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 - – digital marketing is dominated by two big players Facebook and Google, geopolitical disruptions, cloud computing is disrupting traditional business models, competitive advantages are harder to sustain because of technology dispersion, talent flight as more people leaving formal jobs, technology disruption, supply chains are disrupted by pandemic ,
increasing transportation and logistics costs, there is increasing trade war between United States & China, 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 -
Ability to recruit top talent
– Linkfluence Actsocial is one of the leading recruiters in the industry. Managers in the Linkfluence: Building on ActSocial's Relationships are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Diverse revenue streams
– Linkfluence Actsocial is present in almost all the verticals within the industry. This has provided firm in Linkfluence: Building on ActSocial's Relationships 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 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.
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.
Organizational Resilience of Linkfluence Actsocial
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Linkfluence Actsocial does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– Linkfluence Actsocial has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Linkfluence: Building on ActSocial's Relationships 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.
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.
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.
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.
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.
Operational resilience
– The operational resilience strategy in the Linkfluence: Building on ActSocial's Relationships 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.
Low bargaining power of suppliers
– Suppliers of Linkfluence Actsocial in the sector have low bargaining power. Linkfluence: Building on ActSocial's Relationships has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Linkfluence Actsocial to manage not only supply disruptions but also source products at highly competitive prices.
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.
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 Linkfluence Actsocial supply chain. Even after few cautionary changes mentioned in the HBR case study - Linkfluence: Building on ActSocial's Relationships, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Linkfluence Actsocial vulnerable to further global disruptions in South East Asia.
Workers concerns about automation
– As automation is fast increasing in the segment, Linkfluence Actsocial 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.
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.
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.
High operating costs
– Compare to the competitors, firm in the HBR case study Linkfluence: Building on ActSocial's Relationships 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 Linkfluence Actsocial 's lucrative customers.
Need for greater diversity
– Linkfluence Actsocial 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.
High cash cycle compare to competitors
Linkfluence Actsocial has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Linkfluence: Building on ActSocial's Relationships, in the dynamic environment Linkfluence Actsocial has struggled to respond to the nimble upstart competition. Linkfluence Actsocial has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
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.
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.
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 -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Linkfluence Actsocial is facing challenges because of the dominance of functional experts in the organization. Linkfluence: Building on ActSocial's Relationships 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.
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.
Developing new processes and practices
– Linkfluence Actsocial can develop new processes and procedures in Innovation & Entrepreneurship industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Linkfluence Actsocial in the consumer business. Now Linkfluence Actsocial can target international markets with far fewer capital restrictions requirements than the existing system.
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.
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.
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.
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.
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.
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. Linkfluence Actsocial can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Building a culture of innovation
– managers at Linkfluence Actsocial 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 Innovation & Entrepreneurship segment.
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 Linkfluence Actsocial 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.
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 -
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.
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.
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.
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 .
Stagnating economy with rate increase
– Linkfluence Actsocial can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
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.
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.
Shortening product life cycle
– it is one of the major threat that Linkfluence Actsocial is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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.
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 Linkfluence Actsocial.
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.
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.
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.