Market Segmentation Strategies and Service Sector Productivity SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Market Segmentation Strategies and Service Sector Productivity
Conventional explanations for lagging U.S. service sector productivity focus on the difficulties of measuring service output, a lack of sufficient competition in service industries, and poor management skills. Drawing on data collected in 95 service establishments in the banking and hotel industries in the United States, United Kingdom, and Germany, this article suggests an alternative explanation. U.S. service companies may effectively be achieving low levels of labor productivity by design. The U.S. service establishments in this study are productivity leaders in low value-added market segments but productivity laggards in higher value-added market segments. They have consciously chosen to adjust the labor intensity of service delivery to the business potential of different customer segments. Varying the design of service processes by customer segment has lowered measured productivity levels but may be supporting higher levels of business performance.
Authors :: Brent Keltner, David Finegold, Geoff Mason, Karin Wagner
Swot Analysis of "Market Segmentation Strategies and Service Sector Productivity" written by Brent Keltner, David Finegold, Geoff Mason, Karin Wagner includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Productivity Service facing as an external strategic factors. Some of the topics covered in Market Segmentation Strategies and Service Sector Productivity case study are - Strategic Management Strategies, Productivity, Supply chain and Technology & Operations.
Some of the macro environment factors that can be used to understand the Market Segmentation Strategies and Service Sector Productivity casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, increasing transportation and logistics costs, cloud computing is disrupting traditional business models, supply chains are disrupted by pandemic , increasing household debt because of falling income levels, there is backlash against globalization, competitive advantages are harder to sustain because of technology dispersion,
digital marketing is dominated by two big players Facebook and Google, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Market Segmentation Strategies and Service Sector Productivity
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Market Segmentation Strategies and Service Sector Productivity case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Productivity Service, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Productivity Service 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 Market Segmentation Strategies and Service Sector Productivity can be done for the following purposes –
1. Strategic planning using facts provided in Market Segmentation Strategies and Service Sector Productivity case study
2. Improving business portfolio management of Productivity Service
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 Productivity Service
Strengths Market Segmentation Strategies and Service Sector Productivity | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Productivity Service in Market Segmentation Strategies and Service Sector Productivity Harvard Business Review case study are -
Ability to lead change in Technology & Operations field
– Productivity Service 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 Productivity Service in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Innovation driven organization
– Productivity Service is one of the most innovative firm in sector. Manager in Market Segmentation Strategies and Service Sector Productivity 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
– Productivity Service is one of the leading recruiters in the industry. Managers in the Market Segmentation Strategies and Service Sector Productivity are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Training and development
– Productivity Service has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Market Segmentation Strategies and Service Sector Productivity 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.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Productivity Service digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Productivity Service 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.
High brand equity
– Productivity Service has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Productivity Service to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Operational resilience
– The operational resilience strategy in the Market Segmentation Strategies and Service Sector Productivity Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Low bargaining power of suppliers
– Suppliers of Productivity Service in the sector have low bargaining power. Market Segmentation Strategies and Service Sector Productivity has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Productivity Service to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Productivity Service in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Productivity Service 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 Market Segmentation Strategies and Service Sector Productivity HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– Productivity Service has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Productivity Service 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 Technology & Operations industry
– Market Segmentation Strategies and Service Sector Productivity firm has clearly differentiated products in the market place. This has enabled Productivity Service to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Productivity Service to invest into research and development (R&D) and innovation.
Weaknesses Market Segmentation Strategies and Service Sector Productivity | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Market Segmentation Strategies and Service Sector Productivity are -
Workers concerns about automation
– As automation is fast increasing in the segment, Productivity Service 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Market Segmentation Strategies and Service Sector Productivity, is just above the industry average. Productivity Service 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Market Segmentation Strategies and Service Sector Productivity, it seems that the employees of Productivity Service 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 operating costs
– Compare to the competitors, firm in the HBR case study Market Segmentation Strategies and Service Sector Productivity 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 Productivity Service 's lucrative customers.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Market Segmentation Strategies and Service Sector Productivity 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 Productivity Service has relatively successful track record of launching new products.
Aligning sales with marketing
– It come across in the case study Market Segmentation Strategies and Service Sector Productivity 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 Market Segmentation Strategies and Service Sector Productivity can leverage the sales team experience to cultivate customer relationships as Productivity Service is planning to shift buying processes online.
Need for greater diversity
– Productivity Service 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Brent Keltner, David Finegold, Geoff Mason, Karin Wagner suggests that, Productivity Service 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Productivity Service is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Market Segmentation Strategies and Service Sector Productivity can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Low market penetration in new markets
– Outside its home market of Productivity Service, firm in the HBR case study Market Segmentation Strategies and Service Sector Productivity needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Skills based hiring
– The stress on hiring functional specialists at Productivity Service 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 Market Segmentation Strategies and Service Sector Productivity | 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 Market Segmentation Strategies and Service Sector Productivity 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 Productivity Service in the consumer business. Now Productivity Service can target international markets with far fewer capital restrictions requirements than the existing system.
Using analytics as competitive advantage
– Productivity Service has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Market Segmentation Strategies and Service Sector Productivity - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Productivity Service to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Productivity Service 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. Productivity Service 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.
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 Productivity Service 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.
Manufacturing automation
– Productivity Service can use the latest technology developments to improve its manufacturing and designing process in Technology & Operations 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Productivity Service is facing challenges because of the dominance of functional experts in the organization. Market Segmentation Strategies and Service Sector Productivity 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Productivity Service 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.
Developing new processes and practices
– Productivity Service 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.
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. Productivity Service 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 Productivity Service can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Technology & Operations industry, but it has also influenced the consumer preferences. Productivity Service can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Better consumer reach
– The expansion of the 5G network will help Productivity Service to increase its market reach. Productivity Service 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.
Building a culture of innovation
– managers at Productivity Service 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.
Threats Market Segmentation Strategies and Service Sector Productivity External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Market Segmentation Strategies and Service Sector Productivity are -
Regulatory challenges
– Productivity Service 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.
High dependence on third party suppliers
– Productivity Service 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.
Technology acceleration in Forth Industrial Revolution
– Productivity Service has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Productivity Service 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.
Easy access to finance
– Easy access to finance in Technology & Operations field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Productivity Service 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 Productivity Service business can come under increasing regulations regarding data privacy, data security, etc.
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.
Increasing wage structure of Productivity Service
– 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 Productivity Service.
Environmental challenges
– Productivity Service 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. Productivity Service can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Market Segmentation Strategies and Service Sector Productivity, Productivity Service 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 .
Stagnating economy with rate increase
– Productivity Service 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.
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.
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 Productivity Service.
Consumer confidence and its impact on Productivity Service 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.
Weighted SWOT Analysis of Market Segmentation Strategies and Service Sector Productivity 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 Market Segmentation Strategies and Service Sector Productivity 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 Market Segmentation Strategies and Service Sector Productivity 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 Market Segmentation Strategies and Service Sector Productivity 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 Market Segmentation Strategies and Service Sector Productivity 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 Productivity Service needs to make to build a sustainable competitive advantage.
