The End of Scale SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of The End of Scale
For more than a century, economies of scale made the corporation an ideal engine of business. However, the emergence of platforms and technologies that can be rented as needed have eroded the relationship between fixed costs and output that defined economies of scale. Together, these new factors have enabled small companies to pursue niche markets and successfully challenge large established companies that are weighed down by investments in mass production, distribution, and marketing."Investments in scale used to make a lot of sense,"argues author Hemant Taneja. They supported the development of cars, airplanes, radio, and television, and built out the electric grid and telephone system. But with the emergence of mobile, social, cloud computing, and artificial intelligence in recent years, Taneja argues that business logic has shifted toward what he describes as "the economics of unscale,"which allows for mass customization for increasingly narrow markets. Because companies can stay nimble and focused by easily and instantly renting scale, they can adjust quickly to changing demand and conditions with little cost and relatively little effort. According to Taneja, large corporations are taking note. Traditionally, Procter & Gamble Co. invented most of its new products in-house. But in recent years it has started to tap into ideas from outside inventors who submit ideas via the internet. Other large companies, including General Electric Co. and Walmart Stores Inc., are tapping into new, unscaled businesses as well. Taneja presents three recommendations to large companies seeking to remain relevant. His first recommendation is to become a platform. Operating a platform can be enormously profitable because the companies that operate on the platforms come to depend on them for their success. The author's second recommendation is to instill a product focus. Big companies, he argues, get sidetracked on issues that have little to do with making great products. But in an unscaled era, this can create openings for focused small competitors. His third recommendation is to find growth opportunities through what he calls "dynamic rebundling."The winners in the unscaled economy, he writes, "make every customer feel like a market of one."Products and services that are tailored to individuals will often have an advantage over mass-market products and services, Taneja says. Corporations, therefore, can try to maintain their advantage with collections of products from their portfolios that they bundle for particular customers.
Swot Analysis of "The End of Scale" written by Kevin Maney, Hemant Taneja includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Taneja Unscaled facing as an external strategic factors. Some of the topics covered in The End of Scale case study are - Strategic Management Strategies, Technology and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the The End of Scale casestudy better are - – digital marketing is dominated by two big players Facebook and Google, cloud computing is disrupting traditional business models, increasing transportation and logistics costs, increasing household debt because of falling income levels, increasing inequality as vast percentage of new income is going to the top 1%, technology disruption, there is increasing trade war between United States & China,
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 The End of Scale case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Taneja Unscaled, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Taneja Unscaled 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 The End of Scale can be done for the following purposes –
1. Strategic planning using facts provided in The End of Scale case study
2. Improving business portfolio management of Taneja Unscaled
3. Assessing feasibility of the new initiative in Leadership & Managing People field.
4. Making a Leadership & Managing People topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Taneja Unscaled
Strengths The End of Scale | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Taneja Unscaled in The End of Scale Harvard Business Review case study are -
Organizational Resilience of Taneja Unscaled
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Taneja Unscaled does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Cross disciplinary teams
– Horizontal connected teams at the Taneja Unscaled 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.
Ability to lead change in Leadership & Managing People field
– Taneja Unscaled 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 Taneja Unscaled in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Highly skilled collaborators
– Taneja Unscaled 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 The End of Scale HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– Taneja Unscaled has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Taneja Unscaled has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Low bargaining power of suppliers
– Suppliers of Taneja Unscaled in the sector have low bargaining power. The End of Scale has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Taneja Unscaled to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Taneja Unscaled in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Strong track record of project management
– Taneja Unscaled is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High switching costs
– The high switching costs that Taneja Unscaled 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.
Diverse revenue streams
– Taneja Unscaled is present in almost all the verticals within the industry. This has provided firm in The End of Scale 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.
Operational resilience
– The operational resilience strategy in the The End of Scale 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.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Taneja Unscaled digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Taneja Unscaled 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.
