Competitive Dynamics in Home Video Games (F): The Fall of 3DO SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
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Case Study SWOT Analysis Solution
Case Study Description of Competitive Dynamics in Home Video Games (F): The Fall of 3DO
Outlines the events leading up to 3DO's exit from the home video game licensing business. 3DO's business model is considered flawed because of its incompatibility with industry structure and economics.
Swot Analysis of "Competitive Dynamics in Home Video Games (F): The Fall of 3DO" written by Peter J. Coughlan, Debbie Freier includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that 3do's 3do facing as an external strategic factors. Some of the topics covered in Competitive Dynamics in Home Video Games (F): The Fall of 3DO case study are - Strategic Management Strategies, Competitive strategy, IT and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Competitive Dynamics in Home Video Games (F): The Fall of 3DO casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, there is backlash against globalization, competitive advantages are harder to sustain because of technology dispersion, geopolitical disruptions, wage bills are increasing, there is increasing trade war between United States & China, increasing household debt because of falling income levels,
talent flight as more people leaving formal jobs, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of Competitive Dynamics in Home Video Games (F): The Fall of 3DO
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Competitive Dynamics in Home Video Games (F): The Fall of 3DO case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the 3do's 3do, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which 3do's 3do 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 Competitive Dynamics in Home Video Games (F): The Fall of 3DO can be done for the following purposes –
1. Strategic planning using facts provided in Competitive Dynamics in Home Video Games (F): The Fall of 3DO case study
2. Improving business portfolio management of 3do's 3do
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 3do's 3do
Strengths Competitive Dynamics in Home Video Games (F): The Fall of 3DO | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of 3do's 3do in Competitive Dynamics in Home Video Games (F): The Fall of 3DO Harvard Business Review case study are -
Training and development
– 3do's 3do has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Competitive Dynamics in Home Video Games (F): The Fall of 3DO 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.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For 3do's 3do digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. 3do's 3do 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.
Operational resilience
– The operational resilience strategy in the Competitive Dynamics in Home Video Games (F): The Fall of 3DO 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
– 3do's 3do has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. 3do's 3do 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
- 3do's 3do 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 3do's 3do is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Competitive Dynamics in Home Video Games (F): The Fall of 3DO Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Analytics focus
– 3do's 3do 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 Peter J. Coughlan, Debbie Freier 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.
Ability to lead change in Strategy & Execution field
– 3do's 3do 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 3do's 3do in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Low bargaining power of suppliers
– Suppliers of 3do's 3do in the sector have low bargaining power. Competitive Dynamics in Home Video Games (F): The Fall of 3DO has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps 3do's 3do to manage not only supply disruptions but also source products at highly competitive prices.
Highly skilled collaborators
– 3do's 3do has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Competitive Dynamics in Home Video Games (F): The Fall of 3DO HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Diverse revenue streams
– 3do's 3do is present in almost all the verticals within the industry. This has provided firm in Competitive Dynamics in Home Video Games (F): The Fall of 3DO 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.
Innovation driven organization
– 3do's 3do is one of the most innovative firm in sector. Manager in Competitive Dynamics in Home Video Games (F): The Fall of 3DO Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Superior customer experience
– The customer experience strategy of 3do's 3do in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses Competitive Dynamics in Home Video Games (F): The Fall of 3DO | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Competitive Dynamics in Home Video Games (F): The Fall of 3DO are -
Lack of clear differentiation of 3do's 3do products
– To increase the profitability and margins on the products, 3do's 3do needs to provide more differentiated products than what it is currently offering in the marketplace.
Aligning sales with marketing
– It come across in the case study Competitive Dynamics in Home Video Games (F): The Fall of 3DO 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 Competitive Dynamics in Home Video Games (F): The Fall of 3DO can leverage the sales team experience to cultivate customer relationships as 3do's 3do is planning to shift buying processes online.
