Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

Case Study SWOT Analysis Solution

Case Study Description of Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes

Pearson Plc is an education company that operates worldwide and is headquartered in London, the United Kingdom. Its six primary business units are North American Education, International Education, Professional, the Financial Times, Interactive Data, and Penguin Publishing. The vice-president of product management within the Digital Learning division of the North American Education unit based in Chandler, Arizona begins to transform the product development processes to better meet the needs of his customers in the education market, specifically in transitioning from using an off-shored waterfall software development model to an on-shore Agile model. When the vice-president first joined Pearson a year earlier, the Digital Learning unit had spent significant resources developing a major upgrade to one of its educational software products. The first version of this new product was challenged by the disconnect between what the software development group was delivering and what the vice-president's customers desired. He is faced with a decision to continue focusing on the specific methodology they had implemented (Scrum) or move to a new one (Kanban). Additionally, he has to consider expanding his focus to help drive Agile methodologies both with other groups in his business unit and outside his business unit. These decisions must be made at a potentially critical time for his products as his organization deals with the growing pains associated with the shift to Agile.

Authors :: T.S. Raghu, Collin Sellman

Topics :: Technology & Operations

Tags :: IT, Marketing, Operations management, Product development, SWOT Analysis, SWOT Matrix, TOWS, Weighted SWOT Analysis

Swot Analysis of "Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes" written by T.S. Raghu, Collin Sellman includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Education Agile facing as an external strategic factors. Some of the topics covered in Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes case study are - Strategic Management Strategies, IT, Marketing, Operations management, Product development and Technology & Operations.

Some of the macro environment factors that can be used to understand the Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes casestudy better are - – there is increasing trade war between United States & China, increasing government debt because of Covid-19 spendings, talent flight as more people leaving formal jobs, wage bills are increasing, geopolitical disruptions, challanges to central banks by blockchain based private currencies, increasing transportation and logistics costs, technology disruption, supply chains are disrupted by pandemic , etc

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Introduction to SWOT Analysis of Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Education Agile, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Education Agile 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes can be done for the following purposes –
1. Strategic planning using facts provided in Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes case study
2. Improving business portfolio management of Education Agile
3. Assessing feasibility of the new initiative in Technology & Operations field.
4. Making a Technology & Operations topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Education Agile

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Strengths Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Education Agile in Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes Harvard Business Review case study are -

Highly skilled collaborators

– Education Agile 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 Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.

High switching costs

– The high switching costs that Education Agile 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

– Education Agile has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes 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 Technology & Operations field

– Education Agile 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 Education Agile in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

Cross disciplinary teams

– Horizontal connected teams at the Education Agile 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.

Low bargaining power of suppliers

– Suppliers of Education Agile in the sector have low bargaining power. Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Education Agile to manage not only supply disruptions but also source products at highly competitive prices.

High brand equity

– Education Agile has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Education Agile to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Digital Transformation in Technology & Operations segment

- digital transformation varies from industry to industry. For Education Agile digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Education Agile 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.

Analytics focus

– Education Agile 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 T.S. Raghu, Collin Sellman can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.

Sustainable margins compare to other players in Technology & Operations industry

– Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes firm has clearly differentiated products in the market place. This has enabled Education Agile to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Education Agile to invest into research and development (R&D) and innovation.

Diverse revenue streams

– Education Agile is present in almost all the verticals within the industry. This has provided firm in Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes 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.

Learning organization

- Education Agile 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 Education Agile is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes Harvard Business Review case study emphasize – knowledge, initiative, and innovation.

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Weaknesses Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes are -

High dependence on star products

– The top 2 products and services of the firm as mentioned in the Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes 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 Education Agile has relatively successful track record of launching new products.

Lack of clear differentiation of Education Agile products

– To increase the profitability and margins on the products, Education Agile needs to provide more differentiated products than what it is currently offering in the marketplace.

Ability to respond to the competition

– As the decision making is very deliberative, highlighted in the case study Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes, in the dynamic environment Education Agile has struggled to respond to the nimble upstart competition. Education Agile has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

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 Education Agile supply chain. Even after few cautionary changes mentioned in the HBR case study - Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Education Agile vulnerable to further global disruptions in South East Asia.

Slow to strategic competitive environment developments

– As Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes HBR case study mentions - Education Agile 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.

Interest costs

– Compare to the competition, Education Agile 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.

Employees’ incomplete understanding of strategy

– From the instances in the HBR case study Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes, it seems that the employees of Education Agile 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 cash cycle compare to competitors

Education Agile 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.

Skills based hiring

– The stress on hiring functional specialists at Education Agile 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.

Aligning sales with marketing

– It come across in the case study Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes 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 Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes can leverage the sales team experience to cultivate customer relationships as Education Agile is planning to shift buying processes online.

Products dominated business model

– Even though Education Agile 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 - Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes should strive to include more intangible value offerings along with its core products and services.

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Opportunities Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes | 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 Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes are -

Changes in consumer behavior post Covid-19

– Consumer behavior has changed in the Technology & Operations industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Education Agile 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. Education Agile 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.

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. Education Agile can explore opportunities that can attract volunteers and are consistent with its mission and vision.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Education Agile 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 Education Agile to hire the very best people irrespective of their geographical location.

Buying journey improvements

– Education Agile can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes 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.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Education Agile can use these opportunities to build new business models that can help the communities that Education Agile operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.

Better consumer reach

– The expansion of the 5G network will help Education Agile to increase its market reach. Education Agile 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.

Learning at scale

– Online learning technologies has now opened space for Education Agile 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.

Low interest rates

– Even though inflation is raising its head in most developed economies, Education Agile 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.

Lowering marketing communication costs

– 5G expansion will open new opportunities for Education Agile in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Technology & Operations segment, and it will provide faster access to the consumers.

Developing new processes and practices

– Education Agile can develop new processes and procedures in Technology & Operations 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 Education Agile 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 Technology & Operations segment.

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 Education Agile in the consumer business. Now Education Agile can target international markets with far fewer capital restrictions requirements than the existing system.

Redefining models of collaboration and team work

– As explained in the weaknesses section, Education Agile is facing challenges because of the dominance of functional experts in the organization. Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes 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.

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Threats Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats mentioned in the HBR case study Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes are -

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 Education Agile.

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.

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes, Education Agile may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Technology & Operations .

High dependence on third party suppliers

– Education Agile 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.

Stagnating economy with rate increase

– Education Agile 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.

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. Education Agile 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.

Environmental challenges

– Education Agile 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. Education Agile can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.

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.

Regulatory challenges

– Education Agile 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 Technology & Operations industry regulations.

Increasing wage structure of Education Agile

– 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 Education Agile.

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 Education Agile in the Technology & Operations sector and impact the bottomline of the organization.

Technology acceleration in Forth Industrial Revolution

– Education Agile has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Education Agile needs to keep up with the evolution of technology in the Technology & Operations 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.

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 Education Agile business can come under increasing regulations regarding data privacy, data security, etc.

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Weighted SWOT Analysis of Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes 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 Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes 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 Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes 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 Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes 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 Pearson's Successmaker: Putting the Customer First in Transforming Product Development Processes 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 Education Agile needs to make to build a sustainable competitive advantage.

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