Case Study Description of Clear Channel (A): The Rise, 1972-2003
At the end of 2003, Clear Channel Communications, Inc., a diversified media group with revenues of $8.9 billion, could claim leadership positions in all three of its main businesses. Clear Channel Broadcasting was the largest radio-station operator in the world, with sales of $3.7 billion and EBITDA of $1.6 billion. Clear Channel Outdoor was the largest outdoor advertiser in the world, with revenues of $2.2 billion generating EBITDA of $581 million. Clear Channel Entertainment was the world's largest live-entertainment promoter with revenues of $2.6 billion and EBITDA of $191 million. Media entrepreneur L. Lowry Mays (MBA 1962) had built Clear Channel through a concerted campaign of acquisitions over 30 years by consolidating fragmented media businesses, delighting shareholders in the process. But maintaining the pace of acquisitions was proving challenging, and the synergies he had hoped for between his businesses had proven elusive. Shareholders were upset. How might Mays return Clear Channel to its former glory?
Swot Analysis of "Clear Channel (A): The Rise, 1972-2003" written by John R. Wells, Gabriel Ellsworth includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Channel Ebitda facing as an external strategic factors. Some of the topics covered in Clear Channel (A): The Rise, 1972-2003 case study are - Strategic Management Strategies, Financial analysis, Financial markets, Growth strategy, Marketing, Mergers & acquisitions, Policy, Regulation, Risk management, Technology and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Clear Channel (A): The Rise, 1972-2003 casestudy better are - – increasing government debt because of Covid-19 spendings, digital marketing is dominated by two big players Facebook and Google, challanges to central banks by blockchain based private currencies, wage bills are increasing, increasing inequality as vast percentage of new income is going to the top 1%, increasing household debt because of falling income levels, geopolitical disruptions,
supply chains are disrupted by pandemic , there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Clear Channel (A): The Rise, 1972-2003
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Clear Channel (A): The Rise, 1972-2003 case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Channel Ebitda, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Channel Ebitda 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 Clear Channel (A): The Rise, 1972-2003 can be done for the following purposes –
1. Strategic planning using facts provided in Clear Channel (A): The Rise, 1972-2003 case study
2. Improving business portfolio management of Channel Ebitda
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 Channel Ebitda
Strengths Clear Channel (A): The Rise, 1972-2003 | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Channel Ebitda in Clear Channel (A): The Rise, 1972-2003 Harvard Business Review case study are -
Strong track record of project management
– Channel Ebitda 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 Channel Ebitda in the sector have low bargaining power. Clear Channel (A): The Rise, 1972-2003 has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Channel Ebitda to manage not only supply disruptions but also source products at highly competitive prices.
Innovation driven organization
– Channel Ebitda is one of the most innovative firm in sector. Manager in Clear Channel (A): The Rise, 1972-2003 Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Sustainable margins compare to other players in Strategy & Execution industry
– Clear Channel (A): The Rise, 1972-2003 firm has clearly differentiated products in the market place. This has enabled Channel Ebitda to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Channel Ebitda to invest into research and development (R&D) and innovation.
Effective Research and Development (R&D)
– Channel Ebitda 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 Clear Channel (A): The Rise, 1972-2003 - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Highly skilled collaborators
– Channel Ebitda 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 Clear Channel (A): The Rise, 1972-2003 HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Channel Ebitda digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Channel Ebitda 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.
Successful track record of launching new products
– Channel Ebitda has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Channel Ebitda 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 lead change in Strategy & Execution field
– Channel Ebitda 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 Channel Ebitda in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Learning organization
- Channel Ebitda 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 Channel Ebitda is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Clear Channel (A): The Rise, 1972-2003 Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Channel Ebitda is present in almost all the verticals within the industry. This has provided firm in Clear Channel (A): The Rise, 1972-2003 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 Channel Ebitda
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Channel Ebitda does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses Clear Channel (A): The Rise, 1972-2003 | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Clear Channel (A): The Rise, 1972-2003 are -
High bargaining power of channel partners
– Because of the regulatory requirements, John R. Wells, Gabriel Ellsworth suggests that, Channel Ebitda is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Clear Channel (A): The Rise, 1972-2003 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 Channel Ebitda has relatively successful track record of launching new products.
Interest costs
– Compare to the competition, Channel Ebitda 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.
No frontier risks strategy
– After analyzing the HBR case study Clear Channel (A): The Rise, 1972-2003, 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Clear Channel (A): The Rise, 1972-2003, is just above the industry average. Channel Ebitda 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Channel Ebitda 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.
Slow to strategic competitive environment developments
– As Clear Channel (A): The Rise, 1972-2003 HBR case study mentions - Channel Ebitda 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Clear Channel (A): The Rise, 1972-2003, in the dynamic environment Channel Ebitda has struggled to respond to the nimble upstart competition. Channel Ebitda has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Skills based hiring
– The stress on hiring functional specialists at Channel Ebitda 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.
Increasing silos among functional specialists
– The organizational structure of Channel Ebitda is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Channel Ebitda needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Channel Ebitda to focus more on services rather than just following the product oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Channel Ebitda 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 Clear Channel (A): The Rise, 1972-2003 | 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 Clear Channel (A): The Rise, 1972-2003 are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Channel Ebitda 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.
Developing new processes and practices
– Channel Ebitda 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.
Leveraging digital technologies
– Channel Ebitda 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Channel Ebitda 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.
Building a culture of innovation
– managers at Channel Ebitda 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.
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 Channel Ebitda 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.
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. Channel Ebitda can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Creating value in data economy
– The success of analytics program of Channel Ebitda has opened avenues for new revenue streams for the organization in the industry. This can help Channel Ebitda to build a more holistic ecosystem as suggested in the Clear Channel (A): The Rise, 1972-2003 case study. Channel Ebitda can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Channel Ebitda 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 Channel Ebitda to hire the very best people irrespective of their geographical location.
Manufacturing automation
– Channel Ebitda 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Strategy & Execution industry, but it has also influenced the consumer preferences. Channel Ebitda can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Channel Ebitda can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Buying journey improvements
– Channel Ebitda can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Clear Channel (A): The Rise, 1972-2003 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.
Threats Clear Channel (A): The Rise, 1972-2003 External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Clear Channel (A): The Rise, 1972-2003 are -
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 Channel Ebitda business can come under increasing regulations regarding data privacy, data security, etc.
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 Channel Ebitda.
Stagnating economy with rate increase
– Channel Ebitda 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Clear Channel (A): The Rise, 1972-2003, Channel Ebitda 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 .
Environmental challenges
– Channel Ebitda 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. Channel Ebitda can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Increasing wage structure of Channel Ebitda
– 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 Channel Ebitda.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Channel Ebitda 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.
Regulatory challenges
– Channel Ebitda 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. Channel Ebitda can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Channel Ebitda with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Channel Ebitda 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 Clear Channel (A): The Rise, 1972-2003 .
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.
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.
Weighted SWOT Analysis of Clear Channel (A): The Rise, 1972-2003 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 Clear Channel (A): The Rise, 1972-2003 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 Clear Channel (A): The Rise, 1972-2003 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 Clear Channel (A): The Rise, 1972-2003 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 Clear Channel (A): The Rise, 1972-2003 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 Channel Ebitda needs to make to build a sustainable competitive advantage.