Swot Analysis of "Riot Games: Can Culture Survive Growth?" written by Boris Groysberg, Michael Norris includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Riot Games facing as an external strategic factors. Some of the topics covered in Riot Games: Can Culture Survive Growth? case study are - Strategic Management Strategies, Strategy and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Riot Games: Can Culture Survive Growth? casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, increasing transportation and logistics costs, talent flight as more people leaving formal jobs, there is backlash against globalization, geopolitical disruptions, central banks are concerned over increasing inflation, technology disruption,
increasing government debt because of Covid-19 spendings, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of Riot Games: Can Culture Survive Growth?
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Riot Games: Can Culture Survive Growth? case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Riot Games, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Riot Games 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 Riot Games: Can Culture Survive Growth? can be done for the following purposes –
1. Strategic planning using facts provided in Riot Games: Can Culture Survive Growth? case study
2. Improving business portfolio management of Riot Games
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 Riot Games
Strengths Riot Games: Can Culture Survive Growth? | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Riot Games in Riot Games: Can Culture Survive Growth? Harvard Business Review case study are -
High brand equity
– Riot Games has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Riot Games to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in Strategy & Execution industry
– Riot Games: Can Culture Survive Growth? firm has clearly differentiated products in the market place. This has enabled Riot Games to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Riot Games to invest into research and development (R&D) and innovation.
Training and development
– Riot Games has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Riot Games: Can Culture Survive Growth? 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.
Ability to lead change in Strategy & Execution field
– Riot Games 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 Riot Games in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Ability to recruit top talent
– Riot Games is one of the leading recruiters in the industry. Managers in the Riot Games: Can Culture Survive Growth? are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Superior customer experience
– The customer experience strategy of Riot Games in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Organizational Resilience of Riot Games
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Riot Games does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High switching costs
– The high switching costs that Riot Games 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.
Diverse revenue streams
– Riot Games is present in almost all the verticals within the industry. This has provided firm in Riot Games: Can Culture Survive Growth? 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.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Riot Games digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Riot Games 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.
Highly skilled collaborators
– Riot Games 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 Riot Games: Can Culture Survive Growth? HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Low bargaining power of suppliers
– Suppliers of Riot Games in the sector have low bargaining power. Riot Games: Can Culture Survive Growth? has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Riot Games to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses Riot Games: Can Culture Survive Growth? | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Riot Games: Can Culture Survive Growth? are -
High operating costs
– Compare to the competitors, firm in the HBR case study Riot Games: Can Culture Survive Growth? 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 Riot Games 's lucrative customers.
Lack of clear differentiation of Riot Games products
– To increase the profitability and margins on the products, Riot Games 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, Riot Games is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Riot Games: Can Culture Survive Growth? can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Need for greater diversity
– Riot Games 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.
Slow decision making process
– As mentioned earlier in the report, Riot Games 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. Riot Games 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.
Aligning sales with marketing
– It come across in the case study Riot Games: Can Culture Survive Growth? 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 Riot Games: Can Culture Survive Growth? can leverage the sales team experience to cultivate customer relationships as Riot Games is planning to shift buying processes online.
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 Riot Games supply chain. Even after few cautionary changes mentioned in the HBR case study - Riot Games: Can Culture Survive Growth?, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Riot Games vulnerable to further global disruptions in South East Asia.
High cash cycle compare to competitors
Riot Games 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.
Increasing silos among functional specialists
– The organizational structure of Riot Games is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Riot Games needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Riot Games to focus more on services rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As Riot Games: Can Culture Survive Growth? HBR case study mentions - Riot Games 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.
Low market penetration in new markets
– Outside its home market of Riot Games, firm in the HBR case study Riot Games: Can Culture Survive Growth? needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Opportunities Riot Games: Can Culture Survive Growth? | 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 Riot Games: Can Culture Survive Growth? are -
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 Riot Games in the consumer business. Now Riot Games can target international markets with far fewer capital restrictions requirements than the existing system.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Riot Games 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.
Learning at scale
– Online learning technologies has now opened space for Riot Games 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Strategy & Execution industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Riot Games can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Riot Games can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Better consumer reach
– The expansion of the 5G network will help Riot Games to increase its market reach. Riot Games 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.
Buying journey improvements
– Riot Games can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Riot Games: Can Culture Survive Growth? 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.
Creating value in data economy
– The success of analytics program of Riot Games has opened avenues for new revenue streams for the organization in the industry. This can help Riot Games to build a more holistic ecosystem as suggested in the Riot Games: Can Culture Survive Growth? case study. Riot Games can build new products and services such as - data insight services, data privacy related products, data based consulting services, 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, Riot Games can use these opportunities to build new business models that can help the communities that Riot Games operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Loyalty marketing
– Riot Games 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Riot Games can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Developing new processes and practices
– Riot Games 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.
Building a culture of innovation
– managers at Riot Games 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Riot Games 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 Riot Games to hire the very best people irrespective of their geographical location.
Threats Riot Games: Can Culture Survive Growth? External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Riot Games: Can Culture Survive Growth? are -
Stagnating economy with rate increase
– Riot Games 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Riot Games 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 Riot Games: Can Culture Survive Growth? .
Technology acceleration in Forth Industrial Revolution
– Riot Games has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Riot Games 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.
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. Riot Games 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.
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 Riot Games business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Riot Games 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Riot Games: Can Culture Survive Growth?, Riot Games 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 .
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 Riot Games.
Regulatory challenges
– Riot Games 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.
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. Riot Games needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Riot Games 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.
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 Riot Games in the Strategy & Execution sector and impact the bottomline of the organization.
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. Riot Games can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of Riot Games: Can Culture Survive Growth? 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 Riot Games: Can Culture Survive Growth? 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 Riot Games: Can Culture Survive Growth? 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 Riot Games: Can Culture Survive Growth? 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 Riot Games: Can Culture Survive Growth? 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 Riot Games needs to make to build a sustainable competitive advantage.
