Novell: World's Largest Network Software Company SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study SWOT Analysis Solution
Case Study Description of Novell: World's Largest Network Software Company
After phenomenal growth and market leadership in networking, founder and CEO Ray Noorda made a frontal assault on Microsoft's core strengths. In 1994, Noorda spend over $1.5 billion acquiring companies such as WordPerfect to combat Microsoft Word, products such as Borland's Quattro Pro to combat Microsoft Excel, and a PC operating system to combat Microsoft MS-DOS. Novell's stock reached a high of $35 1/4 in March 1993 before beginning to slide downward as head-to-head competition with Microsoft was seen as a questionable strategy. Robert Frankenberg, an executive at Hewlett-Packard brought in to replace Ray Noorda, reversed course and sold many of the acquired companies. But time was running out for Novell. Microsoft had not only already won the head-to-head competition, but had mounted a counterattack with its NT server product that was fast eroding Novell's stronghold in Network Operating Systems (NOSs). Coming from an only 2 percent market share in 1993, by 1997 Microsoft's NT Server operating license unit sales were 997 million growing at 36 percent, compared to Novell's NetWare server operating license unit sales of 744 million growing at 13 percent. In early 1997, Novell's stock price had dropped to $7.
Swot Analysis of "Novell: World's Largest Network Software Company" written by Richard L. Nolan includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Novell's Noorda facing as an external strategic factors. Some of the topics covered in Novell: World's Largest Network Software Company case study are - Strategic Management Strategies, Internet, IT, Strategic planning and Technology & Operations.
Some of the macro environment factors that can be used to understand the Novell: World's Largest Network Software Company casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, banking and financial system is disrupted by Bitcoin and other crypto currencies, central banks are concerned over increasing inflation, increasing transportation and logistics costs, technology disruption, supply chains are disrupted by pandemic , increasing inequality as vast percentage of new income is going to the top 1%,
increasing household debt because of falling income levels, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Novell: World's Largest Network Software Company
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Novell: World's Largest Network Software Company case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Novell's Noorda, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Novell's Noorda 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 Novell: World's Largest Network Software Company can be done for the following purposes –
1. Strategic planning using facts provided in Novell: World's Largest Network Software Company case study
2. Improving business portfolio management of Novell's Noorda
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 Novell's Noorda
Strengths Novell: World's Largest Network Software Company | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Novell's Noorda in Novell: World's Largest Network Software Company Harvard Business Review case study are -
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Novell's Noorda digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Novell's Noorda 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
– Novell's Noorda 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 Novell: World's Largest Network Software Company 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
– Novell's Noorda has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Novell's Noorda 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.
Low bargaining power of suppliers
– Suppliers of Novell's Noorda in the sector have low bargaining power. Novell: World's Largest Network Software Company has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Novell's Noorda to manage not only supply disruptions but also source products at highly competitive prices.
Organizational Resilience of Novell's Noorda
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Novell's Noorda does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Analytics focus
– Novell's Noorda 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 Richard L. Nolan 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.
Strong track record of project management
– Novell's Noorda is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Cross disciplinary teams
– Horizontal connected teams at the Novell's Noorda 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.
Superior customer experience
– The customer experience strategy of Novell's Noorda in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High switching costs
– The high switching costs that Novell's Noorda 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.
Operational resilience
– The operational resilience strategy in the Novell: World's Largest Network Software Company 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.
Ability to lead change in Technology & Operations field
– Novell's Noorda 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 Novell's Noorda in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Weaknesses Novell: World's Largest Network Software Company | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Novell: World's Largest Network Software Company are -
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 Novell's Noorda supply chain. Even after few cautionary changes mentioned in the HBR case study - Novell: World's Largest Network Software Company, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Novell's Noorda vulnerable to further global disruptions in South East Asia.
Skills based hiring
– The stress on hiring functional specialists at Novell's Noorda 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.
Need for greater diversity
– Novell's Noorda 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 operating costs
– Compare to the competitors, firm in the HBR case study Novell: World's Largest Network Software Company 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 Novell's Noorda 's lucrative customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Novell's Noorda 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.
High cash cycle compare to competitors
Novell's Noorda 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.
Aligning sales with marketing
– It come across in the case study Novell: World's Largest Network Software Company 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 Novell: World's Largest Network Software Company can leverage the sales team experience to cultivate customer relationships as Novell's Noorda is planning to shift buying processes online.
No frontier risks strategy
– After analyzing the HBR case study Novell: World's Largest Network Software Company, it seems that company is thinking about the frontier risks that can impact Technology & Operations strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Novell: World's Largest Network Software Company, is just above the industry average. Novell's Noorda 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 Novell: World's Largest Network Software Company 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 Novell's Noorda has relatively successful track record of launching new products.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Novell's Noorda is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Novell: World's Largest Network Software Company can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities Novell: World's Largest Network Software Company | 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 Novell: World's Largest Network Software Company are -
Creating value in data economy
– The success of analytics program of Novell's Noorda has opened avenues for new revenue streams for the organization in the industry. This can help Novell's Noorda to build a more holistic ecosystem as suggested in the Novell: World's Largest Network Software Company case study. Novell's Noorda can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Novell's Noorda 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.
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. Novell's Noorda can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Leveraging digital technologies
– Novell's Noorda 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Novell's Noorda is facing challenges because of the dominance of functional experts in the organization. Novell: World's Largest Network Software Company 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.
Using analytics as competitive advantage
– Novell's Noorda 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 Novell: World's Largest Network Software Company - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Novell's Noorda to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Novell's Noorda can use these opportunities to build new business models that can help the communities that Novell's Noorda operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Buying journey improvements
– Novell's Noorda can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Novell: World's Largest Network Software Company 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Novell's Noorda 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 Novell's Noorda to hire the very best people irrespective of their geographical location.
Learning at scale
– Online learning technologies has now opened space for Novell's Noorda 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.
Loyalty marketing
– Novell's Noorda 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.
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. Novell's Noorda 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. Novell's Noorda 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.
Manufacturing automation
– Novell's Noorda 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.
Threats Novell: World's Largest Network Software Company External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Novell: World's Largest Network Software Company are -
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. Novell's Noorda can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Novell's Noorda 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Novell: World's Largest Network Software Company, Novell's Noorda 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 .
Shortening product life cycle
– it is one of the major threat that Novell's Noorda is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Technology acceleration in Forth Industrial Revolution
– Novell's Noorda has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Novell's Noorda 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.
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. Novell's Noorda needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
Regulatory challenges
– Novell's Noorda 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.
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 Novell's Noorda in the Technology & Operations sector and impact the bottomline 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 Novell's Noorda.
Consumer confidence and its impact on Novell's Noorda 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.
Increasing wage structure of Novell's Noorda
– 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 Novell's Noorda.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Novell's Noorda in the Technology & Operations industry. The Technology & Operations 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.
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 Novell's Noorda business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of Novell: World's Largest Network Software Company 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 Novell: World's Largest Network Software Company 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 Novell: World's Largest Network Software Company 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 Novell: World's Largest Network Software Company 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 Novell: World's Largest Network Software Company 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 Novell's Noorda needs to make to build a sustainable competitive advantage.
