State Fair of Virginia SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of State Fair of Virginia
In November 2011, the State Fair of Virginia, Inc. (SFVA) was facing a dire financial situation. While SFVA was officially founded in 1906, the fair had been operating since 1854. SFVA was a privately held, not-for-profit organization that operated the state fair independent of the state government, and received no operating support from state or local governments. In 2003, the organization had borrowed $83 million against a $47 million investment portfolio in order to develop its new fairgrounds which opened in 2009. The new site had been attractive because it included The Meadow Farm, a horse farm famous for being the birthplace of the Secretariat, winner of the 1973 Triple Crown. The unprecedented collapse of the financial markets in the United States in 2008 combined with a poor economy and terrible weather for the fair's first two years, resulted in a situation where in late 2011, the organization did not bring in enough in income and donations to cover the loan payments. Creditors were demanding an immediate solution. The board of directors of SFVA realized that they had no choice but to consider strategic options including applying for Chapter 11 bankruptcy, which would give them time to try to restructure their debt, or shutting down immediately.
Swot Analysis of "State Fair of Virginia" written by W. Glenn Rowe, Karin Schnarr includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Sfva Fair facing as an external strategic factors. Some of the topics covered in State Fair of Virginia case study are - Strategic Management Strategies, Operations management, Risk management and Strategy & Execution.
Some of the macro environment factors that can be used to understand the State Fair of Virginia casestudy better are - – increasing transportation and logistics costs, there is backlash against globalization, geopolitical disruptions, increasing commodity prices, increasing government debt because of Covid-19 spendings, increasing energy prices, banking and financial system is disrupted by Bitcoin and other crypto currencies,
talent flight as more people leaving formal jobs, technology disruption, etc
Introduction to SWOT Analysis of State Fair of Virginia
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in State Fair of Virginia case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Sfva Fair, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Sfva Fair 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 State Fair of Virginia can be done for the following purposes –
1. Strategic planning using facts provided in State Fair of Virginia case study
2. Improving business portfolio management of Sfva Fair
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 Sfva Fair
Strengths State Fair of Virginia | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Sfva Fair in State Fair of Virginia Harvard Business Review case study are -
Learning organization
- Sfva Fair 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 Sfva Fair is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in State Fair of Virginia Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
High brand equity
– Sfva Fair has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Sfva Fair to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Successful track record of launching new products
– Sfva Fair has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Sfva Fair has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Sustainable margins compare to other players in Strategy & Execution industry
– State Fair of Virginia firm has clearly differentiated products in the market place. This has enabled Sfva Fair to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Sfva Fair to invest into research and development (R&D) and innovation.
Strong track record of project management
– Sfva Fair 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
– Sfva Fair is present in almost all the verticals within the industry. This has provided firm in State Fair of Virginia 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.
Ability to lead change in Strategy & Execution field
– Sfva Fair 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 Sfva Fair in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Sfva Fair digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Sfva Fair 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.
Cross disciplinary teams
– Horizontal connected teams at the Sfva Fair 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.
Highly skilled collaborators
– Sfva Fair 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 State Fair of Virginia HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Sfva Fair is one of the most innovative firm in sector. Manager in State Fair of Virginia Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Ability to recruit top talent
– Sfva Fair is one of the leading recruiters in the industry. Managers in the State Fair of Virginia are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Weaknesses State Fair of Virginia | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of State Fair of Virginia are -
Interest costs
– Compare to the competition, Sfva Fair 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.
Need for greater diversity
– Sfva Fair 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study State Fair of Virginia, in the dynamic environment Sfva Fair has struggled to respond to the nimble upstart competition. Sfva Fair has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Workers concerns about automation
– As automation is fast increasing in the segment, Sfva Fair 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Sfva Fair is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study State Fair of Virginia can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Increasing silos among functional specialists
– The organizational structure of Sfva Fair is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Sfva Fair needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Sfva Fair to focus more on services rather than just following the product oriented approach.
High operating costs
– Compare to the competitors, firm in the HBR case study State Fair of Virginia 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 Sfva Fair 's lucrative customers.
High bargaining power of channel partners
– Because of the regulatory requirements, W. Glenn Rowe, Karin Schnarr suggests that, Sfva Fair 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 State Fair of Virginia, is just above the industry average. Sfva Fair 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the State Fair of Virginia 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 Sfva Fair has relatively successful track record of launching new products.
High cash cycle compare to competitors
Sfva Fair 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.
Opportunities State Fair of Virginia | 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 State Fair of Virginia are -
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. Sfva Fair can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Sfva Fair can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Sfva Fair 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, State Fair of Virginia, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Learning at scale
– Online learning technologies has now opened space for Sfva Fair 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.
Buying journey improvements
– Sfva Fair can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. State Fair of Virginia 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.
Developing new processes and practices
– Sfva Fair 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.
Better consumer reach
– The expansion of the 5G network will help Sfva Fair to increase its market reach. Sfva Fair 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.
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. Sfva Fair 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. Sfva Fair 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.
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 Sfva Fair in the consumer business. Now Sfva Fair can target international markets with far fewer capital restrictions requirements than the existing system.
Low interest rates
– Even though inflation is raising its head in most developed economies, Sfva Fair 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 Sfva Fair 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.
Leveraging digital technologies
– Sfva Fair 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Sfva Fair can use these opportunities to build new business models that can help the communities that Sfva Fair operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Threats State Fair of Virginia External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study State Fair of Virginia are -
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 Sfva Fair in the Strategy & Execution sector and impact the bottomline of the organization.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Sfva Fair 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 Sfva Fair 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.
High dependence on third party suppliers
– Sfva Fair 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 State Fair of Virginia, Sfva Fair 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 .
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.
Environmental challenges
– Sfva Fair 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. Sfva Fair can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Increasing wage structure of Sfva Fair
– 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 Sfva Fair.
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. Sfva Fair will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Shortening product life cycle
– it is one of the major threat that Sfva Fair is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Technology acceleration in Forth Industrial Revolution
– Sfva Fair has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Sfva Fair 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.
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. Sfva Fair can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Sfva Fair business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of State Fair of Virginia 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 State Fair of Virginia 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 State Fair of Virginia 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 State Fair of Virginia 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 State Fair of Virginia 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 Sfva Fair needs to make to build a sustainable competitive advantage.
