Da Jiang Innovations (DJI): The Rise of the Drones SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Da Jiang Innovations (DJI): The Rise of the Drones
Our case focuses on Da Jiang Innovations (DJI), the Shenzhen-based company that contributed significantly to the growing popularity of civilian drones not only in China, but also globally. It chronicles the genesis and development of the company and its recent efforts to address current challenges and anticipating future competition. DJI within a few years of producing its first drone, cornered more than 70% of the global civilian drone market and emerged as a "decacorn", which are "unicorns" that valued at least US$10 billion. However, with intensifying competition and rapid shifts in technology, DJI's leadership position could erode quickly. Additionally, as concerns about safety, privacy, and security continued to mount, what should DJI do? Our case offers students an opportunity to analyse the challenges and opportunities that confront a new market leader in an emerging industry, in the face of mounting competition and rapid technological shifts from 2017. It also showcases the rise of globally-minded Chinese firms, with DJI as an exemplar. These "born global" firms, also known as micro-multinationals, went global from the start and did not try to build a base in China's domestic markets as their first steps.
Swot Analysis of "Da Jiang Innovations (DJI): The Rise of the Drones" written by Wai Fong Boh, Wee Kiat Lim, Yi Zeng includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Dji Drone facing as an external strategic factors. Some of the topics covered in Da Jiang Innovations (DJI): The Rise of the Drones case study are - Strategic Management Strategies, Innovation, IT, Strategy and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Da Jiang Innovations (DJI): The Rise of the Drones casestudy better are - – increasing government debt because of Covid-19 spendings, cloud computing is disrupting traditional business models, there is increasing trade war between United States & China, talent flight as more people leaving formal jobs, challanges to central banks by blockchain based private currencies, increasing inequality as vast percentage of new income is going to the top 1%, increasing transportation and logistics costs,
competitive advantages are harder to sustain because of technology dispersion, wage bills are increasing, etc
Introduction to SWOT Analysis of Da Jiang Innovations (DJI): The Rise of the Drones
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Da Jiang Innovations (DJI): The Rise of the Drones case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Dji Drone, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Dji Drone 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 Da Jiang Innovations (DJI): The Rise of the Drones can be done for the following purposes –
1. Strategic planning using facts provided in Da Jiang Innovations (DJI): The Rise of the Drones case study
2. Improving business portfolio management of Dji Drone
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Dji Drone
Strengths Da Jiang Innovations (DJI): The Rise of the Drones | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Dji Drone in Da Jiang Innovations (DJI): The Rise of the Drones Harvard Business Review case study are -
Analytics focus
– Dji Drone 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 Wai Fong Boh, Wee Kiat Lim, Yi Zeng 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.
Cross disciplinary teams
– Horizontal connected teams at the Dji Drone 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.
Sustainable margins compare to other players in Strategy & Execution industry
– Da Jiang Innovations (DJI): The Rise of the Drones firm has clearly differentiated products in the market place. This has enabled Dji Drone to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Dji Drone to invest into research and development (R&D) and innovation.
Ability to lead change in Strategy & Execution field
– Dji Drone 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 Dji Drone in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Innovation driven organization
– Dji Drone is one of the most innovative firm in sector. Manager in Da Jiang Innovations (DJI): The Rise of the Drones Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
High switching costs
– The high switching costs that Dji Drone 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.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Dji Drone digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Dji Drone 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.
Highly skilled collaborators
– Dji Drone 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 Da Jiang Innovations (DJI): The Rise of the Drones HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Operational resilience
– The operational resilience strategy in the Da Jiang Innovations (DJI): The Rise of the Drones 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.
High brand equity
– Dji Drone has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Dji Drone to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Successful track record of launching new products
– Dji Drone has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Dji Drone has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Ability to recruit top talent
– Dji Drone is one of the leading recruiters in the industry. Managers in the Da Jiang Innovations (DJI): The Rise of the Drones are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Weaknesses Da Jiang Innovations (DJI): The Rise of the Drones | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Da Jiang Innovations (DJI): The Rise of the Drones are -
Products dominated business model
– Even though Dji Drone 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 - Da Jiang Innovations (DJI): The Rise of the Drones should strive to include more intangible value offerings along with its core products and services.
