Recounts the story of how Katrina Garnett single-handedly launched CrossWorlds, a successful enterprise application company. Focuses on two issues Garnett must wrestle with as she tries to manage her board of directors. The CrossWorlds board cautiously and slowly pursued the idea of an initial public offering, wanting to achieve more revenue traction before accessing the public markets. Unfortunately, the company was at a disadvantage because it recognized revenue using conservative guidelines: Instead of recognizing revenue when payment was received, CrossWorlds recognized revenue when the product "went live" at a customer site. Garnett's competitors used more aggressive methods, claiming higher revenues, and therefore, entering the public markets earlier. Also, Garnett felt that having a prominent investment banker on her board was limiting her options. Many investment banks refused even to meet with CrossWorlds because they simply assumed that the business would go to the board member's firm. Garnett was also frustrated with this board member's inability to transcend a banker's mind-set.
Swot Analysis of "Katrina Garnett" written by Garth Saloner, Emily Melton includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Garnett Crossworlds facing as an external strategic factors. Some of the topics covered in Katrina Garnett case study are - Strategic Management Strategies, IPO, Leadership and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Katrina Garnett casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, supply chains are disrupted by pandemic , cloud computing is disrupting traditional business models, there is backlash against globalization, increasing transportation and logistics costs, talent flight as more people leaving formal jobs, increasing commodity prices,
competitive advantages are harder to sustain because of technology dispersion, increasing energy prices, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Katrina Garnett case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Garnett Crossworlds, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Garnett Crossworlds 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 Katrina Garnett can be done for the following purposes –
1. Strategic planning using facts provided in Katrina Garnett case study
2. Improving business portfolio management of Garnett Crossworlds
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 Garnett Crossworlds
Strengths Katrina Garnett | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Garnett Crossworlds in Katrina Garnett Harvard Business Review case study are -
Effective Research and Development (R&D)
– Garnett Crossworlds 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 Katrina Garnett - 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
– Garnett Crossworlds has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Katrina Garnett 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.
Organizational Resilience of Garnett Crossworlds
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Garnett Crossworlds does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Strong track record of project management
– Garnett Crossworlds is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Low bargaining power of suppliers
– Suppliers of Garnett Crossworlds in the sector have low bargaining power. Katrina Garnett has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Garnett Crossworlds to manage not only supply disruptions but also source products at highly competitive prices.
Successful track record of launching new products
– Garnett Crossworlds has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Garnett Crossworlds 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.
Ability to recruit top talent
– Garnett Crossworlds is one of the leading recruiters in the industry. Managers in the Katrina Garnett are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
High brand equity
– Garnett Crossworlds has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Garnett Crossworlds to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Digital Transformation in Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Garnett Crossworlds digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Garnett Crossworlds 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.
Analytics focus
– Garnett Crossworlds 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 Garth Saloner, Emily Melton 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 Innovation & Entrepreneurship industry
– Katrina Garnett firm has clearly differentiated products in the market place. This has enabled Garnett Crossworlds to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Garnett Crossworlds to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Garnett Crossworlds 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.
Weaknesses Katrina Garnett | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Katrina Garnett are -
Lack of clear differentiation of Garnett Crossworlds products
– To increase the profitability and margins on the products, Garnett Crossworlds needs to provide more differentiated products than what it is currently offering in the marketplace.
Workers concerns about automation
– As automation is fast increasing in the segment, Garnett Crossworlds 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.
Increasing silos among functional specialists
– The organizational structure of Garnett Crossworlds is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Garnett Crossworlds needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Garnett Crossworlds to focus more on services rather than just following the product oriented approach.
Skills based hiring
– The stress on hiring functional specialists at Garnett Crossworlds 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Katrina Garnett, it seems that the employees of Garnett Crossworlds 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.
Slow to strategic competitive environment developments
– As Katrina Garnett HBR case study mentions - Garnett Crossworlds 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Garth Saloner, Emily Melton suggests that, Garnett Crossworlds 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.
Low market penetration in new markets
– Outside its home market of Garnett Crossworlds, firm in the HBR case study Katrina Garnett 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 Katrina Garnett 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 Garnett Crossworlds 's lucrative customers.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Katrina Garnett 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 Garnett Crossworlds has relatively successful track record of launching new products.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Katrina Garnett, is just above the industry average. Garnett Crossworlds 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.
Opportunities Katrina Garnett | 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 Katrina Garnett are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Garnett Crossworlds can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Using analytics as competitive advantage
– Garnett Crossworlds 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 Katrina Garnett - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Garnett Crossworlds to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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 Garnett Crossworlds 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.
Leveraging digital technologies
– Garnett Crossworlds 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.
Loyalty marketing
– Garnett Crossworlds 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.
Learning at scale
– Online learning technologies has now opened space for Garnett Crossworlds 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Garnett Crossworlds in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Innovation & Entrepreneurship segment, and it will provide faster access to the consumers.
Better consumer reach
– The expansion of the 5G network will help Garnett Crossworlds to increase its market reach. Garnett Crossworlds 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.
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 Garnett Crossworlds in the consumer business. Now Garnett Crossworlds 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 Garnett Crossworlds has opened avenues for new revenue streams for the organization in the industry. This can help Garnett Crossworlds to build a more holistic ecosystem as suggested in the Katrina Garnett case study. Garnett Crossworlds can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Garnett Crossworlds 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 Garnett Crossworlds to hire the very best people irrespective of their geographical location.
Low interest rates
– Even though inflation is raising its head in most developed economies, Garnett Crossworlds 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Garnett Crossworlds can use these opportunities to build new business models that can help the communities that Garnett Crossworlds operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Threats Katrina Garnett External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Katrina Garnett are -
Stagnating economy with rate increase
– Garnett Crossworlds can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Shortening product life cycle
– it is one of the major threat that Garnett Crossworlds is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Easy access to finance
– Easy access to finance in Innovation & Entrepreneurship field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Garnett Crossworlds 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, Garnett Crossworlds 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 Katrina Garnett .
High dependence on third party suppliers
– Garnett Crossworlds 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.
Technology acceleration in Forth Industrial Revolution
– Garnett Crossworlds has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Garnett Crossworlds 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 Garnett Crossworlds.
Regulatory challenges
– Garnett Crossworlds 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 Innovation & Entrepreneurship industry regulations.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Katrina Garnett, Garnett Crossworlds 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 .
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. Garnett Crossworlds 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.
Increasing wage structure of Garnett Crossworlds
– 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 Garnett Crossworlds.
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.
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.
Weighted SWOT Analysis of Katrina Garnett 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 Katrina Garnett 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 Katrina Garnett 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 Katrina Garnett 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 Katrina Garnett 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 Garnett Crossworlds needs to make to build a sustainable competitive advantage.
