OWC Watch Company: Facing the Hard Truth of Success and Failure SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of OWC Watch Company: Facing the Hard Truth of Success and Failure
In December 2013, an entrepreneur based in Orange, a small town in Australia, is considering the difficulties besetting his five-year-old start-up, the Orange Watch Company. He faces seemingly insurmountable challenges: his business is located far away from major cities; Australia is not close to the demand or supply market for high-end watches and watch parts, which is largely in Asia and Europe; and he has limited financial resources. Yet he continues to persist in his efforts to grow the firm. He has come close to bankruptcy several times and his venture is far from being able to provide a steady stream of income. He is wondering whether to continue to push forward or if he should shut his business down.
Swot Analysis of "OWC Watch Company: Facing the Hard Truth of Success and Failure" written by J. Robert Mitchell, Ken Mark includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Watch Orange facing as an external strategic factors. Some of the topics covered in OWC Watch Company: Facing the Hard Truth of Success and Failure case study are - Strategic Management Strategies, Innovation, Market research, Organizational culture and Strategy & Execution.
Some of the macro environment factors that can be used to understand the OWC Watch Company: Facing the Hard Truth of Success and Failure casestudy better are - – challanges to central banks by blockchain based private currencies, technology disruption, increasing transportation and logistics costs, banking and financial system is disrupted by Bitcoin and other crypto currencies, there is backlash against globalization, increasing commodity prices, digital marketing is dominated by two big players Facebook and Google,
wage bills are increasing, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of OWC Watch Company: Facing the Hard Truth of Success and Failure
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in OWC Watch Company: Facing the Hard Truth of Success and Failure case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Watch Orange, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Watch Orange 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 OWC Watch Company: Facing the Hard Truth of Success and Failure can be done for the following purposes –
1. Strategic planning using facts provided in OWC Watch Company: Facing the Hard Truth of Success and Failure case study
2. Improving business portfolio management of Watch Orange
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 Watch Orange
Strengths OWC Watch Company: Facing the Hard Truth of Success and Failure | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Watch Orange in OWC Watch Company: Facing the Hard Truth of Success and Failure Harvard Business Review case study are -
Analytics focus
– Watch Orange 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 J. Robert Mitchell, Ken Mark 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.
High brand equity
– Watch Orange has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Watch Orange to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Successful track record of launching new products
– Watch Orange has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Watch Orange 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.
Training and development
– Watch Orange has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in OWC Watch Company: Facing the Hard Truth of Success and Failure 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.
Low bargaining power of suppliers
– Suppliers of Watch Orange in the sector have low bargaining power. OWC Watch Company: Facing the Hard Truth of Success and Failure has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Watch Orange to manage not only supply disruptions but also source products at highly competitive prices.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Watch Orange digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Watch Orange has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
High switching costs
– The high switching costs that Watch Orange 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.
Ability to recruit top talent
– Watch Orange is one of the leading recruiters in the industry. Managers in the OWC Watch Company: Facing the Hard Truth of Success and Failure are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Ability to lead change in Strategy & Execution field
– Watch Orange 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 Watch Orange in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Learning organization
- Watch Orange 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 Watch Orange is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in OWC Watch Company: Facing the Hard Truth of Success and Failure Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Strong track record of project management
– Watch Orange is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Sustainable margins compare to other players in Strategy & Execution industry
– OWC Watch Company: Facing the Hard Truth of Success and Failure firm has clearly differentiated products in the market place. This has enabled Watch Orange to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Watch Orange to invest into research and development (R&D) and innovation.
Weaknesses OWC Watch Company: Facing the Hard Truth of Success and Failure | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of OWC Watch Company: Facing the Hard Truth of Success and Failure are -
Slow to strategic competitive environment developments
– As OWC Watch Company: Facing the Hard Truth of Success and Failure HBR case study mentions - Watch Orange 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.
Need for greater diversity
– Watch Orange 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.
Lack of clear differentiation of Watch Orange products
– To increase the profitability and margins on the products, Watch Orange needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Watch Orange is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study OWC Watch Company: Facing the Hard Truth of Success and Failure can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Increasing silos among functional specialists
– The organizational structure of Watch Orange is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Watch Orange needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Watch Orange to focus more on services rather than just following the product oriented approach.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the OWC Watch Company: Facing the Hard Truth of Success and Failure 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 Watch Orange has relatively successful track record of launching new products.
High operating costs
– Compare to the competitors, firm in the HBR case study OWC Watch Company: Facing the Hard Truth of Success and Failure 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 Watch Orange 's lucrative customers.
Skills based hiring
– The stress on hiring functional specialists at Watch Orange 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.
Interest costs
– Compare to the competition, Watch Orange 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.
High cash cycle compare to competitors
Watch Orange 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.
Low market penetration in new markets
– Outside its home market of Watch Orange, firm in the HBR case study OWC Watch Company: Facing the Hard Truth of Success and Failure needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Opportunities OWC Watch Company: Facing the Hard Truth of Success and Failure | 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 OWC Watch Company: Facing the Hard Truth of Success and Failure are -
Loyalty marketing
– Watch Orange 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Watch Orange 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, OWC Watch Company: Facing the Hard Truth of Success and Failure, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Developing new processes and practices
– Watch Orange 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.
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 Watch Orange in the consumer business. Now Watch Orange can target international markets with far fewer capital restrictions requirements than the existing system.
Learning at scale
– Online learning technologies has now opened space for Watch Orange 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.
Leveraging digital technologies
– Watch Orange 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Watch Orange in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Strategy & Execution segment, and it will provide faster access to the consumers.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Watch Orange 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. Watch Orange 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, Watch Orange is facing challenges because of the dominance of functional experts in the organization. OWC Watch Company: Facing the Hard Truth of Success and Failure 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Watch Orange can use these opportunities to build new business models that can help the communities that Watch Orange operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Low interest rates
– Even though inflation is raising its head in most developed economies, Watch Orange 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Watch Orange can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats OWC Watch Company: Facing the Hard Truth of Success and Failure External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study OWC Watch Company: Facing the Hard Truth of Success and Failure are -
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.
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.
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. Watch Orange 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 Watch Orange is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Watch Orange needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Consumer confidence and its impact on Watch Orange 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.
Increasing wage structure of Watch Orange
– 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 Watch Orange.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Watch Orange 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, Watch Orange 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 OWC Watch Company: Facing the Hard Truth of Success and Failure .
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. Watch Orange can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
High dependence on third party suppliers
– Watch Orange 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 Watch Orange business can come under increasing regulations regarding data privacy, data security, etc.
Environmental challenges
– Watch Orange 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. Watch Orange can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Weighted SWOT Analysis of OWC Watch Company: Facing the Hard Truth of Success and Failure 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 OWC Watch Company: Facing the Hard Truth of Success and Failure 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 OWC Watch Company: Facing the Hard Truth of Success and Failure 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 OWC Watch Company: Facing the Hard Truth of Success and Failure 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 OWC Watch Company: Facing the Hard Truth of Success and Failure 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 Watch Orange needs to make to build a sustainable competitive advantage.
