Building Watson: Not So Elementary, My Dear! (Abridged) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Building Watson: Not So Elementary, My Dear! (Abridged)
This case is set inside IBM Research's efforts to build a computer that can successfully take on human challengers playing the game show Jeopardy! It opens with the machine named Watson offering the incorrect answer ""Toronto"" to a seemingly simple question during the championship match. Was the answer a reflection of a strategic weakness, or was it actually consistent with design principles established by the development team? The case seeks to expand students' view of the product development process. Traditional software development projects begin with the gathering of requirements and analysis of the problem, and the writing of a detailed specification. The Jeopardy! problem is different-it requires a probabilistic approach where there is no closed form solution. Instead statistical patterns in the data are important and there is no obvious mapping to the way queries are expressed. Such problems are increasingly common in data mining, optimization problems, or Internet applications where the goal is to find an acceptably good solution in a short amount of time, when a deterministic approach might be less fruitful or impractical. We aspire for students to recognize that product development can take many forms, and that these are enabled by creativity and the right organizational flexibility and mindset. This abridged version of the case focuses on the choice of Jeopardy! as the development target, and the approach taken by the development team. The original case is HBS No. 612-017, and has much more detail on the design strategy for the Watson system. This abridged version of the case focuses on the choice of Jeoprady! as the development target, and the approach taken by the development team. The original case is HBS No. 612-017, and has much more detail on the design strategy for the Watson system.
Swot Analysis of "Building Watson: Not So Elementary, My Dear! (Abridged)" written by Willy Shih includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Watson Jeopardy facing as an external strategic factors. Some of the topics covered in Building Watson: Not So Elementary, My Dear! (Abridged) case study are - Strategic Management Strategies, IT, Operations management, Product development, Strategy and Technology & Operations.
Some of the macro environment factors that can be used to understand the Building Watson: Not So Elementary, My Dear! (Abridged) casestudy better are - – wage bills are increasing, technology disruption, increasing commodity prices, increasing energy prices, increasing household debt because of falling income levels, central banks are concerned over increasing inflation, competitive advantages are harder to sustain because of technology dispersion,
increasing inequality as vast percentage of new income is going to the top 1%, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of Building Watson: Not So Elementary, My Dear! (Abridged)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Building Watson: Not So Elementary, My Dear! (Abridged) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Watson Jeopardy, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Watson Jeopardy 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 Building Watson: Not So Elementary, My Dear! (Abridged) can be done for the following purposes –
1. Strategic planning using facts provided in Building Watson: Not So Elementary, My Dear! (Abridged) case study
2. Improving business portfolio management of Watson Jeopardy
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 Watson Jeopardy
Strengths Building Watson: Not So Elementary, My Dear! (Abridged) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Watson Jeopardy in Building Watson: Not So Elementary, My Dear! (Abridged) Harvard Business Review case study are -
High brand equity
– Watson Jeopardy has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Watson Jeopardy to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Successful track record of launching new products
– Watson Jeopardy has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Watson Jeopardy 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.
Ability to recruit top talent
– Watson Jeopardy is one of the leading recruiters in the industry. Managers in the Building Watson: Not So Elementary, My Dear! (Abridged) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Watson Jeopardy digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Watson Jeopardy 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.
Analytics focus
– Watson Jeopardy 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.
Diverse revenue streams
– Watson Jeopardy is present in almost all the verticals within the industry. This has provided firm in Building Watson: Not So Elementary, My Dear! (Abridged) 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.
Superior customer experience
– The customer experience strategy of Watson Jeopardy in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Effective Research and Development (R&D)
– Watson Jeopardy 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 Building Watson: Not So Elementary, My Dear! (Abridged) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Innovation driven organization
– Watson Jeopardy is one of the most innovative firm in sector. Manager in Building Watson: Not So Elementary, My Dear! (Abridged) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Highly skilled collaborators
– Watson Jeopardy has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Building Watson: Not So Elementary, My Dear! (Abridged) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Strong track record of project management
– Watson Jeopardy is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Operational resilience
– The operational resilience strategy in the Building Watson: Not So Elementary, My Dear! (Abridged) 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.
