industry. This has provided firm in iStockphoto.com: Turning Community into Commerce 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.
Effective Research and Development (R&D)
– Istockphoto.com Community 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 iStockphoto.com: Turning Community into Commerce - 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
– Istockphoto.com Community has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Istockphoto.com Community to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses iStockphoto.com: Turning Community into Commerce | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of iStockphoto.com: Turning Community into Commerce are -
Slow to strategic competitive environment developments
– As iStockphoto.com: Turning Community into Commerce HBR case study mentions - Istockphoto.com Community 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Istockphoto.com Community is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study iStockphoto.com: Turning Community into Commerce can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Low market penetration in new markets
– Outside its home market of Istockphoto.com Community, firm in the HBR case study iStockphoto.com: Turning Community into Commerce needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Capital Spending Reduction
– Even during the low interest decade, Istockphoto.com Community 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.
Need for greater diversity
– Istockphoto.com Community 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 iStockphoto.com: Turning Community into Commerce, 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, Istockphoto.com Community 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 bargaining power of channel partners
– Because of the regulatory requirements, Rebecca A. Grant, Meghan Stothers suggests that, Istockphoto.com Community 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 cash cycle compare to competitors
Istockphoto.com Community 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.
Aligning sales with marketing
– It come across in the case study iStockphoto.com: Turning Community into Commerce 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 iStockphoto.com: Turning Community into Commerce can leverage the sales team experience to cultivate customer relationships as Istockphoto.com Community is planning to shift buying processes online.
High operating costs
– Compare to the competitors, firm in the HBR case study iStockphoto.com: Turning Community into Commerce 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 Istockphoto.com Community 's lucrative customers.
Opportunities iStockphoto.com: Turning Community into Commerce | 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 iStockphoto.com: Turning Community into Commerce are -
Building a culture of innovation
– managers at Istockphoto.com Community 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.
Learning at scale
– Online learning technologies has now opened space for Istockphoto.com Community 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.
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 Istockphoto.com Community in the consumer business. Now Istockphoto.com Community can target international markets with far fewer capital restrictions requirements than the existing system.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Istockphoto.com Community 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 Istockphoto.com Community to hire the very best people irrespective of their geographical location.
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. Istockphoto.com Community can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Creating value in data economy
– The success of analytics program of Istockphoto.com Community has opened avenues for new revenue streams for the organization in the industry. This can help Istockphoto.com Community to build a more holistic ecosystem as suggested in the iStockphoto.com: Turning Community into Commerce case study. Istockphoto.com Community can build new products and services such as - data insight services, data privacy related products, data based consulting services, 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 Istockphoto.com Community 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 Istockphoto.com Community can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Istockphoto.com Community is facing challenges because of the dominance of functional experts in the organization. iStockphoto.com: Turning Community into Commerce 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.
Manufacturing automation
– Istockphoto.com Community 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.
Better consumer reach
– The expansion of the 5G network will help Istockphoto.com Community to increase its market reach. Istockphoto.com Community 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Istockphoto.com Community 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, iStockphoto.com: Turning Community into Commerce, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Using analytics as competitive advantage
– Istockphoto.com Community 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 iStockphoto.com: Turning Community into Commerce - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Istockphoto.com Community to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats iStockphoto.com: Turning Community into Commerce External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study iStockphoto.com: Turning Community into Commerce are -
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 Istockphoto.com Community.
High dependence on third party suppliers
– Istockphoto.com Community 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.
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 Istockphoto.com Community business can come under increasing regulations regarding data privacy, data security, etc.
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. Istockphoto.com Community needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
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.
Shortening product life cycle
– it is one of the major threat that Istockphoto.com Community is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Istockphoto.com Community with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Istockphoto.com Community in the Strategy & Execution sector and impact the bottomline of the organization.
Stagnating economy with rate increase
– Istockphoto.com Community 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.
Consumer confidence and its impact on Istockphoto.com Community 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. Istockphoto.com Community can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Istockphoto.com Community 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 iStockphoto.com: Turning Community into Commerce .
Technology acceleration in Forth Industrial Revolution
– Istockphoto.com Community has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Istockphoto.com Community 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.
Weighted SWOT Analysis of iStockphoto.com: Turning Community into Commerce 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 iStockphoto.com: Turning Community into Commerce 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 iStockphoto.com: Turning Community into Commerce 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 iStockphoto.com: Turning Community into Commerce 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 iStockphoto.com: Turning Community into Commerce 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 Istockphoto.com Community needs to make to build a sustainable competitive advantage.
