IT-Ration's Quest for Growth: A Market Choice Challenge SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of IT-Ration's Quest for Growth: A Market Choice Challenge
This case uses the story of IT-Ration, a small firm based in Montreal, Quebec, Canada, to enable students to conduct an in-depth analysis of the founding manager, the firm, and the industry so as to make a strategic growth decision. The story unfolds in 2009 at a time when IT-Ration was at a crossroads - should it continue to focus on the Quebec market or go into the U.S. in order to grow? Remaining in Quebec meant that the business would face problems related to limited market size. However, a move to the U.S. would also bring its share of challenges. The entrepreneur had to weigh the pros and cons in order to make an informed decision.
Authors :: Mai Thi Thanh Thai, Ekaterina Turkina, Khuong Lenguyen
Swot Analysis of "IT-Ration's Quest for Growth: A Market Choice Challenge" written by Mai Thi Thanh Thai, Ekaterina Turkina, Khuong Lenguyen includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Quebec Ration facing as an external strategic factors. Some of the topics covered in IT-Ration's Quest for Growth: A Market Choice Challenge case study are - Strategic Management Strategies, Entrepreneurship, Motivating people and Global Business.
Some of the macro environment factors that can be used to understand the IT-Ration's Quest for Growth: A Market Choice Challenge casestudy better are - – increasing energy prices, increasing household debt because of falling income levels, wage bills are increasing, digital marketing is dominated by two big players Facebook and Google, increasing commodity prices, there is increasing trade war between United States & China, central banks are concerned over increasing inflation,
customer relationship management is fast transforming because of increasing concerns over data privacy, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of IT-Ration's Quest for Growth: A Market Choice Challenge
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in IT-Ration's Quest for Growth: A Market Choice Challenge case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Quebec Ration, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Quebec Ration 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 IT-Ration's Quest for Growth: A Market Choice Challenge can be done for the following purposes –
1. Strategic planning using facts provided in IT-Ration's Quest for Growth: A Market Choice Challenge case study
2. Improving business portfolio management of Quebec Ration
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 Quebec Ration
Strengths IT-Ration's Quest for Growth: A Market Choice Challenge | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Quebec Ration in IT-Ration's Quest for Growth: A Market Choice Challenge Harvard Business Review case study are -
Ability to recruit top talent
– Quebec Ration is one of the leading recruiters in the industry. Managers in the IT-Ration's Quest for Growth: A Market Choice Challenge are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Sustainable margins compare to other players in Global Business industry
– IT-Ration's Quest for Growth: A Market Choice Challenge firm has clearly differentiated products in the market place. This has enabled Quebec Ration to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Quebec Ration to invest into research and development (R&D) and innovation.
Innovation driven organization
– Quebec Ration is one of the most innovative firm in sector. Manager in IT-Ration's Quest for Growth: A Market Choice Challenge Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Low bargaining power of suppliers
– Suppliers of Quebec Ration in the sector have low bargaining power. IT-Ration's Quest for Growth: A Market Choice Challenge has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Quebec Ration to manage not only supply disruptions but also source products at highly competitive prices.
Diverse revenue streams
– Quebec Ration is present in almost all the verticals within the industry. This has provided firm in IT-Ration's Quest for Growth: A Market Choice Challenge 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.
Superior customer experience
– The customer experience strategy of Quebec Ration in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Successful track record of launching new products
– Quebec Ration has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Quebec Ration 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.
Training and development
– Quebec Ration has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in IT-Ration's Quest for Growth: A Market Choice Challenge 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.
Cross disciplinary teams
– Horizontal connected teams at the Quebec Ration 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.
Highly skilled collaborators
– Quebec Ration 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 IT-Ration's Quest for Growth: A Market Choice Challenge HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High switching costs
– The high switching costs that Quebec Ration 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.
High brand equity
– Quebec Ration has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Quebec Ration to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses IT-Ration's Quest for Growth: A Market Choice Challenge | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of IT-Ration's Quest for Growth: A Market Choice Challenge are -
Products dominated business model
– Even though Quebec Ration 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 - IT-Ration's Quest for Growth: A Market Choice Challenge should strive to include more intangible value offerings along with its core products and services.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the IT-Ration's Quest for Growth: A Market Choice Challenge 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 Quebec Ration has relatively successful track record of launching new products.
