Information Technology at Cirque du Soleil: Looking Back, Moving Forward SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Information Technology at Cirque du Soleil: Looking Back, Moving Forward
The case takes place in early 2008. It illustrates the remarkable use that Cirque du Soleil makes of information technology. The case is based, in part, on the keynote speech that Danielle Savoie - who was then Vice-President of Information Technology and Knowledge Management at Cirque du Soleil - gave at the International Conference on Information Systems (ICIS) in Montreal in December 2007. The case is structured around the touring show life cycle and describes how information technology supports the complete process involved in designing, producing, staffing and diffusing shows at Cirque du Soleil. The case presents key infrastructure and applications and offers insights into how IT can support the key operational processes in an artistic, creative and innovative organization.
Swot Analysis of "Information Technology at Cirque du Soleil: Looking Back, Moving Forward" written by Suzanne Rivard, Alain Pinsonneault, Anne-Marie Croteau includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Cirque Soleil facing as an external strategic factors. Some of the topics covered in Information Technology at Cirque du Soleil: Looking Back, Moving Forward case study are - Strategic Management Strategies, Knowledge management, Strategy and Technology & Operations.
Some of the macro environment factors that can be used to understand the Information Technology at Cirque du Soleil: Looking Back, Moving Forward casestudy better are - – increasing transportation and logistics costs, competitive advantages are harder to sustain because of technology dispersion, increasing household debt because of falling income levels, increasing commodity prices, increasing government debt because of Covid-19 spendings, geopolitical disruptions, digital marketing is dominated by two big players Facebook and Google,
customer relationship management is fast transforming because of increasing concerns over data privacy, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Information Technology at Cirque du Soleil: Looking Back, Moving Forward
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Information Technology at Cirque du Soleil: Looking Back, Moving Forward case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Cirque Soleil, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Cirque Soleil 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 Information Technology at Cirque du Soleil: Looking Back, Moving Forward can be done for the following purposes –
1. Strategic planning using facts provided in Information Technology at Cirque du Soleil: Looking Back, Moving Forward case study
2. Improving business portfolio management of Cirque Soleil
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 Cirque Soleil
Strengths Information Technology at Cirque du Soleil: Looking Back, Moving Forward | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Cirque Soleil in Information Technology at Cirque du Soleil: Looking Back, Moving Forward Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of Cirque Soleil in the sector have low bargaining power. Information Technology at Cirque du Soleil: Looking Back, Moving Forward has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Cirque Soleil to manage not only supply disruptions but also source products at highly competitive prices.
Analytics focus
– Cirque Soleil 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 Suzanne Rivard, Alain Pinsonneault, Anne-Marie Croteau 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.
Training and development
– Cirque Soleil has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Information Technology at Cirque du Soleil: Looking Back, Moving Forward 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.
Effective Research and Development (R&D)
– Cirque Soleil 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 Information Technology at Cirque du Soleil: Looking Back, Moving Forward - 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 Cirque Soleil 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.
High switching costs
– The high switching costs that Cirque Soleil 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.
Ability to recruit top talent
– Cirque Soleil is one of the leading recruiters in the industry. Managers in the Information Technology at Cirque du Soleil: Looking Back, Moving Forward 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 Cirque Soleil digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Cirque Soleil 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.
Strong track record of project management
– Cirque Soleil is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Highly skilled collaborators
– Cirque Soleil 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 Information Technology at Cirque du Soleil: Looking Back, Moving Forward HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Sustainable margins compare to other players in Technology & Operations industry
– Information Technology at Cirque du Soleil: Looking Back, Moving Forward firm has clearly differentiated products in the market place. This has enabled Cirque Soleil to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Cirque Soleil to invest into research and development (R&D) and innovation.
Organizational Resilience of Cirque Soleil
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Cirque Soleil does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses Information Technology at Cirque du Soleil: Looking Back, Moving Forward | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Information Technology at Cirque du Soleil: Looking Back, Moving Forward are -
Skills based hiring
– The stress on hiring functional specialists at Cirque Soleil 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.
Capital Spending Reduction
– Even during the low interest decade, Cirque Soleil 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.
Increasing silos among functional specialists
– The organizational structure of Cirque Soleil is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Cirque Soleil needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Cirque Soleil to focus more on services rather than just following the product oriented approach.
Low market penetration in new markets
– Outside its home market of Cirque Soleil, firm in the HBR case study Information Technology at Cirque du Soleil: Looking Back, Moving Forward needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High cash cycle compare to competitors
Cirque Soleil 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Cirque Soleil 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Information Technology at Cirque du Soleil: Looking Back, Moving Forward, it seems that the employees of Cirque Soleil 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.
Products dominated business model
– Even though Cirque Soleil 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 - Information Technology at Cirque du Soleil: Looking Back, Moving Forward should strive to include more intangible value offerings along with its core products and services.
High operating costs
– Compare to the competitors, firm in the HBR case study Information Technology at Cirque du Soleil: Looking Back, Moving Forward 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 Cirque Soleil 's lucrative customers.
Slow decision making process
– As mentioned earlier in the report, Cirque Soleil 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. Cirque Soleil 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.
Interest costs
– Compare to the competition, Cirque Soleil 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.
Opportunities Information Technology at Cirque du Soleil: Looking Back, Moving Forward | 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 Information Technology at Cirque du Soleil: Looking Back, Moving Forward are -
Better consumer reach
– The expansion of the 5G network will help Cirque Soleil to increase its market reach. Cirque Soleil 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Cirque Soleil can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Using analytics as competitive advantage
– Cirque Soleil 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 Information Technology at Cirque du Soleil: Looking Back, Moving Forward - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Cirque Soleil to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Loyalty marketing
– Cirque Soleil 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Cirque Soleil is facing challenges because of the dominance of functional experts in the organization. Information Technology at Cirque du Soleil: Looking Back, Moving Forward 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.
Manufacturing automation
– Cirque Soleil 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.
Building a culture of innovation
– managers at Cirque Soleil 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Cirque Soleil 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.
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 Cirque Soleil in the consumer business. Now Cirque Soleil 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. Cirque Soleil can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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. Cirque Soleil 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. Cirque Soleil 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.
Learning at scale
– Online learning technologies has now opened space for Cirque Soleil 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 Cirque Soleil 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.
Threats Information Technology at Cirque du Soleil: Looking Back, Moving Forward External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Information Technology at Cirque du Soleil: Looking Back, Moving Forward are -
Increasing wage structure of Cirque Soleil
– 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 Cirque Soleil.
Environmental challenges
– Cirque Soleil 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. Cirque Soleil can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Information Technology at Cirque du Soleil: Looking Back, Moving Forward, Cirque Soleil 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 .
Regulatory challenges
– Cirque Soleil 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.
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. Cirque Soleil can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Stagnating economy with rate increase
– Cirque Soleil 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.
Consumer confidence and its impact on Cirque Soleil 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.
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. Cirque Soleil 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 acceleration in Forth Industrial Revolution
– Cirque Soleil has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Cirque Soleil 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Cirque Soleil with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
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 Cirque Soleil.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Cirque Soleil 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 Information Technology at Cirque du Soleil: Looking Back, Moving Forward .
Weighted SWOT Analysis of Information Technology at Cirque du Soleil: Looking Back, Moving Forward 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 Information Technology at Cirque du Soleil: Looking Back, Moving Forward 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 Information Technology at Cirque du Soleil: Looking Back, Moving Forward 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 Information Technology at Cirque du Soleil: Looking Back, Moving Forward 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 Information Technology at Cirque du Soleil: Looking Back, Moving Forward 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 Cirque Soleil needs to make to build a sustainable competitive advantage.