Carrot or Stick? Getting Paid for Innovation at Tessera Technologies SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study Description of Carrot or Stick? Getting Paid for Innovation at Tessera Technologies
To maximize their effectiveness, color cases should be printed in color.Tessera Technologies has been very successful developing technologies for the semiconductor and mobile device industry, and then licensing them broadly to manufacturers. In addition to licensing patents, it also supplies know-how to help manufacturers move into high volume production. But the changing environment for patent enforcement, in particular the use of injunctions post eBay v. MercExchange, has brought new challenges to the company's licensing model. "Patent holdouts," companies who chose to litigate rather than license, created pressure from existing licensees. Further, as the company advanced one of its newest technology developments, a cooling technology for portable devices, it had to contend with markets where there were not strong property rights regimes. Would the company be able to get paid for its innovations, or was its model doomed?
Swot Analysis of "Carrot or Stick? Getting Paid for Innovation at Tessera Technologies" written by Willy Shih includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Licensing Technologies facing as an external strategic factors. Some of the topics covered in Carrot or Stick? Getting Paid for Innovation at Tessera Technologies case study are - Strategic Management Strategies, Intellectual property, Technology and Technology & Operations.
Some of the macro environment factors that can be used to understand the Carrot or Stick? Getting Paid for Innovation at Tessera Technologies casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, technology disruption, wage bills are increasing, talent flight as more people leaving formal jobs, increasing energy prices, increasing commodity prices, digital marketing is dominated by two big players Facebook and Google,
competitive advantages are harder to sustain because of technology dispersion, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of Carrot or Stick? Getting Paid for Innovation at Tessera Technologies
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Carrot or Stick? Getting Paid for Innovation at Tessera Technologies case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Licensing Technologies, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Licensing Technologies 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 Carrot or Stick? Getting Paid for Innovation at Tessera Technologies can be done for the following purposes –
1. Strategic planning using facts provided in Carrot or Stick? Getting Paid for Innovation at Tessera Technologies case study
2. Improving business portfolio management of Licensing Technologies
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 Licensing Technologies
Strengths Carrot or Stick? Getting Paid for Innovation at Tessera Technologies | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Licensing Technologies in Carrot or Stick? Getting Paid for Innovation at Tessera Technologies Harvard Business Review case study are -
Strong track record of project management
– Licensing Technologies is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to recruit top talent
– Licensing Technologies is one of the leading recruiters in the industry. Managers in the Carrot or Stick? Getting Paid for Innovation at Tessera Technologies are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Diverse revenue streams
– Licensing Technologies is present in almost all the verticals within the industry. This has provided firm in Carrot or Stick? Getting Paid for Innovation at Tessera Technologies 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
- Licensing Technologies 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 Licensing Technologies is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Carrot or Stick? Getting Paid for Innovation at Tessera Technologies Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Effective Research and Development (R&D)
– Licensing Technologies has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Carrot or Stick? Getting Paid for Innovation at Tessera Technologies - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Organizational Resilience of Licensing Technologies
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Licensing Technologies does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High switching costs
– The high switching costs that Licensing Technologies 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
– Licensing Technologies has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Carrot or Stick? Getting Paid for Innovation at Tessera Technologies 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.
Analytics focus
– Licensing Technologies 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 Willy Shih 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.
Innovation driven organization
– Licensing Technologies is one of the most innovative firm in sector. Manager in Carrot or Stick? Getting Paid for Innovation at Tessera Technologies 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 Licensing Technologies digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Licensing Technologies 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.
Superior customer experience
– The customer experience strategy of Licensing Technologies in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses Carrot or Stick? Getting Paid for Innovation at Tessera Technologies | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Carrot or Stick? Getting Paid for Innovation at Tessera Technologies are -
High bargaining power of channel partners
– Because of the regulatory requirements, Willy Shih suggests that, Licensing Technologies 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.
Increasing silos among functional specialists
– The organizational structure of Licensing Technologies is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Licensing Technologies needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Licensing Technologies to focus more on services rather than just following the product oriented approach.
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 Licensing Technologies supply chain. Even after few cautionary changes mentioned in the HBR case study - Carrot or Stick? Getting Paid for Innovation at Tessera Technologies, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Licensing Technologies vulnerable to further global disruptions in South East Asia.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Carrot or Stick? Getting Paid for Innovation at Tessera Technologies, in the dynamic environment Licensing Technologies has struggled to respond to the nimble upstart competition. Licensing Technologies has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High cash cycle compare to competitors
Licensing Technologies 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Carrot or Stick? Getting Paid for Innovation at Tessera Technologies, is just above the industry average. Licensing Technologies 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Licensing Technologies 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.
Need for greater diversity
– Licensing Technologies 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.
Products dominated business model
– Even though Licensing Technologies 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 - Carrot or Stick? Getting Paid for Innovation at Tessera Technologies should strive to include more intangible value offerings along with its core products and services.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Carrot or Stick? Getting Paid for Innovation at Tessera Technologies 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 Licensing Technologies has relatively successful track record of launching new products.
No frontier risks strategy
– After analyzing the HBR case study Carrot or Stick? Getting Paid for Innovation at Tessera Technologies, 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.
Opportunities Carrot or Stick? Getting Paid for Innovation at Tessera Technologies | 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 Carrot or Stick? Getting Paid for Innovation at Tessera Technologies are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Licensing Technologies 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 Licensing Technologies to hire the very best people irrespective of their geographical location.
Creating value in data economy
– The success of analytics program of Licensing Technologies has opened avenues for new revenue streams for the organization in the industry. This can help Licensing Technologies to build a more holistic ecosystem as suggested in the Carrot or Stick? Getting Paid for Innovation at Tessera Technologies case study. Licensing Technologies 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 Licensing Technologies 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.
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. Licensing Technologies 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. Licensing Technologies 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.
Better consumer reach
– The expansion of the 5G network will help Licensing Technologies to increase its market reach. Licensing Technologies 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Licensing Technologies 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.
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. Licensing Technologies can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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. Licensing Technologies can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Licensing Technologies can use these opportunities to build new business models that can help the communities that Licensing Technologies operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Licensing Technologies can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Licensing Technologies in the consumer business. Now Licensing Technologies can target international markets with far fewer capital restrictions requirements than the existing system.
Developing new processes and practices
– Licensing Technologies 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.
Leveraging digital technologies
– Licensing Technologies 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.
Threats Carrot or Stick? Getting Paid for Innovation at Tessera Technologies External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Carrot or Stick? Getting Paid for Innovation at Tessera Technologies are -
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.
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. Licensing Technologies 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Licensing Technologies with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Licensing Technologies needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
Stagnating economy with rate increase
– Licensing Technologies 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Licensing Technologies 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.
Regulatory challenges
– Licensing Technologies 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 Licensing Technologies in the Technology & Operations sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– Licensing Technologies has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Licensing Technologies 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Licensing Technologies 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 Carrot or Stick? Getting Paid for Innovation at Tessera Technologies .
Shortening product life cycle
– it is one of the major threat that Licensing Technologies is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
High dependence on third party suppliers
– Licensing Technologies 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.
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 Carrot or Stick? Getting Paid for Innovation at Tessera Technologies 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 Carrot or Stick? Getting Paid for Innovation at Tessera Technologies 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 Carrot or Stick? Getting Paid for Innovation at Tessera Technologies 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 Carrot or Stick? Getting Paid for Innovation at Tessera Technologies 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 Carrot or Stick? Getting Paid for Innovation at Tessera Technologies 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 Licensing Technologies needs to make to build a sustainable competitive advantage.