Need for greater diversity
– Quebec Ration 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.
Aligning sales with marketing
– It come across in the case study IT-Ration's Quest for Growth: A Market Choice Challenge 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 IT-Ration's Quest for Growth: A Market Choice Challenge can leverage the sales team experience to cultivate customer relationships as Quebec Ration is planning to shift buying processes online.
Lack of clear differentiation of Quebec Ration products
– To increase the profitability and margins on the products, Quebec Ration needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow decision making process
– As mentioned earlier in the report, Quebec Ration 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. Quebec Ration 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study IT-Ration's Quest for Growth: A Market Choice Challenge, in the dynamic environment Quebec Ration has struggled to respond to the nimble upstart competition. Quebec Ration has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Increasing silos among functional specialists
– The organizational structure of Quebec Ration is dominated by functional specialists. It is not different from other players in the Global Business segment. Quebec Ration needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Quebec Ration to focus more on services rather than just following the product oriented approach.
No frontier risks strategy
– After analyzing the HBR case study IT-Ration's Quest for Growth: A Market Choice Challenge, 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.
Capital Spending Reduction
– Even during the low interest decade, Quebec Ration 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.
Skills based hiring
– The stress on hiring functional specialists at Quebec Ration has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Opportunities IT-Ration's Quest for Growth: A Market Choice Challenge | 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 IT-Ration's Quest for Growth: A Market Choice Challenge are -
Creating value in data economy
– The success of analytics program of Quebec Ration has opened avenues for new revenue streams for the organization in the industry. This can help Quebec Ration to build a more holistic ecosystem as suggested in the IT-Ration's Quest for Growth: A Market Choice Challenge case study. Quebec Ration can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Quebec Ration can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. IT-Ration's Quest for Growth: A Market Choice Challenge 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.
Developing new processes and practices
– Quebec Ration 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.
Loyalty marketing
– Quebec Ration 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Quebec Ration 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, IT-Ration's Quest for Growth: A Market Choice Challenge, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Quebec Ration 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 Quebec Ration to hire the very best people irrespective of their geographical location.
Learning at scale
– Online learning technologies has now opened space for Quebec Ration 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Quebec Ration can use these opportunities to build new business models that can help the communities that Quebec Ration operates in. Secondly it can use opportunities from government spending in Global Business sector.
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. Quebec Ration can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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. Quebec Ration 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. Quebec Ration 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.
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 Quebec Ration in the consumer business. Now Quebec Ration can target international markets with far fewer capital restrictions requirements than the existing system.
Low interest rates
– Even though inflation is raising its head in most developed economies, Quebec Ration 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Global Business industry, but it has also influenced the consumer preferences. Quebec Ration can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats IT-Ration's Quest for Growth: A Market Choice Challenge External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study IT-Ration's Quest for Growth: A Market Choice Challenge are -
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. Quebec Ration can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Quebec Ration 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 IT-Ration's Quest for Growth: A Market Choice Challenge .
Shortening product life cycle
– it is one of the major threat that Quebec Ration is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Consumer confidence and its impact on Quebec Ration 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.
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 IT-Ration's Quest for Growth: A Market Choice Challenge, Quebec Ration 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 .
Environmental challenges
– Quebec Ration 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. Quebec Ration can take advantage of this fund but it will also bring new competitors in the Global Business industry.
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 Quebec Ration.
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. Quebec Ration 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 Quebec Ration business can come under increasing regulations regarding data privacy, data security, 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.
Technology acceleration in Forth Industrial Revolution
– Quebec Ration has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Quebec Ration 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 wage structure of Quebec Ration
– 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 Quebec Ration.
Weighted SWOT Analysis of IT-Ration's Quest for Growth: A Market Choice Challenge 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 IT-Ration's Quest for Growth: A Market Choice Challenge 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 IT-Ration's Quest for Growth: A Market Choice Challenge 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 IT-Ration's Quest for Growth: A Market Choice Challenge 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 IT-Ration's Quest for Growth: A Market Choice Challenge 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 Quebec Ration needs to make to build a sustainable competitive advantage.