Outrage in Cyberspace: CompuServe and the GIF Patent SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Outrage in Cyberspace: CompuServe and the GIF Patent
CompuServe, an online services vendor, informs its software developers that they must enter into a licensing agreement to use the popular GIF compression. CompuServe claims that it is forced to do so because Unisys is enforcing its patent rights in this area. Others argue that CompuServe's move is a response to the growing competitive challenge posed by the Internet.
Swot Analysis of "Outrage in Cyberspace: CompuServe and the GIF Patent" written by Josh Lerner, Benjamin Conway includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Compuserve Gif facing as an external strategic factors. Some of the topics covered in Outrage in Cyberspace: CompuServe and the GIF Patent case study are - Strategic Management Strategies, Innovation, Intellectual property, IT and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Outrage in Cyberspace: CompuServe and the GIF Patent casestudy better are - – increasing transportation and logistics costs, banking and financial system is disrupted by Bitcoin and other crypto currencies, digital marketing is dominated by two big players Facebook and Google, increasing household debt because of falling income levels, technology disruption, increasing inequality as vast percentage of new income is going to the top 1%, increasing government debt because of Covid-19 spendings,
geopolitical disruptions, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Outrage in Cyberspace: CompuServe and the GIF Patent
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Outrage in Cyberspace: CompuServe and the GIF Patent case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Compuserve Gif, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Compuserve Gif 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 Outrage in Cyberspace: CompuServe and the GIF Patent can be done for the following purposes –
1. Strategic planning using facts provided in Outrage in Cyberspace: CompuServe and the GIF Patent case study
2. Improving business portfolio management of Compuserve Gif
3. Assessing feasibility of the new initiative in Finance & Accounting field.
4. Making a Finance & Accounting topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Compuserve Gif
Strengths Outrage in Cyberspace: CompuServe and the GIF Patent | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Compuserve Gif in Outrage in Cyberspace: CompuServe and the GIF Patent Harvard Business Review case study are -
Training and development
– Compuserve Gif has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Outrage in Cyberspace: CompuServe and the GIF Patent 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.
High brand equity
– Compuserve Gif has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Compuserve Gif to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Analytics focus
– Compuserve Gif 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 Josh Lerner, Benjamin Conway 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.
Sustainable margins compare to other players in Finance & Accounting industry
– Outrage in Cyberspace: CompuServe and the GIF Patent firm has clearly differentiated products in the market place. This has enabled Compuserve Gif to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Compuserve Gif to invest into research and development (R&D) and innovation.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Compuserve Gif digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Compuserve Gif 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.
Innovation driven organization
– Compuserve Gif is one of the most innovative firm in sector. Manager in Outrage in Cyberspace: CompuServe and the GIF Patent Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
High switching costs
– The high switching costs that Compuserve Gif 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.
Strong track record of project management
– Compuserve Gif 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 Compuserve Gif in the sector have low bargaining power. Outrage in Cyberspace: CompuServe and the GIF Patent has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Compuserve Gif to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Compuserve Gif in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the Compuserve Gif are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Effective Research and Development (R&D)
– Compuserve Gif 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 Outrage in Cyberspace: CompuServe and the GIF Patent - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses Outrage in Cyberspace: CompuServe and the GIF Patent | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Outrage in Cyberspace: CompuServe and the GIF Patent are -
Capital Spending Reduction
– Even during the low interest decade, Compuserve Gif 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.
Products dominated business model
– Even though Compuserve Gif 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 - Outrage in Cyberspace: CompuServe and the GIF Patent should strive to include more intangible value offerings along with its core products and services.
Lack of clear differentiation of Compuserve Gif products
– To increase the profitability and margins on the products, Compuserve Gif needs to provide more differentiated products than what it is currently offering in the marketplace.
Workers concerns about automation
– As automation is fast increasing in the segment, Compuserve Gif 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Outrage in Cyberspace: CompuServe and the GIF Patent, it seems that the employees of Compuserve Gif 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.
Slow decision making process
– As mentioned earlier in the report, Compuserve Gif has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Compuserve Gif even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
No frontier risks strategy
– After analyzing the HBR case study Outrage in Cyberspace: CompuServe and the GIF Patent, it seems that company is thinking about the frontier risks that can impact Finance & Accounting 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Outrage in Cyberspace: CompuServe and the GIF Patent 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 Compuserve Gif 's lucrative customers.
High bargaining power of channel partners
– Because of the regulatory requirements, Josh Lerner, Benjamin Conway suggests that, Compuserve Gif 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 cash cycle compare to competitors
Compuserve Gif 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.
Interest costs
– Compare to the competition, Compuserve Gif 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.
Opportunities Outrage in Cyberspace: CompuServe and the GIF Patent | 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 Outrage in Cyberspace: CompuServe and the GIF Patent are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Compuserve Gif 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 Compuserve Gif to hire the very best people irrespective of their geographical location.
Leveraging digital technologies
– Compuserve Gif 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.
Building a culture of innovation
– managers at Compuserve Gif 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 Finance & Accounting segment.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Compuserve Gif in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Finance & Accounting segment, and it will provide faster access to the consumers.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Compuserve Gif 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, Outrage in Cyberspace: CompuServe and the GIF Patent, 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
– Compuserve Gif can use the latest technology developments to improve its manufacturing and designing process in Finance & Accounting 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.
Better consumer reach
– The expansion of the 5G network will help Compuserve Gif to increase its market reach. Compuserve Gif will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Using analytics as competitive advantage
– Compuserve Gif 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 Outrage in Cyberspace: CompuServe and the GIF Patent - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Compuserve Gif to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Buying journey improvements
– Compuserve Gif can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Outrage in Cyberspace: CompuServe and the GIF Patent 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Finance & Accounting industry, but it has also influenced the consumer preferences. Compuserve Gif can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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 Compuserve Gif in the consumer business. Now Compuserve Gif 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 Compuserve Gif 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Compuserve Gif is facing challenges because of the dominance of functional experts in the organization. Outrage in Cyberspace: CompuServe and the GIF Patent 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.
Threats Outrage in Cyberspace: CompuServe and the GIF Patent External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Outrage in Cyberspace: CompuServe and the GIF Patent are -
Stagnating economy with rate increase
– Compuserve Gif 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.
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 Compuserve Gif in the Finance & Accounting sector and impact the bottomline 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. Compuserve Gif 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Compuserve Gif with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Consumer confidence and its impact on Compuserve Gif 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.
Technology acceleration in Forth Industrial Revolution
– Compuserve Gif has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Compuserve Gif needs to keep up with the evolution of technology in the Finance & Accounting 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.
Increasing wage structure of Compuserve Gif
– 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 Compuserve Gif.
High dependence on third party suppliers
– Compuserve Gif 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.
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 Compuserve Gif.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Outrage in Cyberspace: CompuServe and the GIF Patent, Compuserve Gif may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Finance & Accounting .
Environmental challenges
– Compuserve Gif 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. Compuserve Gif can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Compuserve Gif 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 Outrage in Cyberspace: CompuServe and the GIF Patent .
Weighted SWOT Analysis of Outrage in Cyberspace: CompuServe and the GIF Patent 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 Outrage in Cyberspace: CompuServe and the GIF Patent 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 Outrage in Cyberspace: CompuServe and the GIF Patent 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 Outrage in Cyberspace: CompuServe and the GIF Patent 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 Outrage in Cyberspace: CompuServe and the GIF Patent 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 Compuserve Gif needs to make to build a sustainable competitive advantage.