Volant brought innovation to the ski equipment industry in 1989 by developing a stainless steel ski. He claimed the skis could turn more easily, could hold an edge in icy conditions, and were more stable than aluminum or fiberglass skis. The company's "soft-flex" technology was patented, and soon word spread throughout the skiing community about the new high-performance ski. The company decided to offer a narrow product line. In 1995, Volant was unable to fulfill all its orders due to lingering manufacturing problems. A new operations manager came in and improved manufacturing yields, lowered costs significantly, and brought in a CAD/CAM system to streamline prototype design. The 1997 season was heralded by on-time delivery of promised shipments, and the company's reputation climbed. With the leader in the ski equipment industry capturing less than 25% of the market, Volant considered its strategy for competing in a fragmented market. In 1994, hourglass-shaped skis became a new trend, and Volant decided to make shaped skis exclusively. They also acquired the rights to a snowboard design at its manufacturing facility in Denver. Although Volant was the fourth best-selling supplier in the United States by 1998, it still was not a profitable company. It had to consider new growth strategies to become a leader in its industry and to yield a return for its investors.
Authors :: Steven C. Wheelwright, Matthew C. Verlinden
Swot Analysis of "Volant Skis" written by Steven C. Wheelwright, Matthew C. Verlinden includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Volant Skis facing as an external strategic factors. Some of the topics covered in Volant Skis case study are - Strategic Management Strategies, Developing employees, Growth strategy, Operations management, Product development and Technology & Operations.
Some of the macro environment factors that can be used to understand the Volant Skis casestudy better are - – increasing household debt because of falling income levels, geopolitical disruptions, banking and financial system is disrupted by Bitcoin and other crypto currencies, competitive advantages are harder to sustain because of technology dispersion, cloud computing is disrupting traditional business models, increasing inequality as vast percentage of new income is going to the top 1%, talent flight as more people leaving formal jobs,
supply chains are disrupted by pandemic , central banks are concerned over increasing inflation, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Volant Skis case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Volant Skis, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Volant Skis 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 Volant Skis can be done for the following purposes –
1. Strategic planning using facts provided in Volant Skis case study
2. Improving business portfolio management of Volant Skis
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 Volant Skis
Strengths Volant Skis | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Volant Skis in Volant Skis Harvard Business Review case study are -
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Volant Skis digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Volant Skis 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.
Ability to lead change in Technology & Operations field
– Volant Skis 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 Volant Skis in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Sustainable margins compare to other players in Technology & Operations industry
– Volant Skis firm has clearly differentiated products in the market place. This has enabled Volant Skis to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Volant Skis to invest into research and development (R&D) and innovation.
Learning organization
- Volant Skis 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 Volant Skis is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Volant Skis Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Low bargaining power of suppliers
– Suppliers of Volant Skis in the sector have low bargaining power. Volant Skis has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Volant Skis to manage not only supply disruptions but also source products at highly competitive prices.
Effective Research and Development (R&D)
– Volant Skis 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 Volant Skis - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Organizational Resilience of Volant Skis
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Volant Skis does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Innovation driven organization
– Volant Skis is one of the most innovative firm in sector. Manager in Volant Skis Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Diverse revenue streams
– Volant Skis is present in almost all the verticals within the industry. This has provided firm in Volant Skis 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.
Ability to recruit top talent
– Volant Skis is one of the leading recruiters in the industry. Managers in the Volant Skis 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
– Volant Skis has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Volant Skis to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
High switching costs
– The high switching costs that Volant Skis has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Weaknesses Volant Skis | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Volant Skis are -
Skills based hiring
– The stress on hiring functional specialists at Volant Skis 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Volant Skis 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 Volant Skis 's lucrative customers.
Lack of clear differentiation of Volant Skis products
– To increase the profitability and margins on the products, Volant Skis needs to provide more differentiated products than what it is currently offering in the marketplace.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Volant Skis, is just above the industry average. Volant Skis 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 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 Volant Skis supply chain. Even after few cautionary changes mentioned in the HBR case study - Volant Skis, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Volant Skis vulnerable to further global disruptions in South East Asia.
Increasing silos among functional specialists
– The organizational structure of Volant Skis is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Volant Skis needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Volant Skis to focus more on services rather than just following the product oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Volant Skis 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.
Slow to strategic competitive environment developments
– As Volant Skis HBR case study mentions - Volant Skis takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Low market penetration in new markets
– Outside its home market of Volant Skis, firm in the HBR case study Volant Skis needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Volant Skis 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 Volant Skis has relatively successful track record of launching new products.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Volant Skis, in the dynamic environment Volant Skis has struggled to respond to the nimble upstart competition. Volant Skis has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Opportunities Volant Skis | 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 Volant Skis are -
Developing new processes and practices
– Volant Skis 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.
Building a culture of innovation
– managers at Volant Skis 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.
Leveraging digital technologies
– Volant Skis 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
– Volant Skis 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 Volant Skis - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Volant Skis to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Loyalty marketing
– Volant Skis 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.
Better consumer reach
– The expansion of the 5G network will help Volant Skis to increase its market reach. Volant Skis will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Buying journey improvements
– Volant Skis can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Volant Skis 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Volant Skis can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Volant Skis 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. Volant Skis 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.
Creating value in data economy
– The success of analytics program of Volant Skis has opened avenues for new revenue streams for the organization in the industry. This can help Volant Skis to build a more holistic ecosystem as suggested in the Volant Skis case study. Volant Skis can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Volant Skis 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, Volant Skis, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Volant Skis is facing challenges because of the dominance of functional experts in the organization. Volant Skis 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.
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. Volant Skis can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats Volant Skis External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Volant Skis are -
Increasing wage structure of Volant Skis
– 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 Volant Skis.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Volant Skis, Volant Skis 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 .
Consumer confidence and its impact on Volant Skis 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Volant Skis 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 Volant Skis .
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. Volant Skis can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Volant Skis.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Volant Skis 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.
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 Volant Skis business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Volant Skis 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.
Technology acceleration in Forth Industrial Revolution
– Volant Skis has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Volant Skis 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.
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 Volant Skis in the Technology & Operations sector and impact the bottomline of the organization.
Shortening product life cycle
– it is one of the major threat that Volant Skis is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Volant Skis 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 Volant Skis 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 Volant Skis 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 Volant Skis 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 Volant Skis 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 Volant Skis needs to make to build a sustainable competitive advantage.