Microsoft's Acquisition of Sendit (C): The Integration Challenge SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Microsoft's Acquisition of Sendit (C): The Integration Challenge
The case describes Microsoft's first significant acquisition in Europe and its first in the telecom equipment (software) market. SendIt is a publicly listed Swedish start-up, which offers the only Windows based solutions to the IP-based mobile phone services market. The acquisition starts in high tone, loses momentum and is finally integrated with some degree of success.
Swot Analysis of "Microsoft's Acquisition of Sendit (C): The Integration Challenge" written by Maurizio Zollo, Robert J. Crawford includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Sendit Microsoft's facing as an external strategic factors. Some of the topics covered in Microsoft's Acquisition of Sendit (C): The Integration Challenge case study are - Strategic Management Strategies, Financial analysis, Mergers & acquisitions, Negotiations and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Microsoft's Acquisition of Sendit (C): The Integration Challenge casestudy better are - – talent flight as more people leaving formal jobs, supply chains are disrupted by pandemic , wage bills are increasing, increasing household debt because of falling income levels, increasing government debt because of Covid-19 spendings, increasing inequality as vast percentage of new income is going to the top 1%, challanges to central banks by blockchain based private currencies,
there is increasing trade war between United States & China, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of Microsoft's Acquisition of Sendit (C): The Integration Challenge
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Microsoft's Acquisition of Sendit (C): The Integration Challenge case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Sendit Microsoft's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Sendit Microsoft's 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 Microsoft's Acquisition of Sendit (C): The Integration Challenge can be done for the following purposes –
1. Strategic planning using facts provided in Microsoft's Acquisition of Sendit (C): The Integration Challenge case study
2. Improving business portfolio management of Sendit Microsoft's
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 Sendit Microsoft's
Strengths Microsoft's Acquisition of Sendit (C): The Integration Challenge | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Sendit Microsoft's in Microsoft's Acquisition of Sendit (C): The Integration Challenge Harvard Business Review case study are -
Effective Research and Development (R&D)
– Sendit Microsoft's 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 Microsoft's Acquisition of Sendit (C): The Integration Challenge - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Sustainable margins compare to other players in Strategy & Execution industry
– Microsoft's Acquisition of Sendit (C): The Integration Challenge firm has clearly differentiated products in the market place. This has enabled Sendit Microsoft's to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Sendit Microsoft's to invest into research and development (R&D) and innovation.
High switching costs
– The high switching costs that Sendit Microsoft's 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.
Organizational Resilience of Sendit Microsoft's
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Sendit Microsoft's does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Strong track record of project management
– Sendit Microsoft's is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Diverse revenue streams
– Sendit Microsoft's is present in almost all the verticals within the industry. This has provided firm in Microsoft's Acquisition of Sendit (C): The Integration Challenge 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.
Cross disciplinary teams
– Horizontal connected teams at the Sendit Microsoft's 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.
High brand equity
– Sendit Microsoft's has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Sendit Microsoft's to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Highly skilled collaborators
– Sendit Microsoft's 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 Microsoft's Acquisition of Sendit (C): The Integration Challenge HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to lead change in Strategy & Execution field
– Sendit Microsoft's 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 Sendit Microsoft's in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Analytics focus
– Sendit Microsoft's 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 Maurizio Zollo, Robert J. Crawford 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.
Operational resilience
– The operational resilience strategy in the Microsoft's Acquisition of Sendit (C): The Integration Challenge Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Weaknesses Microsoft's Acquisition of Sendit (C): The Integration Challenge | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Microsoft's Acquisition of Sendit (C): The Integration Challenge are -
Lack of clear differentiation of Sendit Microsoft's products
– To increase the profitability and margins on the products, Sendit Microsoft's needs to provide more differentiated products than what it is currently offering in the marketplace.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Microsoft's Acquisition of Sendit (C): The Integration Challenge 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 Sendit Microsoft's has relatively successful track record of launching new products.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Sendit Microsoft's supply chain. Even after few cautionary changes mentioned in the HBR case study - Microsoft's Acquisition of Sendit (C): The Integration Challenge, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Sendit Microsoft's vulnerable to further global disruptions in South East Asia.