Weaknesses Building Watson: Not So Elementary, My Dear! (Abridged) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Building Watson: Not So Elementary, My Dear! (Abridged) are -
Workers concerns about automation
– As automation is fast increasing in the segment, Watson Jeopardy 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.
Interest costs
– Compare to the competition, Watson Jeopardy 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.
Slow decision making process
– As mentioned earlier in the report, Watson Jeopardy 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. Watson Jeopardy 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Building Watson: Not So Elementary, My Dear! (Abridged), in the dynamic environment Watson Jeopardy has struggled to respond to the nimble upstart competition. Watson Jeopardy has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
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 Watson Jeopardy supply chain. Even after few cautionary changes mentioned in the HBR case study - Building Watson: Not So Elementary, My Dear! (Abridged), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Watson Jeopardy vulnerable to further global disruptions in South East Asia.
High operating costs
– Compare to the competitors, firm in the HBR case study Building Watson: Not So Elementary, My Dear! (Abridged) 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 Watson Jeopardy 's lucrative customers.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Building Watson: Not So Elementary, My Dear! (Abridged) 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 Watson Jeopardy has relatively successful track record of launching new products.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Watson Jeopardy is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Building Watson: Not So Elementary, My Dear! (Abridged) can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Increasing silos among functional specialists
– The organizational structure of Watson Jeopardy is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Watson Jeopardy needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Watson Jeopardy to focus more on services rather than just following the product oriented approach.
High cash cycle compare to competitors
Watson Jeopardy 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.
Skills based hiring
– The stress on hiring functional specialists at Watson Jeopardy 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.
Opportunities Building Watson: Not So Elementary, My Dear! (Abridged) | 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 Building Watson: Not So Elementary, My Dear! (Abridged) are -
Creating value in data economy
– The success of analytics program of Watson Jeopardy has opened avenues for new revenue streams for the organization in the industry. This can help Watson Jeopardy to build a more holistic ecosystem as suggested in the Building Watson: Not So Elementary, My Dear! (Abridged) case study. Watson Jeopardy can build new products and services such as - data insight services, data privacy related products, data based consulting services, 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, Watson Jeopardy can use these opportunities to build new business models that can help the communities that Watson Jeopardy operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Using analytics as competitive advantage
– Watson Jeopardy 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 Building Watson: Not So Elementary, My Dear! (Abridged) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Watson Jeopardy to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Watson Jeopardy can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Watson Jeopardy can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Loyalty marketing
– Watson Jeopardy 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.
Leveraging digital technologies
– Watson Jeopardy 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.
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. Watson Jeopardy can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Better consumer reach
– The expansion of the 5G network will help Watson Jeopardy to increase its market reach. Watson Jeopardy 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Watson Jeopardy 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.
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 Watson Jeopardy in the consumer business. Now Watson Jeopardy can target international markets with far fewer capital restrictions requirements than the existing system.
Building a culture of innovation
– managers at Watson Jeopardy 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Watson Jeopardy 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, Building Watson: Not So Elementary, My Dear! (Abridged), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Threats Building Watson: Not So Elementary, My Dear! (Abridged) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Building Watson: Not So Elementary, My Dear! (Abridged) are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Building Watson: Not So Elementary, My Dear! (Abridged), Watson Jeopardy 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 .
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.
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. Watson Jeopardy needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
Shortening product life cycle
– it is one of the major threat that Watson Jeopardy is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing wage structure of Watson Jeopardy
– 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 Watson Jeopardy.
Stagnating economy with rate increase
– Watson Jeopardy can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Watson Jeopardy in the Technology & Operations sector and impact the bottomline of the organization.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Watson Jeopardy 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 Building Watson: Not So Elementary, My Dear! (Abridged) .
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. Watson Jeopardy 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.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Watson Jeopardy with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Watson Jeopardy can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Regulatory challenges
– Watson Jeopardy 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.
Weighted SWOT Analysis of Building Watson: Not So Elementary, My Dear! (Abridged) 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 Building Watson: Not So Elementary, My Dear! (Abridged) 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 Building Watson: Not So Elementary, My Dear! (Abridged) 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 Building Watson: Not So Elementary, My Dear! (Abridged) 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 Building Watson: Not So Elementary, My Dear! (Abridged) 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 Watson Jeopardy needs to make to build a sustainable competitive advantage.