Case Study Description of Funskool India: Defend, Lead, and Counter Rivals
In April 2017, the chief executive officer of Funskool India Limited (Funskool), was formulating a growth strategy to increase the company's annual revenues from 1.9 billion in 2016 to 5 billion by 2020. The Indian toy manufacturer had primarily catered to the local market while also exporting toys to developed markets. In 2006, the company expanded its line of products, set up an exclusive design department to develop new products, redesigned its advertising and promotional activities, and expanded into retail outlets. However, Chinese importers were upgrading and moving up the product segment ladder, where Funskool had a strong presence, and video games, which Funskool did not produce, were seeing exponential growth. How could Funskool augment the revenue obtained from the sale of its own brands? With Chinese competitors targeting consumers higher up the segment, should Funskool target customers in the lower economic levels? Should it enter the digital space to prevent a growth stall and catapult itself to the next stage in the growth cycle? The company needed to make some decisions and take steps to face these emerging challenges. Rakesh Gupta is affiliated with Institute of Management Technology, Ghaziabad. Sandeep Puri is affiliated with Asian Institute of Management.
Swot Analysis of "Funskool India: Defend, Lead, and Counter Rivals" written by Rakesh Gupta, Valiaparampil Joseph Sebastian, Sandeep Puri, Kirthivasan Sathya Narayanan includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Funskool 20b9 facing as an external strategic factors. Some of the topics covered in Funskool India: Defend, Lead, and Counter Rivals case study are - Strategic Management Strategies, Growth strategy, Manufacturing and Global Business.
Some of the macro environment factors that can be used to understand the Funskool India: Defend, Lead, and Counter Rivals casestudy better are - – increasing energy prices, geopolitical disruptions, increasing household debt because of falling income levels, technology disruption, digital marketing is dominated by two big players Facebook and Google, there is backlash against globalization, banking and financial system is disrupted by Bitcoin and other crypto currencies,
competitive advantages are harder to sustain because of technology dispersion, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
Introduction to SWOT Analysis of Funskool India: Defend, Lead, and Counter Rivals
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Funskool India: Defend, Lead, and Counter Rivals case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Funskool 20b9, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Funskool 20b9 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 Funskool India: Defend, Lead, and Counter Rivals can be done for the following purposes –
1. Strategic planning using facts provided in Funskool India: Defend, Lead, and Counter Rivals case study
2. Improving business portfolio management of Funskool 20b9
3. Assessing feasibility of the new initiative in Global Business field.
4. Making a Global Business topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Funskool 20b9
Strengths Funskool India: Defend, Lead, and Counter Rivals | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Funskool 20b9 in Funskool India: Defend, Lead, and Counter Rivals Harvard Business Review case study are -
Learning organization
- Funskool 20b9 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 Funskool 20b9 is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Funskool India: Defend, Lead, and Counter Rivals Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Organizational Resilience of Funskool 20b9
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Funskool 20b9 does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Funskool 20b9 digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Funskool 20b9 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 Funskool India: Defend, Lead, and Counter Rivals 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.
Successful track record of launching new products
– Funskool 20b9 has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Funskool 20b9 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.
Highly skilled collaborators
– Funskool 20b9 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 Funskool India: Defend, Lead, and Counter Rivals HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Diverse revenue streams
– Funskool 20b9 is present in almost all the verticals within the industry. This has provided firm in Funskool India: Defend, Lead, and Counter Rivals 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.
Innovation driven organization
– Funskool 20b9 is one of the most innovative firm in sector. Manager in Funskool India: Defend, Lead, and Counter Rivals Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Superior customer experience
– The customer experience strategy of Funskool 20b9 in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the Funskool 20b9 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.
Effective Research and Development (R&D)
– Funskool 20b9 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 Funskool India: Defend, Lead, and Counter Rivals - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to recruit top talent
– Funskool 20b9 is one of the leading recruiters in the industry. Managers in the Funskool India: Defend, Lead, and Counter Rivals 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 Funskool India: Defend, Lead, and Counter Rivals | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Funskool India: Defend, Lead, and Counter Rivals are -
Increasing silos among functional specialists
– The organizational structure of Funskool 20b9 is dominated by functional specialists. It is not different from other players in the Global Business segment. Funskool 20b9 needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Funskool 20b9 to focus more on services rather than just following the product oriented approach.