Weaknesses The End of Scale | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The End of Scale are -
Low market penetration in new markets
– Outside its home market of Taneja Unscaled, firm in the HBR case study The End of Scale needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Taneja Unscaled is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study The End of Scale can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study The End of Scale, it seems that the employees of Taneja Unscaled 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study The End of Scale, is just above the industry average. Taneja Unscaled 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.
Aligning sales with marketing
– It come across in the case study The End of Scale that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case The End of Scale can leverage the sales team experience to cultivate customer relationships as Taneja Unscaled is planning to shift buying processes online.
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 Taneja Unscaled supply chain. Even after few cautionary changes mentioned in the HBR case study - The End of Scale, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Taneja Unscaled vulnerable to further global disruptions in South East Asia.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study The End of Scale, in the dynamic environment Taneja Unscaled has struggled to respond to the nimble upstart competition. Taneja Unscaled has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
No frontier risks strategy
– After analyzing the HBR case study The End of Scale, it seems that company is thinking about the frontier risks that can impact Leadership & Managing People 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.
Increasing silos among functional specialists
– The organizational structure of Taneja Unscaled is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Taneja Unscaled needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Taneja Unscaled to focus more on services rather than just following the product oriented approach.
High bargaining power of channel partners
– Because of the regulatory requirements, Kevin Maney, Hemant Taneja suggests that, Taneja Unscaled is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Lack of clear differentiation of Taneja Unscaled products
– To increase the profitability and margins on the products, Taneja Unscaled needs to provide more differentiated products than what it is currently offering in the marketplace.
Opportunities The End of Scale | 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 The End of Scale are -
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Taneja Unscaled can use these opportunities to build new business models that can help the communities that Taneja Unscaled operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Taneja Unscaled 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 Taneja Unscaled to hire the very best people irrespective of their geographical location.
Developing new processes and practices
– Taneja Unscaled can develop new processes and procedures in Leadership & Managing People 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.
Better consumer reach
– The expansion of the 5G network will help Taneja Unscaled to increase its market reach. Taneja Unscaled 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Leadership & Managing People industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Taneja Unscaled 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. Taneja Unscaled 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Taneja Unscaled 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Taneja Unscaled is facing challenges because of the dominance of functional experts in the organization. The End of Scale case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Taneja Unscaled in the consumer business. Now Taneja Unscaled can target international markets with far fewer capital restrictions requirements than the existing system.
Learning at scale
– Online learning technologies has now opened space for Taneja Unscaled 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Taneja Unscaled can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Leadership & Managing People industry, but it has also influenced the consumer preferences. Taneja Unscaled 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 Taneja Unscaled has opened avenues for new revenue streams for the organization in the industry. This can help Taneja Unscaled to build a more holistic ecosystem as suggested in the The End of Scale case study. Taneja Unscaled can build new products and services such as - data insight services, data privacy related products, data based consulting services, 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 Taneja Unscaled 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 The End of Scale External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The End of Scale are -
Shortening product life cycle
– it is one of the major threat that Taneja Unscaled is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Taneja Unscaled 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 The End of Scale .
Easy access to finance
– Easy access to finance in Leadership & Managing People field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Taneja Unscaled can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Regulatory challenges
– Taneja Unscaled 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 Leadership & Managing People industry regulations.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Taneja Unscaled with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Taneja Unscaled will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
High dependence on third party suppliers
– Taneja Unscaled 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 Taneja Unscaled in the Leadership & Managing People sector and impact the bottomline of the organization.
Stagnating economy with rate increase
– Taneja Unscaled 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.
Consumer confidence and its impact on Taneja Unscaled 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 Taneja Unscaled business can come under increasing regulations regarding data privacy, data security, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study The End of Scale, Taneja Unscaled may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Leadership & Managing People .
Weighted SWOT Analysis of The End of Scale 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 The End of Scale 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 The End of Scale 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 The End of Scale 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 The End of Scale 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 Taneja Unscaled needs to make to build a sustainable competitive advantage.