Swot Analysis of "The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise" written by Lynda M. Applegate, Ramiro Montealegre, Xiangling Fu includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Wanda Dalian facing as an external strategic factors. Some of the topics covered in The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise case study are - Strategic Management Strategies, and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise casestudy better are - – increasing energy prices, increasing inequality as vast percentage of new income is going to the top 1%, there is increasing trade war between United States & China, supply chains are disrupted by pandemic , increasing transportation and logistics costs, wage bills are increasing, increasing government debt because of Covid-19 spendings,
there is backlash against globalization, increasing commodity prices, etc
Introduction to SWOT Analysis of The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Wanda Dalian, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Wanda Dalian 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 Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise can be done for the following purposes –
1. Strategic planning using facts provided in The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise case study
2. Improving business portfolio management of Wanda Dalian
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 Wanda Dalian
Strengths The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Wanda Dalian in The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise Harvard Business Review case study are -
Successful track record of launching new products
– Wanda Dalian has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Wanda Dalian 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 Wanda Dalian in the sector have low bargaining power. The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Wanda Dalian to manage not only supply disruptions but also source products at highly competitive prices.
Ability to recruit top talent
– Wanda Dalian is one of the leading recruiters in the industry. Managers in the The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Superior customer experience
– The customer experience strategy of Wanda Dalian in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Effective Research and Development (R&D)
– Wanda Dalian 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 The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Training and development
– Wanda Dalian has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise 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.
Strong track record of project management
– Wanda Dalian is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise firm has clearly differentiated products in the market place. This has enabled Wanda Dalian to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Wanda Dalian to invest into research and development (R&D) and innovation.
Innovation driven organization
– Wanda Dalian is one of the most innovative firm in sector. Manager in The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Learning organization
- Wanda Dalian 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 Wanda Dalian is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Wanda Dalian is present in almost all the verticals within the industry. This has provided firm in The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise 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.
Organizational Resilience of Wanda Dalian
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Wanda Dalian does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Wanda Dalian is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise 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, Wanda Dalian 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.
Low market penetration in new markets
– Outside its home market of Wanda Dalian, firm in the HBR case study The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Aligning sales with marketing
– It come across in the case study The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise 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 Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise can leverage the sales team experience to cultivate customer relationships as Wanda Dalian is planning to shift buying processes online.
Increasing silos among functional specialists
– The organizational structure of Wanda Dalian is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Wanda Dalian needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Wanda Dalian to focus more on services rather than just following the product oriented approach.
No frontier risks strategy
– After analyzing the HBR case study The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise, 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.
High operating costs
– Compare to the competitors, firm in the HBR case study The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise 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 Wanda Dalian 's lucrative customers.
Products dominated business model
– Even though Wanda Dalian has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise should strive to include more intangible value offerings along with its core products and services.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise, is just above the industry average. Wanda Dalian 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise 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 Wanda Dalian has relatively successful track record of launching new products.
Workers concerns about automation
– As automation is fast increasing in the segment, Wanda Dalian 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.
Opportunities The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise | 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 Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise are -
Developing new processes and practices
– Wanda Dalian 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.
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. Wanda Dalian can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Innovation & Entrepreneurship industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Wanda Dalian 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. Wanda Dalian 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.
Leveraging digital technologies
– Wanda Dalian 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.
Building a culture of innovation
– managers at Wanda Dalian 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.
Learning at scale
– Online learning technologies has now opened space for Wanda Dalian 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.
Using analytics as competitive advantage
– Wanda Dalian 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 The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Wanda Dalian to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Wanda Dalian is facing challenges because of the dominance of functional experts in the organization. The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Wanda Dalian 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Wanda Dalian 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, The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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 Wanda Dalian 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Wanda Dalian can use these opportunities to build new business models that can help the communities that Wanda Dalian operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
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 Wanda Dalian in the consumer business. Now Wanda Dalian can target international markets with far fewer capital restrictions requirements than the existing system.
Threats The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise are -
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. Wanda Dalian 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Wanda Dalian with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Technology acceleration in Forth Industrial Revolution
– Wanda Dalian has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Wanda Dalian 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.
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 Wanda Dalian.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Wanda Dalian 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.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Increasing wage structure of Wanda Dalian
– 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 Wanda Dalian.
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.
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 Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise, Wanda Dalian 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 .
High dependence on third party suppliers
– Wanda Dalian 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.
Consumer confidence and its impact on Wanda Dalian 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.
Stagnating economy with rate increase
– Wanda Dalian 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.
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 Wanda Dalian in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Weighted SWOT Analysis of The Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise 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 Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise 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 Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise 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 Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise 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 Dalian Wanda Group: Using IT to Become an Asset-Light, Service-Oriented Enterprise 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 Wanda Dalian needs to make to build a sustainable competitive advantage.
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