TSG Hoffenheim: Football in the Age of Analytics SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of TSG Hoffenheim: Football in the Age of Analytics
In 2015, Dietmar Hopp, owner of Germany's Bundesliga football team TSG Hoffenheim and co-founder of the global enterprise software company SAP, was considering how to ensure long-term sustainability and competitiveness for TSG Hoffenheim. While historically a small team from bottom rungs of the league, TSG Hoffenheim, with revenues of a??60 million to a??70 million, reached the top division of the Bundesliga in the 2008-2009 season thanks to a deliberate strategy focused on enhanced scouting, strong youth programs, and innovative technology and analytics that improved player development. In 2014 Hopp, who had personally invested a??300 million in the club, built a "footbonaut," an automated training environment that collected data on players' skills and strengths. The tool, one of three in the world, helped scouts and coaches better assess and develop each player. Yet some managers felt the technology was a distraction, an investment too expensive for a team that was not yet cash-flow positive. The team finished the 2014-2015 season in eighth place, below the top division, and Hopp wondered whether the focus on technology and analytics was the right strategy to grow the club. He wondered if the "moneyball" approach-when a smaller team competed with wealthier teams by using statistical analysis to buy undervalued assets and sell overvalued assets-could work in football and if investments in technology could lead the team to financial independence.
Authors :: Feng Zhu, Karim R. Lakhani, Sascha L. Schmidt, Kerry Herman
Swot Analysis of "TSG Hoffenheim: Football in the Age of Analytics" written by Feng Zhu, Karim R. Lakhani, Sascha L. Schmidt, Kerry Herman includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Hoffenheim Tsg facing as an external strategic factors. Some of the topics covered in TSG Hoffenheim: Football in the Age of Analytics case study are - Strategic Management Strategies, Performance measurement, Technology and Technology & Operations.
Some of the macro environment factors that can be used to understand the TSG Hoffenheim: Football in the Age of Analytics casestudy better are - – digital marketing is dominated by two big players Facebook and Google, increasing commodity prices, there is backlash against globalization, increasing government debt because of Covid-19 spendings, technology disruption, supply chains are disrupted by pandemic , banking and financial system is disrupted by Bitcoin and other crypto currencies,
customer relationship management is fast transforming because of increasing concerns over data privacy, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of TSG Hoffenheim: Football in the Age of Analytics
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in TSG Hoffenheim: Football in the Age of Analytics case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Hoffenheim Tsg, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Hoffenheim Tsg 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 TSG Hoffenheim: Football in the Age of Analytics can be done for the following purposes –
1. Strategic planning using facts provided in TSG Hoffenheim: Football in the Age of Analytics case study
2. Improving business portfolio management of Hoffenheim Tsg
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 Hoffenheim Tsg
Strengths TSG Hoffenheim: Football in the Age of Analytics | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Hoffenheim Tsg in TSG Hoffenheim: Football in the Age of Analytics Harvard Business Review case study are -
Operational resilience
– The operational resilience strategy in the TSG Hoffenheim: Football in the Age of Analytics 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.
Analytics focus
– Hoffenheim Tsg 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 Feng Zhu, Karim R. Lakhani, Sascha L. Schmidt, Kerry Herman 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
– Hoffenheim Tsg 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 lead change in Technology & Operations field
– Hoffenheim Tsg 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 Hoffenheim Tsg in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Innovation driven organization
– Hoffenheim Tsg is one of the most innovative firm in sector. Manager in TSG Hoffenheim: Football in the Age of Analytics Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Cross disciplinary teams
– Horizontal connected teams at the Hoffenheim Tsg 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.
Sustainable margins compare to other players in Technology & Operations industry
– TSG Hoffenheim: Football in the Age of Analytics firm has clearly differentiated products in the market place. This has enabled Hoffenheim Tsg to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Hoffenheim Tsg to invest into research and development (R&D) and innovation.
