Activision: The 'Kelly Slater's Pro Surfer' Project SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Activision: The 'Kelly Slater's Pro Surfer' Project
Mike Ward, the producer in charge of developing the Kelly Slater's Pro Surfer game for Activision, must decide whether to launch the game in time for the 2002 Christmas season. Complicating his decision are the lukewarm response from consumers to TV test spots of the game and the need to fund a multimillion dollar marketing campaign. Also describes Activision's approach to game development, which was based on a green-light process adopted by the firm in 2000 to better control new game development better.
Authors :: Alan MacCormack, Kerry Herman, Enrico D'Angelo
Swot Analysis of "Activision: The 'Kelly Slater's Pro Surfer' Project" written by Alan MacCormack, Kerry Herman, Enrico D'Angelo includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Game Surfer facing as an external strategic factors. Some of the topics covered in Activision: The 'Kelly Slater's Pro Surfer' Project case study are - Strategic Management Strategies, Decision making, Product development and Technology & Operations.
Some of the macro environment factors that can be used to understand the Activision: The 'Kelly Slater's Pro Surfer' Project casestudy better are - – increasing government debt because of Covid-19 spendings, increasing transportation and logistics costs, technology disruption, challanges to central banks by blockchain based private currencies, increasing inequality as vast percentage of new income is going to the top 1%, increasing energy prices, increasing commodity prices,
wage bills are increasing, talent flight as more people leaving formal jobs, etc
Introduction to SWOT Analysis of Activision: The 'Kelly Slater's Pro Surfer' Project
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Activision: The 'Kelly Slater's Pro Surfer' Project case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Game Surfer, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Game Surfer 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 Activision: The 'Kelly Slater's Pro Surfer' Project can be done for the following purposes –
1. Strategic planning using facts provided in Activision: The 'Kelly Slater's Pro Surfer' Project case study
2. Improving business portfolio management of Game Surfer
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 Game Surfer
Strengths Activision: The 'Kelly Slater's Pro Surfer' Project | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Game Surfer in Activision: The 'Kelly Slater's Pro Surfer' Project Harvard Business Review case study are -
Sustainable margins compare to other players in Technology & Operations industry
– Activision: The 'Kelly Slater's Pro Surfer' Project firm has clearly differentiated products in the market place. This has enabled Game Surfer to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Game Surfer to invest into research and development (R&D) and innovation.
Operational resilience
– The operational resilience strategy in the Activision: The 'Kelly Slater's Pro Surfer' Project 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.
Training and development
– Game Surfer has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Activision: The 'Kelly Slater's Pro Surfer' Project 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.
Low bargaining power of suppliers
– Suppliers of Game Surfer in the sector have low bargaining power. Activision: The 'Kelly Slater's Pro Surfer' Project has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Game Surfer to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Game Surfer in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Game Surfer digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Game Surfer 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.
Effective Research and Development (R&D)
– Game Surfer 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 Activision: The 'Kelly Slater's Pro Surfer' Project - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Cross disciplinary teams
– Horizontal connected teams at the Game Surfer 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.
Ability to recruit top talent
– Game Surfer is one of the leading recruiters in the industry. Managers in the Activision: The 'Kelly Slater's Pro Surfer' Project are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
High brand equity
– Game Surfer has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Game Surfer to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Analytics focus
– Game Surfer 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 Alan MacCormack, Kerry Herman, Enrico D'Angelo 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.
High switching costs
– The high switching costs that Game Surfer 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.
Weaknesses Activision: The 'Kelly Slater's Pro Surfer' Project | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Activision: The 'Kelly Slater's Pro Surfer' Project are -
Workers concerns about automation
– As automation is fast increasing in the segment, Game Surfer 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 operating costs
– Compare to the competitors, firm in the HBR case study Activision: The 'Kelly Slater's Pro Surfer' Project 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 Game Surfer 's lucrative customers.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Activision: The 'Kelly Slater's Pro Surfer' Project, is just above the industry average. Game Surfer needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
High cash cycle compare to competitors
Game Surfer 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Activision: The 'Kelly Slater's Pro Surfer' Project 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 Game Surfer has relatively successful track record of launching new products.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Activision: The 'Kelly Slater's Pro Surfer' Project, in the dynamic environment Game Surfer has struggled to respond to the nimble upstart competition. Game Surfer has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High bargaining power of channel partners
– Because of the regulatory requirements, Alan MacCormack, Kerry Herman, Enrico D'Angelo suggests that, Game Surfer 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.
No frontier risks strategy
– After analyzing the HBR case study Activision: The 'Kelly Slater's Pro Surfer' Project, 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.
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 Game Surfer supply chain. Even after few cautionary changes mentioned in the HBR case study - Activision: The 'Kelly Slater's Pro Surfer' Project, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Game Surfer vulnerable to further global disruptions in South East Asia.
Interest costs
– Compare to the competition, Game Surfer 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.
Lack of clear differentiation of Game Surfer products
– To increase the profitability and margins on the products, Game Surfer needs to provide more differentiated products than what it is currently offering in the marketplace.
Opportunities Activision: The 'Kelly Slater's Pro Surfer' Project | 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 Activision: The 'Kelly Slater's Pro Surfer' Project are -
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 Game Surfer 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.
Leveraging digital technologies
– Game Surfer 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.
Better consumer reach
– The expansion of the 5G network will help Game Surfer to increase its market reach. Game Surfer 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.
Buying journey improvements
– Game Surfer can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Activision: The 'Kelly Slater's Pro Surfer' Project 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.
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. Game Surfer can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Game Surfer is facing challenges because of the dominance of functional experts in the organization. Activision: The 'Kelly Slater's Pro Surfer' Project 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.
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 Game Surfer in the consumer business. Now Game Surfer can target international markets with far fewer capital restrictions requirements than the existing system.
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. Game Surfer can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Low interest rates
– Even though inflation is raising its head in most developed economies, Game Surfer 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.
Learning at scale
– Online learning technologies has now opened space for Game Surfer 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.
Manufacturing automation
– Game Surfer 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.
Developing new processes and practices
– Game Surfer 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, Game Surfer can use these opportunities to build new business models that can help the communities that Game Surfer operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Threats Activision: The 'Kelly Slater's Pro Surfer' Project External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Activision: The 'Kelly Slater's Pro Surfer' Project 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Game Surfer 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Activision: The 'Kelly Slater's Pro Surfer' Project, Game Surfer 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 .
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 Game Surfer in the Technology & Operations sector and impact the bottomline of the organization.
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.
Regulatory challenges
– Game Surfer 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.
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. Game Surfer 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. Game Surfer can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Game Surfer 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 Activision: The 'Kelly Slater's Pro Surfer' Project .
Environmental challenges
– Game Surfer 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. Game Surfer can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
Consumer confidence and its impact on Game Surfer 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 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. Game Surfer needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
Technology acceleration in Forth Industrial Revolution
– Game Surfer has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Game Surfer 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 Activision: The 'Kelly Slater's Pro Surfer' Project 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 Activision: The 'Kelly Slater's Pro Surfer' Project 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 Activision: The 'Kelly Slater's Pro Surfer' Project 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 Activision: The 'Kelly Slater's Pro Surfer' Project 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 Activision: The 'Kelly Slater's Pro Surfer' Project 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 Game Surfer needs to make to build a sustainable competitive advantage.