Aligning sales with marketing
– It come across in the case study Funskool India: Defend, Lead, and Counter Rivals 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 Funskool India: Defend, Lead, and Counter Rivals can leverage the sales team experience to cultivate customer relationships as Funskool 20b9 is planning to shift buying processes online.
Low market penetration in new markets
– Outside its home market of Funskool 20b9, firm in the HBR case study Funskool India: Defend, Lead, and Counter Rivals needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Funskool India: Defend, Lead, and Counter Rivals 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 Funskool 20b9 has relatively successful track record of launching new products.
No frontier risks strategy
– After analyzing the HBR case study Funskool India: Defend, Lead, and Counter Rivals, it seems that company is thinking about the frontier risks that can impact Global Business 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Rakesh Gupta, Valiaparampil Joseph Sebastian, Sandeep Puri, Kirthivasan Sathya Narayanan suggests that, Funskool 20b9 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 Funskool 20b9 products
– To increase the profitability and margins on the products, Funskool 20b9 needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to strategic competitive environment developments
– As Funskool India: Defend, Lead, and Counter Rivals HBR case study mentions - Funskool 20b9 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.
Slow decision making process
– As mentioned earlier in the report, Funskool 20b9 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. Funskool 20b9 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.
Capital Spending Reduction
– Even during the low interest decade, Funskool 20b9 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Funskool India: Defend, Lead, and Counter Rivals, it seems that the employees of Funskool 20b9 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.
Opportunities Funskool India: Defend, Lead, and Counter Rivals | 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 Funskool India: Defend, Lead, and Counter Rivals are -
Better consumer reach
– The expansion of the 5G network will help Funskool 20b9 to increase its market reach. Funskool 20b9 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Funskool 20b9 is facing challenges because of the dominance of functional experts in the organization. Funskool India: Defend, Lead, and Counter Rivals 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Global Business industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Funskool 20b9 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. Funskool 20b9 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Funskool 20b9 can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Building a culture of innovation
– managers at Funskool 20b9 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 Global Business segment.
Loyalty marketing
– Funskool 20b9 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Funskool 20b9 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.
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. Funskool 20b9 can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Learning at scale
– Online learning technologies has now opened space for Funskool 20b9 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.
Leveraging digital technologies
– Funskool 20b9 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
– Funskool 20b9 can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Funskool India: Defend, Lead, and Counter Rivals 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Funskool 20b9 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 Funskool 20b9 to hire the very best people irrespective of their geographical location.
Developing new processes and practices
– Funskool 20b9 can develop new processes and procedures in Global Business 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.
Threats Funskool India: Defend, Lead, and Counter Rivals External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Funskool India: Defend, Lead, and Counter Rivals are -
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Funskool 20b9 needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Funskool 20b9 in the Global Business industry. The Global Business 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Funskool India: Defend, Lead, and Counter Rivals, Funskool 20b9 may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Global Business .
Increasing wage structure of Funskool 20b9
– 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 Funskool 20b9.
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. Funskool 20b9 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.
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 Funskool 20b9 business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Funskool 20b9 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.
Shortening product life cycle
– it is one of the major threat that Funskool 20b9 is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
High dependence on third party suppliers
– Funskool 20b9 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.
Environmental challenges
– Funskool 20b9 needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Funskool 20b9 can take advantage of this fund but it will also bring new competitors in the Global Business industry.
Technology acceleration in Forth Industrial Revolution
– Funskool 20b9 has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Funskool 20b9 needs to keep up with the evolution of technology in the Global Business 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Funskool 20b9 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 Funskool India: Defend, Lead, and Counter Rivals .
Easy access to finance
– Easy access to finance in Global Business field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Funskool 20b9 can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of Funskool India: Defend, Lead, and Counter Rivals 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 Funskool India: Defend, Lead, and Counter Rivals 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 Funskool India: Defend, Lead, and Counter Rivals 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 Funskool India: Defend, Lead, and Counter Rivals 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 Funskool India: Defend, Lead, and Counter Rivals 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 Funskool 20b9 needs to make to build a sustainable competitive advantage.