Swot Analysis of "Cellular Service" written by Pai-Ling Yin, Abigail Tinker includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Cellular Friends facing as an external strategic factors. Some of the topics covered in Cellular Service case study are - Strategic Management Strategies, and Communication.
Some of the macro environment factors that can be used to understand the Cellular Service casestudy better are - – digital marketing is dominated by two big players Facebook and Google, there is increasing trade war between United States & China, increasing commodity prices, competitive advantages are harder to sustain because of technology dispersion, talent flight as more people leaving formal jobs, increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies,
customer relationship management is fast transforming because of increasing concerns over data privacy, wage bills are increasing, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Cellular Service case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Cellular Friends, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Cellular Friends 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 Cellular Service can be done for the following purposes –
1. Strategic planning using facts provided in Cellular Service case study
2. Improving business portfolio management of Cellular Friends
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 Cellular Friends
Strengths Cellular Service | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Cellular Friends in Cellular Service Harvard Business Review case study are -
Highly skilled collaborators
– Cellular Friends 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 Cellular Service HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Effective Research and Development (R&D)
– Cellular Friends 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 Cellular Service - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Digital Transformation in Communication segment
- digital transformation varies from industry to industry. For Cellular Friends digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Cellular Friends 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.
High brand equity
– Cellular Friends has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Cellular Friends to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Cellular Friends is present in almost all the verticals within the industry. This has provided firm in Cellular Service 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 Cellular Friends
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Cellular Friends does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– Cellular Friends has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Cellular Service 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.
Ability to recruit top talent
– Cellular Friends is one of the leading recruiters in the industry. Managers in the Cellular Service are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Strong track record of project management
– Cellular Friends is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Learning organization
- Cellular Friends 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 Cellular Friends is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Cellular Service Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Analytics focus
– Cellular Friends 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 Pai-Ling Yin, Abigail Tinker 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.
Sustainable margins compare to other players in Communication industry
– Cellular Service firm has clearly differentiated products in the market place. This has enabled Cellular Friends to fetch slight price premium compare to the competitors in the Communication industry. The sustainable margins have also helped Cellular Friends to invest into research and development (R&D) and innovation.
Weaknesses Cellular Service | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Cellular Service are -
Skills based hiring
– The stress on hiring functional specialists at Cellular Friends 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Cellular Service, is just above the industry average. Cellular Friends 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.
Need for greater diversity
– Cellular Friends 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.
Products dominated business model
– Even though Cellular Friends 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 - Cellular Service should strive to include more intangible value offerings along with its core products and services.
Interest costs
– Compare to the competition, Cellular Friends 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.
Slow to strategic competitive environment developments
– As Cellular Service HBR case study mentions - Cellular Friends 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.
Low market penetration in new markets
– Outside its home market of Cellular Friends, firm in the HBR case study Cellular Service needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High operating costs
– Compare to the competitors, firm in the HBR case study Cellular Service 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 Cellular Friends 's lucrative customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Cellular Friends 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.
High cash cycle compare to competitors
Cellular Friends has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
High bargaining power of channel partners
– Because of the regulatory requirements, Pai-Ling Yin, Abigail Tinker suggests that, Cellular Friends 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.
Opportunities Cellular Service | 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 Cellular Service are -
Buying journey improvements
– Cellular Friends can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Cellular Service 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.
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 Cellular Friends in the consumer business. Now Cellular Friends can target international markets with far fewer capital restrictions requirements than the existing system.
Creating value in data economy
– The success of analytics program of Cellular Friends has opened avenues for new revenue streams for the organization in the industry. This can help Cellular Friends to build a more holistic ecosystem as suggested in the Cellular Service case study. Cellular Friends can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Learning at scale
– Online learning technologies has now opened space for Cellular Friends 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.
Loyalty marketing
– Cellular Friends 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Cellular Friends 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.
Better consumer reach
– The expansion of the 5G network will help Cellular Friends to increase its market reach. Cellular Friends 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Cellular Friends 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 Cellular Friends to hire the very best people irrespective of their geographical location.
Using analytics as competitive advantage
– Cellular Friends 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 Cellular Service - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Cellular Friends to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Cellular Friends 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, Cellular Service, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Cellular Friends can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Cellular Friends can use these opportunities to build new business models that can help the communities that Cellular Friends operates in. Secondly it can use opportunities from government spending in Communication sector.
Building a culture of innovation
– managers at Cellular Friends 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.
Threats Cellular Service External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Cellular Service are -
Technology acceleration in Forth Industrial Revolution
– Cellular Friends has witnessed rapid integration of technology during Covid-19 in the Communication industry. As one of the leading players in the industry, Cellular Friends 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.
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. Cellular Friends can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Consumer confidence and its impact on Cellular Friends 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Cellular Friends with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Stagnating economy with rate increase
– Cellular Friends 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.
Regulatory challenges
– Cellular Friends needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Communication industry regulations.
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 Cellular Friends.
Increasing wage structure of Cellular Friends
– 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 Cellular Friends.
Environmental challenges
– Cellular Friends 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. Cellular Friends can take advantage of this fund but it will also bring new competitors in the Communication industry.
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 Cellular Friends business can come under increasing regulations regarding data privacy, data security, etc.
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. Cellular Friends needs to understand the core reasons impacting the Communication 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 Cellular Friends in the Communication industry. The Communication 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.
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. Cellular Friends 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.
Weighted SWOT Analysis of Cellular Service 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 Cellular Service 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 Cellular Service 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 Cellular Service 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 Cellular Service 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 Cellular Friends needs to make to build a sustainable competitive advantage.
