The Asylum: Mocking Their Way Through Hollywood SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of The Asylum: Mocking Their Way Through Hollywood
The co-founder and chief executive officer of The Asylum, a movie production company headquartered in Burbank, California, must decide whether the company needs to explore other avenues for growth or change its current business model to boost profitability. The company has developed a unique imitation strategy to reduce the uncertainty of financial success in filmmaking - its "mockbuster" business model is to produce B-rated movies that use plotlines similar to that of major Hollywood films already in production and release them at the same time as or just before the comparable Hollywood film. It can thus take advantage of the large marketing and promotion campaigns that large film production studios employ to promote their films while producing a substantially cheaper (but somewhat similar) film. To date, all of these mockbusters have been profitable, but changes to property rights regulations and increased litigation cases may come to affect the bottom line. There are three options going forward: maintaining the status quo, focusing even more on producing mockbusters or shifting toward completely original film production. What should the company do to ensure future success?
Authors :: Bryan Hong, Stacey Clark, Charlotte Zhen
Swot Analysis of "The Asylum: Mocking Their Way Through Hollywood" written by Bryan Hong, Stacey Clark, Charlotte Zhen includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Film Asylum facing as an external strategic factors. Some of the topics covered in The Asylum: Mocking Their Way Through Hollywood case study are - Strategic Management Strategies, and Strategy & Execution.
Some of the macro environment factors that can be used to understand the The Asylum: Mocking Their Way Through Hollywood casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, there is backlash against globalization, there is increasing trade war between United States & China, cloud computing is disrupting traditional business models, banking and financial system is disrupted by Bitcoin and other crypto currencies, digital marketing is dominated by two big players Facebook and Google, increasing inequality as vast percentage of new income is going to the top 1%,
increasing transportation and logistics costs, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of The Asylum: Mocking Their Way Through Hollywood
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The Asylum: Mocking Their Way Through Hollywood case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Film Asylum, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Film Asylum 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 The Asylum: Mocking Their Way Through Hollywood can be done for the following purposes –
1. Strategic planning using facts provided in The Asylum: Mocking Their Way Through Hollywood case study
2. Improving business portfolio management of Film Asylum
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 Film Asylum
Strengths The Asylum: Mocking Their Way Through Hollywood | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Film Asylum in The Asylum: Mocking Their Way Through Hollywood Harvard Business Review case study are -
High switching costs
– The high switching costs that Film Asylum 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.
Diverse revenue streams
– Film Asylum is present in almost all the verticals within the industry. This has provided firm in The Asylum: Mocking Their Way Through Hollywood 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.
Learning organization
- Film Asylum 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 Film Asylum is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in The Asylum: Mocking Their Way Through Hollywood Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Analytics focus
– Film Asylum 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 Bryan Hong, Stacey Clark, Charlotte Zhen 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.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Film Asylum digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Film Asylum 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.
Organizational Resilience of Film Asylum
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Film Asylum does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Strong track record of project management
– Film Asylum is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Low bargaining power of suppliers
– Suppliers of Film Asylum in the sector have low bargaining power. The Asylum: Mocking Their Way Through Hollywood has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Film Asylum to manage not only supply disruptions but also source products at highly competitive prices.
High brand equity
– Film Asylum has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Film Asylum to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Superior customer experience
– The customer experience strategy of Film Asylum in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Film Asylum 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 The Asylum: Mocking Their Way Through Hollywood HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Film Asylum is one of the most innovative firm in sector. Manager in The Asylum: Mocking Their Way Through Hollywood Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Weaknesses The Asylum: Mocking Their Way Through Hollywood | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The Asylum: Mocking Their Way Through Hollywood are -
Products dominated business model
– Even though Film Asylum has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - The Asylum: Mocking Their Way Through Hollywood should strive to include more intangible value offerings along with its core products and services.
Increasing silos among functional specialists
– The organizational structure of Film Asylum is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Film Asylum needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Film Asylum to focus more on services rather than just following the product oriented approach.
No frontier risks strategy
– After analyzing the HBR case study The Asylum: Mocking Their Way Through Hollywood, 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.
Slow to strategic competitive environment developments
– As The Asylum: Mocking Their Way Through Hollywood HBR case study mentions - Film Asylum 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 bargaining power of channel partners
– Because of the regulatory requirements, Bryan Hong, Stacey Clark, Charlotte Zhen suggests that, Film Asylum 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study The Asylum: Mocking Their Way Through Hollywood, is just above the industry average. Film Asylum 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the The Asylum: Mocking Their Way Through Hollywood 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 Film Asylum has relatively successful track record of launching new products.
Workers concerns about automation
– As automation is fast increasing in the segment, Film Asylum needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study The Asylum: Mocking Their Way Through Hollywood, in the dynamic environment Film Asylum has struggled to respond to the nimble upstart competition. Film Asylum has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Interest costs
– Compare to the competition, Film Asylum 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.
Need for greater diversity
– Film Asylum 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 The Asylum: Mocking Their Way Through Hollywood | 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 The Asylum: Mocking Their Way Through Hollywood are -
Manufacturing automation
– Film Asylum 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.
Loyalty marketing
– Film Asylum has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
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. Film Asylum can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Film Asylum is facing challenges because of the dominance of functional experts in the organization. The Asylum: Mocking Their Way Through Hollywood 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.
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 Film Asylum in the consumer business. Now Film Asylum 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 Film Asylum 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 Film Asylum to hire the very best people irrespective of their geographical location.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Film Asylum 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, The Asylum: Mocking Their Way Through Hollywood, 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
– Film Asylum 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 The Asylum: Mocking Their Way Through Hollywood - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Film Asylum 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 Film Asylum 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Film Asylum 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Film Asylum can use these opportunities to build new business models that can help the communities that Film Asylum operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Learning at scale
– Online learning technologies has now opened space for Film Asylum 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Film Asylum can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Threats The Asylum: Mocking Their Way Through Hollywood External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The Asylum: Mocking Their Way Through Hollywood are -
Technology acceleration in Forth Industrial Revolution
– Film Asylum has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Film Asylum 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Film Asylum 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 Film Asylum is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing wage structure of Film Asylum
– 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 Film Asylum.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Film Asylum 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 The Asylum: Mocking Their Way Through Hollywood .
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.
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. Film Asylum 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.
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.
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 Film Asylum in the Strategy & Execution sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Film Asylum 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.
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. Film Asylum can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Consumer confidence and its impact on Film Asylum 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
– Film Asylum 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.
Weighted SWOT Analysis of The Asylum: Mocking Their Way Through Hollywood 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 The Asylum: Mocking Their Way Through Hollywood 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 The Asylum: Mocking Their Way Through Hollywood 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 The Asylum: Mocking Their Way Through Hollywood 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 The Asylum: Mocking Their Way Through Hollywood 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 Film Asylum needs to make to build a sustainable competitive advantage.