Case Study Description of Guest-Tek Interactive Entertainment: International Sales
The chief executive officer of Calgary-based Guest-Tek Interactive Entertainment Ltd., a leading provider of high-speed Internet access to the hotel industry, must consider whether and how his company should grow its business overseas. Ninety-seven percent of Guest-Tek's fiscal year 2003 revenue was derived from North American hotels--a market he knew would eventually become saturated. Guest-Tek had listed publicly in January 2004. Both internal and external investors now demanded results. Other geographic markets held the promise of new growth and competitors were already pursuing those opportunities.
Swot Analysis of "Guest-Tek Interactive Entertainment: International Sales" written by Laurie Milton, Nigel Goodwin includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Tek Guest facing as an external strategic factors. Some of the topics covered in Guest-Tek Interactive Entertainment: International Sales case study are - Strategic Management Strategies, Globalization, Internet, Marketing and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Guest-Tek Interactive Entertainment: International Sales casestudy better are - – increasing transportation and logistics costs, talent flight as more people leaving formal jobs, supply chains are disrupted by pandemic , increasing commodity prices, cloud computing is disrupting traditional business models, increasing inequality as vast percentage of new income is going to the top 1%, digital marketing is dominated by two big players Facebook and Google,
geopolitical disruptions, increasing energy prices, etc
Introduction to SWOT Analysis of Guest-Tek Interactive Entertainment: International Sales
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Guest-Tek Interactive Entertainment: International Sales case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Tek Guest, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Tek Guest 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 Guest-Tek Interactive Entertainment: International Sales can be done for the following purposes –
1. Strategic planning using facts provided in Guest-Tek Interactive Entertainment: International Sales case study
2. Improving business portfolio management of Tek Guest
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 Tek Guest
Strengths Guest-Tek Interactive Entertainment: International Sales | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Tek Guest in Guest-Tek Interactive Entertainment: International Sales Harvard Business Review case study are -
Operational resilience
– The operational resilience strategy in the Guest-Tek Interactive Entertainment: International Sales 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.
Sustainable margins compare to other players in Strategy & Execution industry
– Guest-Tek Interactive Entertainment: International Sales firm has clearly differentiated products in the market place. This has enabled Tek Guest to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Tek Guest to invest into research and development (R&D) and innovation.
High brand equity
– Tek Guest has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Tek Guest to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Superior customer experience
– The customer experience strategy of Tek Guest in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Strong track record of project management
– Tek Guest is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to lead change in Strategy & Execution field
– Tek Guest 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 Tek Guest in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Diverse revenue streams
– Tek Guest is present in almost all the verticals within the industry. This has provided firm in Guest-Tek Interactive Entertainment: International Sales 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.
Organizational Resilience of Tek Guest
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Tek Guest does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Tek Guest is one of the leading recruiters in the industry. Managers in the Guest-Tek Interactive Entertainment: International Sales are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Training and development
– Tek Guest has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Guest-Tek Interactive Entertainment: International Sales 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.
Innovation driven organization
– Tek Guest is one of the most innovative firm in sector. Manager in Guest-Tek Interactive Entertainment: International Sales Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Analytics focus
– Tek Guest 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 Laurie Milton, Nigel Goodwin 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 Guest-Tek Interactive Entertainment: International Sales | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Guest-Tek Interactive Entertainment: International Sales are -
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Guest-Tek Interactive Entertainment: International Sales, it seems that the employees of Tek Guest 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.
Need for greater diversity
– Tek Guest 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.
Aligning sales with marketing
– It come across in the case study Guest-Tek Interactive Entertainment: International Sales 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 Guest-Tek Interactive Entertainment: International Sales can leverage the sales team experience to cultivate customer relationships as Tek Guest is planning to shift buying processes online.
Slow to strategic competitive environment developments
– As Guest-Tek Interactive Entertainment: International Sales HBR case study mentions - Tek Guest 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.
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 Tek Guest supply chain. Even after few cautionary changes mentioned in the HBR case study - Guest-Tek Interactive Entertainment: International Sales, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Tek Guest vulnerable to further global disruptions in South East Asia.
Increasing silos among functional specialists
– The organizational structure of Tek Guest is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Tek Guest needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Tek Guest to focus more on services rather than just following the product oriented approach.
Lack of clear differentiation of Tek Guest products
– To increase the profitability and margins on the products, Tek Guest needs to provide more differentiated products than what it is currently offering in the marketplace.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Guest-Tek Interactive Entertainment: International Sales, in the dynamic environment Tek Guest has struggled to respond to the nimble upstart competition. Tek Guest 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 Guest-Tek Interactive Entertainment: International Sales 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 Tek Guest 's lucrative customers.
High cash cycle compare to competitors
Tek Guest 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Guest-Tek Interactive Entertainment: International Sales 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 Tek Guest has relatively successful track record of launching new products.
Opportunities Guest-Tek Interactive Entertainment: International Sales | 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 Guest-Tek Interactive Entertainment: International Sales are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Tek Guest can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Learning at scale
– Online learning technologies has now opened space for Tek Guest 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.
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 Tek Guest 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Tek Guest 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, Guest-Tek Interactive Entertainment: International Sales, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Manufacturing automation
– Tek Guest 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.
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. Tek Guest 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. Tek Guest can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Developing new processes and practices
– Tek Guest 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.
Buying journey improvements
– Tek Guest can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Guest-Tek Interactive Entertainment: International Sales 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Tek Guest 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 Tek Guest to hire the very best people irrespective of their geographical location.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Tek Guest 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.
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 Tek Guest in the consumer business. Now Tek Guest can target international markets with far fewer capital restrictions requirements than the existing system.
Using analytics as competitive advantage
– Tek Guest 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 Guest-Tek Interactive Entertainment: International Sales - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Tek Guest to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Building a culture of innovation
– managers at Tek Guest 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.
Threats Guest-Tek Interactive Entertainment: International Sales External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Guest-Tek Interactive Entertainment: International Sales are -
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 Tek Guest in the Strategy & Execution sector and impact the bottomline of the organization.
Regulatory challenges
– Tek Guest 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.
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. Tek Guest can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing wage structure of Tek Guest
– 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 Tek Guest.
Environmental challenges
– Tek Guest needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Tek Guest can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Tek Guest needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
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. Tek Guest 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.
Shortening product life cycle
– it is one of the major threat that Tek Guest 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 Tek Guest 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
– Tek Guest has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Tek Guest 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.
Consumer confidence and its impact on Tek Guest 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.
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.
High dependence on third party suppliers
– Tek Guest 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.
Weighted SWOT Analysis of Guest-Tek Interactive Entertainment: International Sales 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 Guest-Tek Interactive Entertainment: International Sales 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 Guest-Tek Interactive Entertainment: International Sales 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 Guest-Tek Interactive Entertainment: International Sales 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 Guest-Tek Interactive Entertainment: International Sales 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 Tek Guest needs to make to build a sustainable competitive advantage.