Ability to recruit top talent
– Hoffenheim Tsg is one of the leading recruiters in the industry. Managers in the TSG Hoffenheim: Football in the Age of Analytics are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Organizational Resilience of Hoffenheim Tsg
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Hoffenheim Tsg does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High brand equity
– Hoffenheim Tsg has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Hoffenheim Tsg to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Learning organization
- Hoffenheim Tsg 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 Hoffenheim Tsg is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in TSG Hoffenheim: Football in the Age of Analytics Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Low bargaining power of suppliers
– Suppliers of Hoffenheim Tsg in the sector have low bargaining power. TSG Hoffenheim: Football in the Age of Analytics has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Hoffenheim Tsg to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses TSG Hoffenheim: Football in the Age of Analytics | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of TSG Hoffenheim: Football in the Age of Analytics are -
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study TSG Hoffenheim: Football in the Age of Analytics, it seems that the employees of Hoffenheim Tsg 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Hoffenheim Tsg 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 bargaining power of channel partners
– Because of the regulatory requirements, Feng Zhu, Karim R. Lakhani, Sascha L. Schmidt, Kerry Herman suggests that, Hoffenheim Tsg 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study TSG Hoffenheim: Football in the Age of Analytics, in the dynamic environment Hoffenheim Tsg has struggled to respond to the nimble upstart competition. Hoffenheim Tsg has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Interest costs
– Compare to the competition, Hoffenheim Tsg 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.
Skills based hiring
– The stress on hiring functional specialists at Hoffenheim Tsg 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.
Lack of clear differentiation of Hoffenheim Tsg products
– To increase the profitability and margins on the products, Hoffenheim Tsg needs to provide more differentiated products than what it is currently offering in the marketplace.
Products dominated business model
– Even though Hoffenheim Tsg 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 - TSG Hoffenheim: Football in the Age of Analytics should strive to include more intangible value offerings along with its core products and services.
Slow to strategic competitive environment developments
– As TSG Hoffenheim: Football in the Age of Analytics HBR case study mentions - Hoffenheim Tsg 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.
High cash cycle compare to competitors
Hoffenheim Tsg 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.
Low market penetration in new markets
– Outside its home market of Hoffenheim Tsg, firm in the HBR case study TSG Hoffenheim: Football in the Age of Analytics needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Opportunities TSG Hoffenheim: Football in the Age of Analytics | 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 TSG Hoffenheim: Football in the Age of Analytics are -
Better consumer reach
– The expansion of the 5G network will help Hoffenheim Tsg to increase its market reach. Hoffenheim Tsg 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.
Using analytics as competitive advantage
– Hoffenheim Tsg 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 TSG Hoffenheim: Football in the Age of Analytics - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Hoffenheim Tsg to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Building a culture of innovation
– managers at Hoffenheim Tsg 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Hoffenheim Tsg 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 Hoffenheim Tsg to hire the very best people irrespective of their geographical location.
Loyalty marketing
– Hoffenheim Tsg 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Hoffenheim Tsg 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.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Hoffenheim Tsg to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Hoffenheim Tsg can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Developing new processes and practices
– Hoffenheim Tsg 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.
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. Hoffenheim Tsg 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. Hoffenheim Tsg 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Hoffenheim Tsg 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. Hoffenheim Tsg can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Manufacturing automation
– Hoffenheim Tsg 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 TSG Hoffenheim: Football in the Age of Analytics External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study TSG Hoffenheim: Football in the Age of Analytics are -
Regulatory challenges
– Hoffenheim Tsg 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Hoffenheim Tsg 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 TSG Hoffenheim: Football in the Age of Analytics .
Consumer confidence and its impact on Hoffenheim Tsg 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 Hoffenheim Tsg
– 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 Hoffenheim Tsg.
High dependence on third party suppliers
– Hoffenheim Tsg 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.
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 Hoffenheim Tsg business can come under increasing regulations regarding data privacy, data security, etc.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study TSG Hoffenheim: Football in the Age of Analytics, Hoffenheim Tsg 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 .
Environmental challenges
– Hoffenheim Tsg 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. Hoffenheim Tsg can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
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. Hoffenheim Tsg 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.
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. Hoffenheim Tsg can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Technology acceleration in Forth Industrial Revolution
– Hoffenheim Tsg has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Hoffenheim Tsg 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.
Weighted SWOT Analysis of TSG Hoffenheim: Football in the Age of Analytics 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 TSG Hoffenheim: Football in the Age of Analytics 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 TSG Hoffenheim: Football in the Age of Analytics 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 TSG Hoffenheim: Football in the Age of Analytics 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 TSG Hoffenheim: Football in the Age of Analytics 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 Hoffenheim Tsg needs to make to build a sustainable competitive advantage.
