Linkfluence: Building on ActSocial's Relationships SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Linkfluence: Building on ActSocial's Relationships
Founded in 2008 in Singapore and China, ActSocial was a social marketing company that initially provided brands with word-of-mouth (WOM) marketing services. The firm then adjusted its model to focus on providing online social media and digital content marketing services. After significant success from 2013 to 2015, ActSocial was fully acquired by Linkfluence, a leading global social media monitoring and research company. As part of this larger company, the new leadership team at Linkfluence Asia now needed to decide how to proceed and wondered if they would have influence over the direction of their product, hiring decisions, team-building, and growth plans.
Swot Analysis of "Linkfluence: Building on ActSocial's Relationships" written by Jeff Chai, Wei Lu, Darren Meister includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Linkfluence Actsocial facing as an external strategic factors. Some of the topics covered in Linkfluence: Building on ActSocial's Relationships case study are - Strategic Management Strategies, Social platforms and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Linkfluence: Building on ActSocial's Relationships casestudy better are - – there is increasing trade war between United States & China, central banks are concerned over increasing inflation, supply chains are disrupted by pandemic , increasing inequality as vast percentage of new income is going to the top 1%, wage bills are increasing, increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies,
competitive advantages are harder to sustain because of technology dispersion, geopolitical disruptions, etc
Introduction to SWOT Analysis of Linkfluence: Building on ActSocial's Relationships
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Linkfluence: Building on ActSocial's Relationships case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Linkfluence Actsocial, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Linkfluence Actsocial 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 Linkfluence: Building on ActSocial's Relationships can be done for the following purposes –
1. Strategic planning using facts provided in Linkfluence: Building on ActSocial's Relationships case study
2. Improving business portfolio management of Linkfluence Actsocial
3. Assessing feasibility of the new initiative in Innovation & Entrepreneurship field.
4. Making a Innovation & Entrepreneurship topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Linkfluence Actsocial
Strengths Linkfluence: Building on ActSocial's Relationships | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Linkfluence Actsocial in Linkfluence: Building on ActSocial's Relationships Harvard Business Review case study are -
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– Linkfluence: Building on ActSocial's Relationships firm has clearly differentiated products in the market place. This has enabled Linkfluence Actsocial to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Linkfluence Actsocial to invest into research and development (R&D) and innovation.
High brand equity
– Linkfluence Actsocial has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Linkfluence Actsocial to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Effective Research and Development (R&D)
– Linkfluence Actsocial 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 Linkfluence: Building on ActSocial's Relationships - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Digital Transformation in Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Linkfluence Actsocial digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Linkfluence Actsocial 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.
Learning organization
- Linkfluence Actsocial 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 Linkfluence Actsocial is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Linkfluence: Building on ActSocial's Relationships Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Linkfluence Actsocial are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
High switching costs
– The high switching costs that Linkfluence Actsocial 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.
Superior customer experience
– The customer experience strategy of Linkfluence Actsocial in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Innovation driven organization
– Linkfluence Actsocial is one of the most innovative firm in sector. Manager in Linkfluence: Building on ActSocial's Relationships Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Ability to lead change in Innovation & Entrepreneurship field
– Linkfluence Actsocial 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 Linkfluence Actsocial in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Successful track record of launching new products
– Linkfluence Actsocial has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Linkfluence Actsocial 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.
Strong track record of project management
– Linkfluence Actsocial is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses Linkfluence: Building on ActSocial's Relationships | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Linkfluence: Building on ActSocial's Relationships are -
Increasing silos among functional specialists
– The organizational structure of Linkfluence Actsocial is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Linkfluence Actsocial needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Linkfluence Actsocial to focus more on services rather than just following the product oriented approach.
Slow decision making process
– As mentioned earlier in the report, Linkfluence Actsocial 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. Linkfluence Actsocial 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Linkfluence: Building on ActSocial's Relationships, it seems that the employees of Linkfluence Actsocial 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Linkfluence Actsocial is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Linkfluence: Building on ActSocial's Relationships can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Interest costs
– Compare to the competition, Linkfluence Actsocial has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Skills based hiring
– The stress on hiring functional specialists at Linkfluence Actsocial 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.
