Madison Avenue: Digital Media Services (C) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Madison Avenue: Digital Media Services (C)
By July 2000, Madison Avenue had experienced extraordinary growth in sales, employees, clients, and service offerings. From late 1999 to July 2000, the company had taken several initiatives to redesign its internal processes so that the firm could continue to grow, while maintaining the quality of its service offering and increasing efficiency enough to show profitability. Matt Garvin, the company's chief strategy officer, was considering a host of new service offerings to complement its core service--active management of online advertising. The question to Garvin was twofold: What opportunities made strategic sense for the company? What strategic opportunities matched well with the company's operational capabilities? How reliable, robust, and responsive are they? Can they handle the growth, scale, and scope that Garvin is contemplating. Can be taught alone as a strategy case or in conjunction with the (B) case to emphasize the product-process matching problem. If taught together, one case can be assigned to half the students, the other case to the other half to simulate more fully the organizational challenge of communicating across functional specialties--i.e., the service equivalent of product development, production, marketing, and sales.
Swot Analysis of "Madison Avenue: Digital Media Services (C)" written by Steven J. Spear, Anne D. Karshis includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Garvin Avenue facing as an external strategic factors. Some of the topics covered in Madison Avenue: Digital Media Services (C) case study are - Strategic Management Strategies, Internet, Marketing, Product development, Supply chain and Technology & Operations.
Some of the macro environment factors that can be used to understand the Madison Avenue: Digital Media Services (C) casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, competitive advantages are harder to sustain because of technology dispersion, increasing household debt because of falling income levels, digital marketing is dominated by two big players Facebook and Google, challanges to central banks by blockchain based private currencies, cloud computing is disrupting traditional business models, wage bills are increasing,
increasing commodity prices, talent flight as more people leaving formal jobs, etc
Introduction to SWOT Analysis of Madison Avenue: Digital Media Services (C)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Madison Avenue: Digital Media Services (C) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Garvin Avenue, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Garvin Avenue 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 Madison Avenue: Digital Media Services (C) can be done for the following purposes –
1. Strategic planning using facts provided in Madison Avenue: Digital Media Services (C) case study
2. Improving business portfolio management of Garvin Avenue
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 Garvin Avenue
Strengths Madison Avenue: Digital Media Services (C) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Garvin Avenue in Madison Avenue: Digital Media Services (C) Harvard Business Review case study are -
Sustainable margins compare to other players in Technology & Operations industry
– Madison Avenue: Digital Media Services (C) firm has clearly differentiated products in the market place. This has enabled Garvin Avenue to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Garvin Avenue to invest into research and development (R&D) and innovation.
Learning organization
- Garvin Avenue 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 Garvin Avenue is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Madison Avenue: Digital Media Services (C) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to lead change in Technology & Operations field
– Garvin Avenue is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Garvin Avenue in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Operational resilience
– The operational resilience strategy in the Madison Avenue: Digital Media Services (C) 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.
Effective Research and Development (R&D)
– Garvin Avenue 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 Madison Avenue: Digital Media Services (C) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Training and development
– Garvin Avenue has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Madison Avenue: Digital Media Services (C) 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 Garvin Avenue
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Garvin Avenue does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High brand equity
– Garvin Avenue has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Garvin Avenue to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Successful track record of launching new products
– Garvin Avenue has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Garvin Avenue 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.
Low bargaining power of suppliers
– Suppliers of Garvin Avenue in the sector have low bargaining power. Madison Avenue: Digital Media Services (C) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Garvin Avenue to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Garvin Avenue in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the Garvin Avenue 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.
Weaknesses Madison Avenue: Digital Media Services (C) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Madison Avenue: Digital Media Services (C) are -
Low market penetration in new markets
– Outside its home market of Garvin Avenue, firm in the HBR case study Madison Avenue: Digital Media Services (C) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High operating costs
– Compare to the competitors, firm in the HBR case study Madison Avenue: Digital Media Services (C) 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 Garvin Avenue 's lucrative customers.
Capital Spending Reduction
– Even during the low interest decade, Garvin Avenue 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.
Products dominated business model
– Even though Garvin Avenue 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 - Madison Avenue: Digital Media Services (C) should strive to include more intangible value offerings along with its core products and services.
High bargaining power of channel partners
– Because of the regulatory requirements, Steven J. Spear, Anne D. Karshis suggests that, Garvin Avenue 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.
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 Garvin Avenue supply chain. Even after few cautionary changes mentioned in the HBR case study - Madison Avenue: Digital Media Services (C), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Garvin Avenue vulnerable to further global disruptions in South East Asia.
Slow decision making process
– As mentioned earlier in the report, Garvin Avenue 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. Garvin Avenue 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 Madison Avenue: Digital Media Services (C), in the dynamic environment Garvin Avenue has struggled to respond to the nimble upstart competition. Garvin Avenue has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Workers concerns about automation
– As automation is fast increasing in the segment, Garvin Avenue 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.
Need for greater diversity
– Garvin Avenue has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Madison Avenue: Digital Media Services (C), it seems that the employees of Garvin Avenue 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.
Opportunities Madison Avenue: Digital Media Services (C) | 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 Madison Avenue: Digital Media Services (C) are -
Developing new processes and practices
– Garvin Avenue 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.
Creating value in data economy
– The success of analytics program of Garvin Avenue has opened avenues for new revenue streams for the organization in the industry. This can help Garvin Avenue to build a more holistic ecosystem as suggested in the Madison Avenue: Digital Media Services (C) case study. Garvin Avenue can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Leveraging digital technologies
– Garvin Avenue 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.
Using analytics as competitive advantage
– Garvin Avenue 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 Madison Avenue: Digital Media Services (C) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Garvin Avenue to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Low interest rates
– Even though inflation is raising its head in most developed economies, Garvin Avenue 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 Garvin Avenue 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.
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. Garvin Avenue 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. Garvin Avenue 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.
Building a culture of innovation
– managers at Garvin Avenue 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.
Buying journey improvements
– Garvin Avenue can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Madison Avenue: Digital Media Services (C) 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.
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. Garvin Avenue can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Loyalty marketing
– Garvin Avenue 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, Garvin Avenue is facing challenges because of the dominance of functional experts in the organization. Madison Avenue: Digital Media Services (C) 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 Garvin Avenue in the consumer business. Now Garvin Avenue can target international markets with far fewer capital restrictions requirements than the existing system.
Threats Madison Avenue: Digital Media Services (C) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Madison Avenue: Digital Media Services (C) are -
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. Garvin Avenue can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Garvin Avenue in the Technology & Operations sector and impact the bottomline of the organization.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Madison Avenue: Digital Media Services (C), Garvin Avenue 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 .
High dependence on third party suppliers
– Garvin Avenue high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Technology acceleration in Forth Industrial Revolution
– Garvin Avenue has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Garvin Avenue 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.
Environmental challenges
– Garvin Avenue 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. Garvin Avenue can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Garvin Avenue with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Garvin Avenue.
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. Garvin Avenue 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.
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. Garvin Avenue needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
Regulatory challenges
– Garvin Avenue 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.
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.
Weighted SWOT Analysis of Madison Avenue: Digital Media Services (C) 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 Madison Avenue: Digital Media Services (C) 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 Madison Avenue: Digital Media Services (C) 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 Madison Avenue: Digital Media Services (C) 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 Madison Avenue: Digital Media Services (C) 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 Garvin Avenue needs to make to build a sustainable competitive advantage.
