Virginia Craftsmen, Inc. SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Communication
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Virginia Craftsmen, Inc.
This case is intended to help students understand the complexities in selling or attempting to turn around an unprofitable business. Some of the issues involved are: (1) valuing a private company that has lost money for several years and has few tangible assets, (2) controlling costs and developing pricing strategies, (3) key factors necessary to turn around a cash-poor private company.
Swot Analysis of "Virginia Craftsmen, Inc." written by C. Ray Smith, James Sowers includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Craftsmen Tangible facing as an external strategic factors. Some of the topics covered in Virginia Craftsmen, Inc. case study are - Strategic Management Strategies, and Communication.
Some of the macro environment factors that can be used to understand the Virginia Craftsmen, Inc. casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing transportation and logistics costs, competitive advantages are harder to sustain because of technology dispersion, central banks are concerned over increasing inflation, challanges to central banks by blockchain based private currencies, digital marketing is dominated by two big players Facebook and Google, supply chains are disrupted by pandemic ,
increasing government debt because of Covid-19 spendings, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Virginia Craftsmen, Inc.
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Virginia Craftsmen, Inc. case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Craftsmen Tangible, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Craftsmen Tangible 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 Virginia Craftsmen, Inc. can be done for the following purposes –
1. Strategic planning using facts provided in Virginia Craftsmen, Inc. case study
2. Improving business portfolio management of Craftsmen Tangible
3. Assessing feasibility of the new initiative in Communication field.
4. Making a Communication topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Craftsmen Tangible
Strengths Virginia Craftsmen, Inc. | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Craftsmen Tangible in Virginia Craftsmen, Inc. Harvard Business Review case study are -
Analytics focus
– Craftsmen Tangible is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by C. Ray Smith, James Sowers can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Ability to lead change in Communication field
– Craftsmen Tangible 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 Craftsmen Tangible in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Strong track record of project management
– Craftsmen Tangible is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Operational resilience
– The operational resilience strategy in the Virginia Craftsmen, Inc. 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.
Superior customer experience
– The customer experience strategy of Craftsmen Tangible in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Digital Transformation in Communication segment
- digital transformation varies from industry to industry. For Craftsmen Tangible digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Craftsmen Tangible 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.
Highly skilled collaborators
– Craftsmen Tangible 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 Virginia Craftsmen, Inc. HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Learning organization
- Craftsmen Tangible 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 Craftsmen Tangible is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Virginia Craftsmen, Inc. Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Craftsmen Tangible is present in almost all the verticals within the industry. This has provided firm in Virginia Craftsmen, Inc. 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.
High brand equity
– Craftsmen Tangible has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Craftsmen Tangible to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Effective Research and Development (R&D)
– Craftsmen Tangible 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 Virginia Craftsmen, Inc. - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Sustainable margins compare to other players in Communication industry
– Virginia Craftsmen, Inc. firm has clearly differentiated products in the market place. This has enabled Craftsmen Tangible to fetch slight price premium compare to the competitors in the Communication industry. The sustainable margins have also helped Craftsmen Tangible to invest into research and development (R&D) and innovation.
Weaknesses Virginia Craftsmen, Inc. | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Virginia Craftsmen, Inc. are -
Low market penetration in new markets
– Outside its home market of Craftsmen Tangible, firm in the HBR case study Virginia Craftsmen, Inc. needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Virginia Craftsmen, Inc., in the dynamic environment Craftsmen Tangible has struggled to respond to the nimble upstart competition. Craftsmen Tangible has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Virginia Craftsmen, Inc., it seems that the employees of Craftsmen Tangible 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.
Lack of clear differentiation of Craftsmen Tangible products
– To increase the profitability and margins on the products, Craftsmen Tangible needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Craftsmen Tangible is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Virginia Craftsmen, Inc. can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Slow decision making process
– As mentioned earlier in the report, Craftsmen Tangible 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. Craftsmen Tangible 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Virginia Craftsmen, Inc. 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 Craftsmen Tangible 's lucrative customers.
Need for greater diversity
– Craftsmen Tangible 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.
Increasing silos among functional specialists
– The organizational structure of Craftsmen Tangible is dominated by functional specialists. It is not different from other players in the Communication segment. Craftsmen Tangible needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Craftsmen Tangible to focus more on services rather than just following the product oriented approach.
Workers concerns about automation
– As automation is fast increasing in the segment, Craftsmen Tangible 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.
Interest costs
– Compare to the competition, Craftsmen Tangible 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.
Opportunities Virginia Craftsmen, Inc. | 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 Virginia Craftsmen, Inc. are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Craftsmen Tangible 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 Craftsmen Tangible to hire the very best people irrespective of their geographical location.
Developing new processes and practices
– Craftsmen Tangible can develop new processes and procedures in Communication 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Craftsmen Tangible 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, Virginia Craftsmen, Inc., to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Creating value in data economy
– The success of analytics program of Craftsmen Tangible has opened avenues for new revenue streams for the organization in the industry. This can help Craftsmen Tangible to build a more holistic ecosystem as suggested in the Virginia Craftsmen, Inc. case study. Craftsmen Tangible can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– Craftsmen Tangible 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 Virginia Craftsmen, Inc. - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Craftsmen Tangible to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Leveraging digital technologies
– Craftsmen Tangible 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.
Better consumer reach
– The expansion of the 5G network will help Craftsmen Tangible to increase its market reach. Craftsmen Tangible 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Craftsmen Tangible in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Communication segment, and it will provide faster access to the consumers.
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 Craftsmen Tangible in the consumer business. Now Craftsmen Tangible can target international markets with far fewer capital restrictions requirements than the existing system.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Craftsmen Tangible can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Craftsmen Tangible is facing challenges because of the dominance of functional experts in the organization. Virginia Craftsmen, Inc. 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.
Building a culture of innovation
– managers at Craftsmen Tangible 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 Communication segment.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Communication industry, but it has also influenced the consumer preferences. Craftsmen Tangible can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats Virginia Craftsmen, Inc. External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Virginia Craftsmen, Inc. are -
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 Craftsmen Tangible in the Communication sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Craftsmen Tangible 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
– Craftsmen Tangible 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. Craftsmen Tangible can take advantage of this fund but it will also bring new competitors in the Communication industry.
Consumer confidence and its impact on Craftsmen Tangible 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.
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. Craftsmen Tangible 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 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. Craftsmen Tangible needs to understand the core reasons impacting the Communication industry. This will help it in building a better workplace.
Stagnating economy with rate increase
– Craftsmen Tangible 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.
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.
Easy access to finance
– Easy access to finance in Communication field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Craftsmen Tangible can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Virginia Craftsmen, Inc., Craftsmen Tangible may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Communication .
Increasing wage structure of Craftsmen Tangible
– 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 Craftsmen Tangible.
Technology acceleration in Forth Industrial Revolution
– Craftsmen Tangible has witnessed rapid integration of technology during Covid-19 in the Communication industry. As one of the leading players in the industry, Craftsmen Tangible needs to keep up with the evolution of technology in the Communication 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.
Weighted SWOT Analysis of Virginia Craftsmen, Inc. 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 Virginia Craftsmen, Inc. 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 Virginia Craftsmen, Inc. 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 Virginia Craftsmen, Inc. 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 Virginia Craftsmen, Inc. 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 Craftsmen Tangible needs to make to build a sustainable competitive advantage.