Slow to strategic competitive environment developments
– As Linkfluence: Building on ActSocial's Relationships HBR case study mentions - Linkfluence Actsocial 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.
Lack of clear differentiation of Linkfluence Actsocial products
– To increase the profitability and margins on the products, Linkfluence Actsocial 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 Linkfluence: Building on ActSocial's Relationships, is just above the industry average. Linkfluence Actsocial 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.
No frontier risks strategy
– After analyzing the HBR case study Linkfluence: Building on ActSocial's Relationships, it seems that company is thinking about the frontier risks that can impact Innovation & Entrepreneurship 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.
Capital Spending Reduction
– Even during the low interest decade, Linkfluence Actsocial 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.
Opportunities Linkfluence: Building on ActSocial's Relationships | 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 Linkfluence: Building on ActSocial's Relationships are -
Using analytics as competitive advantage
– Linkfluence Actsocial 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 Linkfluence: Building on ActSocial's Relationships - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Linkfluence Actsocial to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Linkfluence Actsocial in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Innovation & Entrepreneurship segment, and it will provide faster access to the consumers.
Low interest rates
– Even though inflation is raising its head in most developed economies, Linkfluence Actsocial 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.
Creating value in data economy
– The success of analytics program of Linkfluence Actsocial has opened avenues for new revenue streams for the organization in the industry. This can help Linkfluence Actsocial to build a more holistic ecosystem as suggested in the Linkfluence: Building on ActSocial's Relationships case study. Linkfluence Actsocial can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Better consumer reach
– The expansion of the 5G network will help Linkfluence Actsocial to increase its market reach. Linkfluence Actsocial will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Linkfluence Actsocial can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Linkfluence Actsocial in the consumer business. Now Linkfluence Actsocial can target international markets with far fewer capital restrictions requirements than the existing system.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Linkfluence Actsocial 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 Linkfluence Actsocial to hire the very best people irrespective of their geographical location.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Linkfluence Actsocial can use these opportunities to build new business models that can help the communities that Linkfluence Actsocial operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Learning at scale
– Online learning technologies has now opened space for Linkfluence Actsocial 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Linkfluence Actsocial 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, Linkfluence: Building on ActSocial's Relationships, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Loyalty marketing
– Linkfluence Actsocial 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Innovation & Entrepreneurship industry, but it has also influenced the consumer preferences. Linkfluence Actsocial can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats Linkfluence: Building on ActSocial's Relationships External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Linkfluence: Building on ActSocial's Relationships are -
Technology acceleration in Forth Industrial Revolution
– Linkfluence Actsocial has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Linkfluence Actsocial needs to keep up with the evolution of technology in the Innovation & Entrepreneurship 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Linkfluence Actsocial in the Innovation & Entrepreneurship industry. The Innovation & Entrepreneurship 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.
Easy access to finance
– Easy access to finance in Innovation & Entrepreneurship field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Linkfluence Actsocial 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 Linkfluence Actsocial.
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 Linkfluence Actsocial business can come under increasing regulations regarding data privacy, data security, etc.
Regulatory challenges
– Linkfluence Actsocial 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 Innovation & Entrepreneurship industry regulations.
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. Linkfluence Actsocial 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.
Consumer confidence and its impact on Linkfluence Actsocial 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.
High dependence on third party suppliers
– Linkfluence Actsocial 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.
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 Linkfluence Actsocial in the Innovation & Entrepreneurship 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 Linkfluence: Building on ActSocial's Relationships, Linkfluence Actsocial may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Innovation & Entrepreneurship .
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.
Increasing wage structure of Linkfluence Actsocial
– 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 Linkfluence Actsocial.
Weighted SWOT Analysis of Linkfluence: Building on ActSocial's Relationships 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 Linkfluence: Building on ActSocial's Relationships 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 Linkfluence: Building on ActSocial's Relationships 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 Linkfluence: Building on ActSocial's Relationships 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 Linkfluence: Building on ActSocial's Relationships 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 Linkfluence Actsocial needs to make to build a sustainable competitive advantage.
