X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B)
Three years after launching his brick-and-mortar store, X Fire Paintball and Airsoft, Steve Herbert Sr. and his sons began selling products on Amazon.com's third-party Marketplace and online sales expanded rapidly. Over time, X Fire noticed that products of which it had once been the only seller were now being sold by Amazon straight from X Fire's suppliers, effectively cutting X Fire out. Amazon was also ignoring the minimum advertised price (MAP) set by manufacturers. How should X Fire defend itself? Now Amazon representatives were approaching X Fire to encourage them to sell on Amazon's smaller but growing Canadian Marketplace. How should X Fire respond to this opportunity?
Swot Analysis of "X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B)" written by Feng Zhu, Angela Acocella includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Fire Amazon facing as an external strategic factors. Some of the topics covered in X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) case study are - Strategic Management Strategies, IT, Operations management and Technology & Operations.
Some of the macro environment factors that can be used to understand the X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) casestudy better are - – increasing commodity prices, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing transportation and logistics costs, there is backlash against globalization, increasing government debt because of Covid-19 spendings, cloud computing is disrupting traditional business models, increasing household debt because of falling income levels,
geopolitical disruptions, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Fire Amazon, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Fire Amazon 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 X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) can be done for the following purposes –
1. Strategic planning using facts provided in X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) case study
2. Improving business portfolio management of Fire Amazon
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 Fire Amazon
Strengths X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Fire Amazon in X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) Harvard Business Review case study are -
Innovation driven organization
– Fire Amazon is one of the most innovative firm in sector. Manager in X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Analytics focus
– Fire Amazon 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, Angela Acocella 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
– Fire Amazon is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Low bargaining power of suppliers
– Suppliers of Fire Amazon in the sector have low bargaining power. X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Fire Amazon to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that Fire Amazon has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Successful track record of launching new products
– Fire Amazon has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Fire Amazon 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.
Diverse revenue streams
– Fire Amazon is present in almost all the verticals within the industry. This has provided firm in X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) 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.
Learning organization
- Fire Amazon 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 Fire Amazon is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– Fire Amazon is one of the leading recruiters in the industry. Managers in the X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) 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
– Fire Amazon has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Fire Amazon to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Training and development
– Fire Amazon has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) 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.
Organizational Resilience of Fire Amazon
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Fire Amazon does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) are -
Lack of clear differentiation of Fire Amazon products
– To increase the profitability and margins on the products, Fire Amazon needs to provide more differentiated products than what it is currently offering in the marketplace.
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 Fire Amazon supply chain. Even after few cautionary changes mentioned in the HBR case study - X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Fire Amazon vulnerable to further global disruptions in South East Asia.
Low market penetration in new markets
– Outside its home market of Fire Amazon, firm in the HBR case study X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B), is just above the industry average. Fire Amazon 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 dependence on star products
– The top 2 products and services of the firm as mentioned in the X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) 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 Fire Amazon has relatively successful track record of launching new products.
Slow decision making process
– As mentioned earlier in the report, Fire Amazon 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. Fire Amazon 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 X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B), in the dynamic environment Fire Amazon has struggled to respond to the nimble upstart competition. Fire Amazon has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B), it seems that the employees of Fire Amazon 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.
High cash cycle compare to competitors
Fire Amazon 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.
Products dominated business model
– Even though Fire Amazon 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 - X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) should strive to include more intangible value offerings along with its core products and services.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Fire Amazon is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) | 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 X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) are -
Developing new processes and practices
– Fire Amazon 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.
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 Fire Amazon in the consumer business. Now Fire Amazon can target international markets with far fewer capital restrictions requirements than the existing system.
Using analytics as competitive advantage
– Fire Amazon 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 X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Fire Amazon to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Fire Amazon can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Fire Amazon can use these opportunities to build new business models that can help the communities that Fire Amazon operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Buying journey improvements
– Fire Amazon can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) 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.
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 Fire Amazon 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.
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. Fire Amazon 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. Fire Amazon 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 Fire Amazon 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.
Loyalty marketing
– Fire Amazon 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, Fire Amazon is facing challenges because of the dominance of functional experts in the organization. X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) 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
– Fire Amazon 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Fire Amazon 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.
Threats X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) are -
Consumer confidence and its impact on Fire Amazon 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.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
High dependence on third party suppliers
– Fire Amazon 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.
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. Fire Amazon can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Fire Amazon with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Regulatory challenges
– Fire Amazon 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.
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 Fire Amazon business can come under increasing regulations regarding data privacy, data security, etc.
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. Fire Amazon needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
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. Fire Amazon 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B), Fire Amazon 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 .
Technology acceleration in Forth Industrial Revolution
– Fire Amazon has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Fire Amazon 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.
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Fire Amazon 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.
Weighted SWOT Analysis of X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) 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 X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) 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 X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) 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 X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) 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 X Fire Paintball & Airsoft: is Amazon a Friend or Foe? (B) 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 Fire Amazon needs to make to build a sustainable competitive advantage.