High operating costs
– Compare to the competitors, firm in the HBR case study Competitive Dynamics in Home Video Games (F): The Fall of 3DO 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 3do's 3do 's lucrative customers.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Competitive Dynamics in Home Video Games (F): The Fall of 3DO, in the dynamic environment 3do's 3do has struggled to respond to the nimble upstart competition. 3do's 3do has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow decision making process
– As mentioned earlier in the report, 3do's 3do 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. 3do's 3do 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 dependence on star products
– The top 2 products and services of the firm as mentioned in the Competitive Dynamics in Home Video Games (F): The Fall of 3DO 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 3do's 3do has relatively successful track record of launching new products.
High bargaining power of channel partners
– Because of the regulatory requirements, Peter J. Coughlan, Debbie Freier suggests that, 3do's 3do 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.
Increasing silos among functional specialists
– The organizational structure of 3do's 3do is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. 3do's 3do needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help 3do's 3do to focus more on services rather than just following the product oriented approach.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Competitive Dynamics in Home Video Games (F): The Fall of 3DO, it seems that the employees of 3do's 3do 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Competitive Dynamics in Home Video Games (F): The Fall of 3DO, is just above the industry average. 3do's 3do needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Need for greater diversity
– 3do's 3do 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.
Opportunities Competitive Dynamics in Home Video Games (F): The Fall of 3DO | 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 Competitive Dynamics in Home Video Games (F): The Fall of 3DO are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for 3do's 3do 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects 3do's 3do can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Building a culture of innovation
– managers at 3do's 3do 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, 3do's 3do can use these opportunities to build new business models that can help the communities that 3do's 3do operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for 3do's 3do 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 3do's 3do to hire the very best people irrespective of their geographical location.
Creating value in data economy
– The success of analytics program of 3do's 3do has opened avenues for new revenue streams for the organization in the industry. This can help 3do's 3do to build a more holistic ecosystem as suggested in the Competitive Dynamics in Home Video Games (F): The Fall of 3DO case study. 3do's 3do can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– 3do's 3do 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 Competitive Dynamics in Home Video Games (F): The Fall of 3DO - to build a competitive advantage using analytics. The analytics driven competitive advantage can help 3do's 3do to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. 3do's 3do 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. 3do's 3do 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.
Buying journey improvements
– 3do's 3do can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Competitive Dynamics in Home Video Games (F): The Fall of 3DO 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, 3do's 3do 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, Competitive Dynamics in Home Video Games (F): The Fall of 3DO, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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 3do's 3do in the consumer business. Now 3do's 3do can target international markets with far fewer capital restrictions requirements than the existing system.
Manufacturing automation
– 3do's 3do 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.
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 3do's 3do 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.
Threats Competitive Dynamics in Home Video Games (F): The Fall of 3DO External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Competitive Dynamics in Home Video Games (F): The Fall of 3DO are -
Stagnating economy with rate increase
– 3do's 3do 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.
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. 3do's 3do needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
High dependence on third party suppliers
– 3do's 3do 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 3do's 3do business can come under increasing regulations regarding data privacy, data security, etc.
Regulatory challenges
– 3do's 3do 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 3do's 3do in the Strategy & Execution sector and impact the bottomline of the organization.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents 3do's 3do with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Shortening product life cycle
– it is one of the major threat that 3do's 3do is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for 3do's 3do 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, 3do's 3do 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 Competitive Dynamics in Home Video Games (F): The Fall of 3DO .
Technology acceleration in Forth Industrial Revolution
– 3do's 3do has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, 3do's 3do 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.
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. 3do's 3do 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 Competitive Dynamics in Home Video Games (F): The Fall of 3DO 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 Competitive Dynamics in Home Video Games (F): The Fall of 3DO 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 Competitive Dynamics in Home Video Games (F): The Fall of 3DO 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 Competitive Dynamics in Home Video Games (F): The Fall of 3DO 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 Competitive Dynamics in Home Video Games (F): The Fall of 3DO 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 3do's 3do needs to make to build a sustainable competitive advantage.