Increasing silos among functional specialists
– The organizational structure of Dji Drone is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Dji Drone needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Dji Drone to focus more on services rather than just following the product oriented approach.
Need for greater diversity
– Dji Drone 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 Da Jiang Innovations (DJI): The Rise of the Drones, it seems that the employees of Dji Drone 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 dependence on star products
– The top 2 products and services of the firm as mentioned in the Da Jiang Innovations (DJI): The Rise of the Drones 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 Dji Drone has relatively successful track record of launching new products.
Skills based hiring
– The stress on hiring functional specialists at Dji Drone 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.
Low market penetration in new markets
– Outside its home market of Dji Drone, firm in the HBR case study Da Jiang Innovations (DJI): The Rise of the Drones needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
No frontier risks strategy
– After analyzing the HBR case study Da Jiang Innovations (DJI): The Rise of the Drones, it seems that company is thinking about the frontier risks that can impact Strategy & Execution strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Da Jiang Innovations (DJI): The Rise of the Drones, is just above the industry average. Dji Drone 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Dji Drone is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Da Jiang Innovations (DJI): The Rise of the Drones can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Slow decision making process
– As mentioned earlier in the report, Dji Drone 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. Dji Drone 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.
Opportunities Da Jiang Innovations (DJI): The Rise of the Drones | 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 Da Jiang Innovations (DJI): The Rise of the Drones are -
Developing new processes and practices
– Dji Drone can develop new processes and procedures in Strategy & Execution 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.
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 Dji Drone 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Strategy & Execution industry, but it has also influenced the consumer preferences. Dji Drone can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Creating value in data economy
– The success of analytics program of Dji Drone has opened avenues for new revenue streams for the organization in the industry. This can help Dji Drone to build a more holistic ecosystem as suggested in the Da Jiang Innovations (DJI): The Rise of the Drones case study. Dji Drone can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Dji Drone to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Dji Drone to hire the very best people irrespective of their geographical location.
Leveraging digital technologies
– Dji Drone 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.
Buying journey improvements
– Dji Drone can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Da Jiang Innovations (DJI): The Rise of the Drones 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 Dji Drone can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Dji Drone can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Dji Drone 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, Da Jiang Innovations (DJI): The Rise of the Drones, 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, Dji Drone is facing challenges because of the dominance of functional experts in the organization. Da Jiang Innovations (DJI): The Rise of the Drones 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.
Using analytics as competitive advantage
– Dji Drone 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 Da Jiang Innovations (DJI): The Rise of the Drones - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Dji Drone to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Strategy & Execution industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Dji Drone 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. Dji Drone 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.
Threats Da Jiang Innovations (DJI): The Rise of the Drones External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Da Jiang Innovations (DJI): The Rise of the Drones are -
Regulatory challenges
– Dji Drone 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 Strategy & Execution industry regulations.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Dji Drone with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Shortening product life cycle
– it is one of the major threat that Dji Drone is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Dji Drone in the Strategy & Execution sector and impact the bottomline of the organization.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Dji Drone 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 Da Jiang Innovations (DJI): The Rise of the Drones .
Consumer confidence and its impact on Dji Drone 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.
Easy access to finance
– Easy access to finance in Strategy & Execution field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Dji Drone can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Dji Drone will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Increasing wage structure of Dji Drone
– 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 Dji Drone.
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.
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 Dji Drone.
Technology acceleration in Forth Industrial Revolution
– Dji Drone has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Dji Drone needs to keep up with the evolution of technology in the Strategy & Execution 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.
Weighted SWOT Analysis of Da Jiang Innovations (DJI): The Rise of the Drones 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 Da Jiang Innovations (DJI): The Rise of the Drones 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 Da Jiang Innovations (DJI): The Rise of the Drones 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 Da Jiang Innovations (DJI): The Rise of the Drones 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 Da Jiang Innovations (DJI): The Rise of the Drones 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 Dji Drone needs to make to build a sustainable competitive advantage.