Skills based hiring
– The stress on hiring functional specialists at Sendit Microsoft's 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Microsoft's Acquisition of Sendit (C): The Integration Challenge, is just above the industry average. Sendit Microsoft's 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.
Need for greater diversity
– Sendit Microsoft's 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Microsoft's Acquisition of Sendit (C): The Integration Challenge, it seems that the employees of Sendit Microsoft's 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Microsoft's Acquisition of Sendit (C): The Integration Challenge, in the dynamic environment Sendit Microsoft's has struggled to respond to the nimble upstart competition. Sendit Microsoft's has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Products dominated business model
– Even though Sendit Microsoft's 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 - Microsoft's Acquisition of Sendit (C): The Integration Challenge should strive to include more intangible value offerings along with its core products and services.
No frontier risks strategy
– After analyzing the HBR case study Microsoft's Acquisition of Sendit (C): The Integration Challenge, 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.
Low market penetration in new markets
– Outside its home market of Sendit Microsoft's, firm in the HBR case study Microsoft's Acquisition of Sendit (C): The Integration Challenge needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Opportunities Microsoft's Acquisition of Sendit (C): The Integration Challenge | 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 Microsoft's Acquisition of Sendit (C): The Integration Challenge are -
Manufacturing automation
– Sendit Microsoft's 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.
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 Sendit Microsoft's in the consumer business. Now Sendit Microsoft's can target international markets with far fewer capital restrictions requirements than the existing system.
Buying journey improvements
– Sendit Microsoft's can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Microsoft's Acquisition of Sendit (C): The Integration Challenge 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Sendit Microsoft's 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Sendit Microsoft's is facing challenges because of the dominance of functional experts in the organization. Microsoft's Acquisition of Sendit (C): The Integration Challenge 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.
Using analytics as competitive advantage
– Sendit Microsoft's 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 Microsoft's Acquisition of Sendit (C): The Integration Challenge - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Sendit Microsoft's 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 Sendit Microsoft's 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Sendit Microsoft's can use these opportunities to build new business models that can help the communities that Sendit Microsoft's operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
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. Sendit Microsoft's can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Creating value in data economy
– The success of analytics program of Sendit Microsoft's has opened avenues for new revenue streams for the organization in the industry. This can help Sendit Microsoft's to build a more holistic ecosystem as suggested in the Microsoft's Acquisition of Sendit (C): The Integration Challenge case study. Sendit Microsoft's can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Leveraging digital technologies
– Sendit Microsoft's 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, Sendit Microsoft's 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.
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 Sendit Microsoft's 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.
Threats Microsoft's Acquisition of Sendit (C): The Integration Challenge External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Microsoft's Acquisition of Sendit (C): The Integration Challenge are -
Increasing wage structure of Sendit Microsoft's
– 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 Sendit Microsoft's.
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 Sendit Microsoft's in the Strategy & Execution sector and impact the bottomline of the organization.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Sendit Microsoft's 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 Sendit Microsoft's 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
– Sendit Microsoft's 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 Microsoft's Acquisition of Sendit (C): The Integration Challenge, Sendit Microsoft's 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 .
Shortening product life cycle
– it is one of the major threat that Sendit Microsoft's is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, 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 Sendit Microsoft's.
Regulatory challenges
– Sendit Microsoft's 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. Sendit Microsoft's can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Sendit Microsoft's 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 Microsoft's Acquisition of Sendit (C): The Integration Challenge .
Weighted SWOT Analysis of Microsoft's Acquisition of Sendit (C): The Integration Challenge 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 Microsoft's Acquisition of Sendit (C): The Integration Challenge 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 Microsoft's Acquisition of Sendit (C): The Integration Challenge 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 Microsoft's Acquisition of Sendit (C): The Integration Challenge 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 Microsoft's Acquisition of Sendit (C): The Integration Challenge 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 Sendit Microsoft's needs to make to build a sustainable competitive advantage.
