MessageTech, Inc. provides digital media technology and solutions that help clients customize advertising to their specific needs. The company's proprietary technology has the potential to revolutionize the way large, geographically dispersed retailers approach advertising and promotion by allowing clients the flexibility to customize advertising content, in real time, to suit the conditions of each individual site. Results of beta testing indicate that clients' sales increase significantly after installation of the messageTech system. Yet, the company has been unable to close on any major sales of the system. The newly appointed CEO has a mandate to commercialize the new technology. He must develop a strategy that balances the company's needs for short-term performance against the actions that will ensure a viable competitive position over the long-term.
Swot Analysis of "MessageTech, Inc." written by Charlene Nicholls-Nixon, Ellen Jarmain includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Messagetech Customize facing as an external strategic factors. Some of the topics covered in MessageTech, Inc. case study are - Strategic Management Strategies, Marketing, Strategy, Technology and Strategy & Execution.
Some of the macro environment factors that can be used to understand the MessageTech, Inc. casestudy better are - – technology disruption, central banks are concerned over increasing inflation, increasing energy prices, increasing government debt because of Covid-19 spendings, supply chains are disrupted by pandemic , there is backlash against globalization, banking and financial system is disrupted by Bitcoin and other crypto currencies,
increasing transportation and logistics costs, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of MessageTech, Inc.
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in MessageTech, Inc. case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Messagetech Customize, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Messagetech Customize 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 MessageTech, Inc. can be done for the following purposes –
1. Strategic planning using facts provided in MessageTech, Inc. case study
2. Improving business portfolio management of Messagetech Customize
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 Messagetech Customize
Strengths MessageTech, Inc. | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Messagetech Customize in MessageTech, Inc. Harvard Business Review case study are -
Training and development
– Messagetech Customize has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in MessageTech, 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.
Sustainable margins compare to other players in Strategy & Execution industry
– MessageTech, Inc. firm has clearly differentiated products in the market place. This has enabled Messagetech Customize to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Messagetech Customize to invest into research and development (R&D) and innovation.
Learning organization
- Messagetech Customize 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 Messagetech Customize is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in MessageTech, Inc. Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Successful track record of launching new products
– Messagetech Customize has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Messagetech Customize 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.
Ability to recruit top talent
– Messagetech Customize is one of the leading recruiters in the industry. Managers in the MessageTech, 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.
High brand equity
– Messagetech Customize has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Messagetech Customize to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of Messagetech Customize in the sector have low bargaining power. MessageTech, Inc. has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Messagetech Customize to manage not only supply disruptions but also source products at highly competitive prices.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Messagetech Customize digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Messagetech Customize 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.
High switching costs
– The high switching costs that Messagetech Customize 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.
Effective Research and Development (R&D)
– Messagetech Customize 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 MessageTech, Inc. - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Diverse revenue streams
– Messagetech Customize is present in almost all the verticals within the industry. This has provided firm in MessageTech, Inc. 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.
Analytics focus
– Messagetech Customize 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 Charlene Nicholls-Nixon, Ellen Jarmain 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.
Weaknesses MessageTech, Inc. | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of MessageTech, Inc. are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the MessageTech, 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 Messagetech Customize has relatively successful track record of launching new products.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Messagetech Customize is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study MessageTech, Inc. can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Increasing silos among functional specialists
– The organizational structure of Messagetech Customize is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Messagetech Customize needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Messagetech Customize to focus more on services rather than just following the product oriented approach.
Need for greater diversity
– Messagetech Customize 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study MessageTech, Inc., in the dynamic environment Messagetech Customize has struggled to respond to the nimble upstart competition. Messagetech Customize has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
No frontier risks strategy
– After analyzing the HBR case study MessageTech, 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, Messagetech Customize 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.
Skills based hiring
– The stress on hiring functional specialists at Messagetech Customize 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.
High operating costs
– Compare to the competitors, firm in the HBR case study MessageTech, Inc. 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 Messagetech Customize 's lucrative customers.
Low market penetration in new markets
– Outside its home market of Messagetech Customize, firm in the HBR case study MessageTech, Inc. needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Capital Spending Reduction
– Even during the low interest decade, Messagetech Customize 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.
Opportunities MessageTech, 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 MessageTech, Inc. are -
Manufacturing automation
– Messagetech Customize 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.
Creating value in data economy
– The success of analytics program of Messagetech Customize has opened avenues for new revenue streams for the organization in the industry. This can help Messagetech Customize to build a more holistic ecosystem as suggested in the MessageTech, Inc. case study. Messagetech Customize can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Leveraging digital technologies
– Messagetech Customize can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Strategy & Execution industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Messagetech Customize 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. Messagetech Customize 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Messagetech Customize 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 Messagetech Customize 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.
Learning at scale
– Online learning technologies has now opened space for Messagetech Customize 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.
Developing new processes and practices
– Messagetech Customize 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Messagetech Customize can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Messagetech Customize 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 Messagetech Customize to hire the very best people irrespective of their geographical location.
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 Messagetech Customize in the consumer business. Now Messagetech Customize can target international markets with far fewer capital restrictions requirements than the existing system.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Messagetech Customize is facing challenges because of the dominance of functional experts in the organization. MessageTech, 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.
Using analytics as competitive advantage
– Messagetech Customize 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 MessageTech, Inc. - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Messagetech Customize to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats MessageTech, Inc. External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study MessageTech, Inc. are -
Increasing wage structure of Messagetech Customize
– 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 Messagetech Customize.
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 Messagetech Customize.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Messagetech Customize 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 MessageTech, Inc. .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Messagetech Customize 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study MessageTech, Inc., Messagetech Customize 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 Messagetech Customize with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Technology acceleration in Forth Industrial Revolution
– Messagetech Customize has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Messagetech Customize 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.
Shortening product life cycle
– it is one of the major threat that Messagetech Customize is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Messagetech Customize 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.
Consumer confidence and its impact on Messagetech Customize 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.
Stagnating economy with rate increase
– Messagetech Customize 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.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Easy access to finance
– Easy access to finance in Strategy & Execution field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Messagetech Customize can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of MessageTech, 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 MessageTech, 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 MessageTech, 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 MessageTech, 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 MessageTech, 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 Messagetech Customize needs to make to build a sustainable competitive advantage.
