Swot Analysis of "Managing Business Risk of Information Technology" written by Robert D. Austin, Richard L. Nolan includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Risk Presentations facing as an external strategic factors. Some of the topics covered in Managing Business Risk of Information Technology case study are - Strategic Management Strategies, IT, Risk management and Technology & Operations.
Some of the macro environment factors that can be used to understand the Managing Business Risk of Information Technology casestudy better are - – competitive advantages are harder to sustain because of technology dispersion, increasing inequality as vast percentage of new income is going to the top 1%, supply chains are disrupted by pandemic , digital marketing is dominated by two big players Facebook and Google, there is increasing trade war between United States & China, customer relationship management is fast transforming because of increasing concerns over data privacy, wage bills are increasing,
geopolitical disruptions, increasing energy prices, etc
Introduction to SWOT Analysis of Managing Business Risk of Information Technology
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Managing Business Risk of Information Technology case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Risk Presentations, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Risk Presentations 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 Managing Business Risk of Information Technology can be done for the following purposes –
1. Strategic planning using facts provided in Managing Business Risk of Information Technology case study
2. Improving business portfolio management of Risk Presentations
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 Risk Presentations
Strengths Managing Business Risk of Information Technology | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Risk Presentations in Managing Business Risk of Information Technology Harvard Business Review case study are -
Organizational Resilience of Risk Presentations
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Risk Presentations does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Low bargaining power of suppliers
– Suppliers of Risk Presentations in the sector have low bargaining power. Managing Business Risk of Information Technology has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Risk Presentations to manage not only supply disruptions but also source products at highly competitive prices.
Ability to recruit top talent
– Risk Presentations is one of the leading recruiters in the industry. Managers in the Managing Business Risk of Information Technology are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Operational resilience
– The operational resilience strategy in the Managing Business Risk of Information Technology 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.
High switching costs
– The high switching costs that Risk Presentations 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
– Risk Presentations has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Managing Business Risk of Information Technology 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.
High brand equity
– Risk Presentations has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Risk Presentations to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Learning organization
- Risk Presentations 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 Risk Presentations is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Managing Business Risk of Information Technology Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– Risk Presentations is one of the most innovative firm in sector. Manager in Managing Business Risk of Information Technology Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Risk Presentations digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Risk Presentations 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.
Sustainable margins compare to other players in Technology & Operations industry
– Managing Business Risk of Information Technology firm has clearly differentiated products in the market place. This has enabled Risk Presentations to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Risk Presentations to invest into research and development (R&D) and innovation.
Successful track record of launching new products
– Risk Presentations has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Risk Presentations 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.
Weaknesses Managing Business Risk of Information Technology | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Managing Business Risk of Information Technology are -
High operating costs
– Compare to the competitors, firm in the HBR case study Managing Business Risk of Information Technology 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 Risk Presentations 's lucrative customers.
Skills based hiring
– The stress on hiring functional specialists at Risk Presentations 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.
Low market penetration in new markets
– Outside its home market of Risk Presentations, firm in the HBR case study Managing Business Risk of Information Technology needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Lack of clear differentiation of Risk Presentations products
– To increase the profitability and margins on the products, Risk Presentations needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Risk Presentations is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Managing Business Risk of Information Technology can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Slow to strategic competitive environment developments
– As Managing Business Risk of Information Technology HBR case study mentions - Risk Presentations 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Managing Business Risk of Information Technology, is just above the industry average. Risk Presentations 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.
Aligning sales with marketing
– It come across in the case study Managing Business Risk of Information Technology 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 Managing Business Risk of Information Technology can leverage the sales team experience to cultivate customer relationships as Risk Presentations is planning to shift buying processes online.
High cash cycle compare to competitors
Risk Presentations 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.
Capital Spending Reduction
– Even during the low interest decade, Risk Presentations has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
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 Risk Presentations supply chain. Even after few cautionary changes mentioned in the HBR case study - Managing Business Risk of Information Technology, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Risk Presentations vulnerable to further global disruptions in South East Asia.
Opportunities Managing Business Risk of Information Technology | 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 Managing Business Risk of Information Technology are -
Buying journey improvements
– Risk Presentations can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Managing Business Risk of Information Technology suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Creating value in data economy
– The success of analytics program of Risk Presentations has opened avenues for new revenue streams for the organization in the industry. This can help Risk Presentations to build a more holistic ecosystem as suggested in the Managing Business Risk of Information Technology case study. Risk Presentations can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at Risk Presentations 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Risk Presentations 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Risk Presentations 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Risk Presentations is facing challenges because of the dominance of functional experts in the organization. Managing Business Risk of Information Technology 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.
Loyalty marketing
– Risk Presentations 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.
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. Risk Presentations can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Risk Presentations 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 Risk Presentations to hire the very best people irrespective of their geographical location.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Risk Presentations can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Manufacturing automation
– Risk Presentations 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.
Leveraging digital technologies
– Risk Presentations 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.
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 Risk Presentations in the consumer business. Now Risk Presentations can target international markets with far fewer capital restrictions requirements than the existing system.
Threats Managing Business Risk of Information Technology External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Managing Business Risk of Information Technology are -
Technology acceleration in Forth Industrial Revolution
– Risk Presentations has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Risk Presentations 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.
Stagnating economy with rate increase
– Risk Presentations 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.
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 Risk Presentations in the Technology & Operations sector and impact the bottomline of the organization.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Risk Presentations 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 Risk Presentations business can come under increasing regulations regarding data privacy, data security, etc.
Environmental challenges
– Risk Presentations 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. Risk Presentations can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Risk Presentations can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Managing Business Risk of Information Technology .
Regulatory challenges
– Risk Presentations 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 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. Risk Presentations needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
Consumer confidence and its impact on Risk Presentations 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
– Risk Presentations 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.
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. Risk Presentations can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
Weighted SWOT Analysis of Managing Business Risk of Information Technology 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 Managing Business Risk of Information Technology 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 Managing Business Risk of Information Technology 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 Managing Business Risk of Information Technology 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 Managing Business Risk of Information Technology 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 Risk Presentations needs to make to build a sustainable competitive advantage.