Case Study Description of Developing a Knowledge Strategy
Today, knowledge is considered the most strategically important resource and learning the most strategically important capability for business organizations. However, many initiatives being undertaken to develop and exploit organizational knowledge are not explicitly linked to or framed by the organization's business strategy. In fact, most knowledge management initiatives are viewed primarily as information systems projects. While many managers intuitively believe that strategic advantage can come from knowing more than competitors, they are unable to explicitly articulate the link between knowledge and strategy. This article provides a framework for making that link and for assessing an organization's competitive position regarding its intellectual resources and capabilities. It recommends that organizations perform a knowledge-based SWOT (strengths, weaknesses, opportunities, and threats) analysis, comparing their knowledge to that of their competitors and to the knowledge required to execute their own strategy.
Swot Analysis of "Developing a Knowledge Strategy" written by Michael Zack includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Knowledge Explicitly facing as an external strategic factors. Some of the topics covered in Developing a Knowledge Strategy case study are - Strategic Management Strategies, IT, Knowledge management and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Developing a Knowledge Strategy casestudy better are - – there is increasing trade war between United States & China, digital marketing is dominated by two big players Facebook and Google, challanges to central banks by blockchain based private currencies, cloud computing is disrupting traditional business models, central banks are concerned over increasing inflation, increasing government debt because of Covid-19 spendings, increasing energy prices,
increasing inequality as vast percentage of new income is going to the top 1%, increasing commodity prices, etc
Introduction to SWOT Analysis of Developing a Knowledge Strategy
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Developing a Knowledge Strategy case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Knowledge Explicitly, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Knowledge Explicitly 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 Developing a Knowledge Strategy can be done for the following purposes –
1. Strategic planning using facts provided in Developing a Knowledge Strategy case study
2. Improving business portfolio management of Knowledge Explicitly
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 Knowledge Explicitly
Strengths Developing a Knowledge Strategy | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Knowledge Explicitly in Developing a Knowledge Strategy Harvard Business Review case study are -
Ability to lead change in Strategy & Execution field
– Knowledge Explicitly 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 Knowledge Explicitly in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High brand equity
– Knowledge Explicitly has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Knowledge Explicitly to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of Knowledge Explicitly in the sector have low bargaining power. Developing a Knowledge Strategy has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Knowledge Explicitly to manage not only supply disruptions but also source products at highly competitive prices.
Strong track record of project management
– Knowledge Explicitly is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Learning organization
- Knowledge Explicitly 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 Knowledge Explicitly is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Developing a Knowledge Strategy Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Knowledge Explicitly is present in almost all the verticals within the industry. This has provided firm in Developing a Knowledge Strategy 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.
High switching costs
– The high switching costs that Knowledge Explicitly 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.
Training and development
– Knowledge Explicitly has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Developing a Knowledge Strategy 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.
Superior customer experience
– The customer experience strategy of Knowledge Explicitly in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Knowledge Explicitly 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 Developing a Knowledge Strategy HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of Knowledge Explicitly
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Knowledge Explicitly does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Effective Research and Development (R&D)
– Knowledge Explicitly 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 Developing a Knowledge Strategy - 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 Developing a Knowledge Strategy | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Developing a Knowledge Strategy are -
High bargaining power of channel partners
– Because of the regulatory requirements, Michael Zack suggests that, Knowledge Explicitly is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Developing a Knowledge Strategy, is just above the industry average. Knowledge Explicitly 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Developing a Knowledge Strategy, in the dynamic environment Knowledge Explicitly has struggled to respond to the nimble upstart competition. Knowledge Explicitly has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Interest costs
– Compare to the competition, Knowledge Explicitly 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.
Aligning sales with marketing
– It come across in the case study Developing a Knowledge Strategy that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Developing a Knowledge Strategy can leverage the sales team experience to cultivate customer relationships as Knowledge Explicitly is planning to shift buying processes online.
High cash cycle compare to competitors
Knowledge Explicitly 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Developing a Knowledge Strategy, it seems that the employees of Knowledge Explicitly 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Developing a Knowledge Strategy 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 Knowledge Explicitly has relatively successful track record of launching new products.
Increasing silos among functional specialists
– The organizational structure of Knowledge Explicitly is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Knowledge Explicitly needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Knowledge Explicitly to focus more on services rather than just following the product oriented approach.
Lack of clear differentiation of Knowledge Explicitly products
– To increase the profitability and margins on the products, Knowledge Explicitly needs to provide more differentiated products than what it is currently offering in the marketplace.
Skills based hiring
– The stress on hiring functional specialists at Knowledge Explicitly 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.
Opportunities Developing a Knowledge Strategy | 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 Developing a Knowledge Strategy are -
Developing new processes and practices
– Knowledge Explicitly 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.
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. Knowledge Explicitly can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Manufacturing automation
– Knowledge Explicitly 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.
Creating value in data economy
– The success of analytics program of Knowledge Explicitly has opened avenues for new revenue streams for the organization in the industry. This can help Knowledge Explicitly to build a more holistic ecosystem as suggested in the Developing a Knowledge Strategy case study. Knowledge Explicitly can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at Knowledge Explicitly 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Knowledge Explicitly can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Learning at scale
– Online learning technologies has now opened space for Knowledge Explicitly 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.
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. Knowledge Explicitly can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Low interest rates
– Even though inflation is raising its head in most developed economies, Knowledge Explicitly 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.
Buying journey improvements
– Knowledge Explicitly can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Developing a Knowledge Strategy 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Knowledge Explicitly 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, Developing a Knowledge Strategy, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Better consumer reach
– The expansion of the 5G network will help Knowledge Explicitly to increase its market reach. Knowledge Explicitly 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Knowledge Explicitly can use these opportunities to build new business models that can help the communities that Knowledge Explicitly operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Threats Developing a Knowledge Strategy External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Developing a Knowledge Strategy are -
Shortening product life cycle
– it is one of the major threat that Knowledge Explicitly is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Knowledge Explicitly business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Knowledge Explicitly 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.
Regulatory challenges
– Knowledge Explicitly 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.
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 Knowledge Explicitly.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Knowledge Explicitly 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, Knowledge Explicitly 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 Developing a Knowledge Strategy .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Knowledge Explicitly 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.
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. Knowledge Explicitly can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing wage structure of Knowledge Explicitly
– 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 Knowledge Explicitly.
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. Knowledge Explicitly 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.
Technology acceleration in Forth Industrial Revolution
– Knowledge Explicitly has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Knowledge Explicitly needs to keep up with the evolution of technology in the Strategy & Execution sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
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. Knowledge Explicitly needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Weighted SWOT Analysis of Developing a Knowledge Strategy 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 Developing a Knowledge Strategy 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 Developing a Knowledge Strategy 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 Developing a Knowledge Strategy 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 Developing a Knowledge Strategy 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 Knowledge Explicitly needs to make to build a sustainable competitive advantage.
