An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study Description of An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise
There is a dearth of research on the capabilities of innovative small-to-medium software enterprises (SMSEs). Understanding how SMSEs build and apply business and information systems (IS) capabilities is important, as such firms account for over 90% of software enterprises operating in Europe and the US. This paper elaborates and applies dynamic capability theory to explore and help understand the web of conditions and factors that shaped and influenced business and IS capability development and application in one European SMSE. Drawing on the overarching theory of dynamic capabilities, a theoretical model is presented that posits relationships among (1) a firm's past activities; (2) its integration, learning and reconfiguration, and transformation capabilities; (3) its financial, complementary, locational, and technological asset positions; and (4) the products and services that result, and which are of value to an SMSE's customers. The paper refines and elaborates the model by describing and enumerating the business and IS capabilities, assets, and products and services of the SMSE under study. To properly assess whether this firm's products and services were of value to its customers, research was also conducted at two customer sites in Ireland and the US, in addition to the investigation at the primary research site in Dublin. The study therefore informs both practitioners' and researchers' understandings of this complex and under-researched phenomenon: for practitioners, it highlights the characteristics required to build innovative software solutions; for researchers, it illustrates the patterns and regularities associated with the development and application of business and IS capabilities.
Swot Analysis of "An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise" written by Tom Butler, Ciaran Murphy includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Capabilities Smse facing as an external strategic factors. Some of the topics covered in An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise case study are - Strategic Management Strategies, and Technology & Operations.
Some of the macro environment factors that can be used to understand the An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise casestudy better are - – increasing energy prices, digital marketing is dominated by two big players Facebook and Google, increasing inequality as vast percentage of new income is going to the top 1%, increasing commodity prices, supply chains are disrupted by pandemic , geopolitical disruptions, cloud computing is disrupting traditional business models,
talent flight as more people leaving formal jobs, there is backlash against globalization, etc
Introduction to SWOT Analysis of An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Capabilities Smse, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Capabilities Smse 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 An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise can be done for the following purposes –
1. Strategic planning using facts provided in An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise case study
2. Improving business portfolio management of Capabilities Smse
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 Capabilities Smse
Strengths An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Capabilities Smse in An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise Harvard Business Review case study are -
High switching costs
– The high switching costs that Capabilities Smse 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.
Successful track record of launching new products
– Capabilities Smse has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Capabilities Smse 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.
High brand equity
– Capabilities Smse has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Capabilities Smse to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Superior customer experience
– The customer experience strategy of Capabilities Smse in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to recruit top talent
– Capabilities Smse is one of the leading recruiters in the industry. Managers in the An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Analytics focus
– Capabilities Smse 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 Tom Butler, Ciaran Murphy 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.
Learning organization
- Capabilities Smse 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 Capabilities Smse is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– Capabilities Smse is one of the most innovative firm in sector. Manager in An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise 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 Capabilities Smse digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Capabilities Smse 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
– An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise firm has clearly differentiated products in the market place. This has enabled Capabilities Smse to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Capabilities Smse to invest into research and development (R&D) and innovation.
Low bargaining power of suppliers
– Suppliers of Capabilities Smse in the sector have low bargaining power. An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Capabilities Smse to manage not only supply disruptions but also source products at highly competitive prices.
Strong track record of project management
– Capabilities Smse is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise are -
Interest costs
– Compare to the competition, Capabilities Smse has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Capital Spending Reduction
– Even during the low interest decade, Capabilities Smse 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise, is just above the industry average. Capabilities Smse 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.
Need for greater diversity
– Capabilities Smse 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.
Slow decision making process
– As mentioned earlier in the report, Capabilities Smse has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Capabilities Smse even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Workers concerns about automation
– As automation is fast increasing in the segment, Capabilities Smse 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.
Aligning sales with marketing
– It come across in the case study An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise 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 An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise can leverage the sales team experience to cultivate customer relationships as Capabilities Smse is planning to shift buying processes online.
Products dominated business model
– Even though Capabilities Smse 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 - An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise should strive to include more intangible value offerings along with its core products and services.
Slow to strategic competitive environment developments
– As An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise HBR case study mentions - Capabilities Smse 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.
Skills based hiring
– The stress on hiring functional specialists at Capabilities Smse 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise, it seems that the employees of Capabilities Smse 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.
Opportunities An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise | 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 An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise are -
Better consumer reach
– The expansion of the 5G network will help Capabilities Smse to increase its market reach. Capabilities Smse 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Capabilities Smse is facing challenges because of the dominance of functional experts in the organization. An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise 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.
Developing new processes and practices
– Capabilities Smse 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Capabilities Smse can use these opportunities to build new business models that can help the communities that Capabilities Smse 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 Capabilities Smse can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Learning at scale
– Online learning technologies has now opened space for Capabilities Smse 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Capabilities Smse 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. Capabilities Smse 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
– Capabilities Smse 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Capabilities Smse can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Capabilities Smse 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. Capabilities Smse 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.
Creating value in data economy
– The success of analytics program of Capabilities Smse has opened avenues for new revenue streams for the organization in the industry. This can help Capabilities Smse to build a more holistic ecosystem as suggested in the An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise case study. Capabilities Smse can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Loyalty marketing
– Capabilities Smse 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.
Threats An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise are -
Shortening product life cycle
– it is one of the major threat that Capabilities Smse is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Capabilities Smse 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 An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise .
Environmental challenges
– Capabilities Smse 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. Capabilities Smse can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
Stagnating economy with rate increase
– Capabilities Smse 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.
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. Capabilities Smse needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
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 Capabilities Smse
– 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 Capabilities Smse.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Capabilities Smse with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Regulatory challenges
– Capabilities Smse 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Capabilities Smse 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.
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 Capabilities Smse.
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 Capabilities Smse business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise 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 An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise 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 An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise 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 An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise 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 An Exploratory Study on IS Capabilities and Assets in a Small-to-Medium Software Enterprise 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 Capabilities Smse needs to make to build a sustainable competitive advantage.
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