Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics
Innovation and the management of intellectual capital are playing an increasingly important role in competition in high-technology industries. To operate in markets where innovation is cumulative, such as in electronics and semiconductors, firms frequently need to engage in extensive licensing and cross-licensing. This need is amplified by recent increases in the strength of patent protection and by the more active licensing stance of intellectual property owners. A high-quality patent portfolio not only reflects the firm's inventive capacity, but may significantly increase its cross-licensing bargaining ability and reduce royalty payments. In addition, it may directly contribute to its product and process innovation.
Swot Analysis of "Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics" written by Peter C. Grindley, David J. Teece includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Licensing Intellectual facing as an external strategic factors. Some of the topics covered in Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics case study are - Strategic Management Strategies, Innovation, Intellectual property and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics casestudy better are - – there is increasing trade war between United States & China, wage bills are increasing, increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies, technology disruption, talent flight as more people leaving formal jobs, increasing commodity prices,
increasing inequality as vast percentage of new income is going to the top 1%, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Licensing Intellectual, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Licensing Intellectual 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 Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics can be done for the following purposes –
1. Strategic planning using facts provided in Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics case study
2. Improving business portfolio management of Licensing Intellectual
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 Licensing Intellectual
Strengths Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Licensing Intellectual in Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics Harvard Business Review case study are -
Effective Research and Development (R&D)
– Licensing Intellectual 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 Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Highly skilled collaborators
– Licensing Intellectual 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 Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to lead change in Innovation & Entrepreneurship field
– Licensing Intellectual 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 Licensing Intellectual in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Analytics focus
– Licensing Intellectual 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 Peter C. Grindley, David J. Teece 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.
Operational resilience
– The operational resilience strategy in the Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics 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.
Ability to recruit top talent
– Licensing Intellectual is one of the leading recruiters in the industry. Managers in the Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics 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 Innovation & Entrepreneurship industry
– Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics firm has clearly differentiated products in the market place. This has enabled Licensing Intellectual to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Licensing Intellectual to invest into research and development (R&D) and innovation.
High switching costs
– The high switching costs that Licensing Intellectual 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.
Diverse revenue streams
– Licensing Intellectual is present in almost all the verticals within the industry. This has provided firm in Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics 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.
Digital Transformation in Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Licensing Intellectual digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Licensing Intellectual 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.
Learning organization
- Licensing Intellectual 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 Licensing Intellectual is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Superior customer experience
– The customer experience strategy of Licensing Intellectual in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics are -
Slow to strategic competitive environment developments
– As Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics HBR case study mentions - Licensing Intellectual 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.
Interest costs
– Compare to the competition, Licensing Intellectual 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.
Need for greater diversity
– Licensing Intellectual 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.
Lack of clear differentiation of Licensing Intellectual products
– To increase the profitability and margins on the products, Licensing Intellectual needs to provide more differentiated products than what it is currently offering in the marketplace.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics, is just above the industry average. Licensing Intellectual 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Licensing Intellectual is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Capital Spending Reduction
– Even during the low interest decade, Licensing Intellectual 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics 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 Licensing Intellectual has relatively successful track record of launching new products.
Increasing silos among functional specialists
– The organizational structure of Licensing Intellectual is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Licensing Intellectual needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Licensing Intellectual to focus more on services rather than just following the product oriented approach.
Low market penetration in new markets
– Outside its home market of Licensing Intellectual, firm in the HBR case study Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Aligning sales with marketing
– It come across in the case study Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics 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 Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics can leverage the sales team experience to cultivate customer relationships as Licensing Intellectual is planning to shift buying processes online.
Opportunities Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics | 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 Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Licensing Intellectual can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Licensing Intellectual 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, Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Better consumer reach
– The expansion of the 5G network will help Licensing Intellectual to increase its market reach. Licensing Intellectual 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Licensing Intellectual 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 Innovation & Entrepreneurship industry, but it has also influenced the consumer preferences. Licensing Intellectual can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Licensing Intellectual is facing challenges because of the dominance of functional experts in the organization. Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics 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.
Learning at scale
– Online learning technologies has now opened space for Licensing Intellectual 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.
Leveraging digital technologies
– Licensing Intellectual 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.
Buying journey improvements
– Licensing Intellectual can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Licensing Intellectual 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Innovation & Entrepreneurship industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Licensing Intellectual 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. Licensing Intellectual 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.
Developing new processes and practices
– Licensing Intellectual can develop new processes and procedures in Innovation & Entrepreneurship industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
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 Licensing Intellectual 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.
Threats Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics are -
High dependence on third party suppliers
– Licensing Intellectual 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.
Shortening product life cycle
– it is one of the major threat that Licensing Intellectual is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Licensing Intellectual 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Licensing Intellectual in the Innovation & Entrepreneurship industry. The Innovation & Entrepreneurship industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
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.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Licensing Intellectual with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Technology acceleration in Forth Industrial Revolution
– Licensing Intellectual has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Licensing Intellectual 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics, Licensing Intellectual 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 .
Stagnating economy with rate increase
– Licensing Intellectual can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Licensing Intellectual in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
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 Licensing Intellectual business can come under increasing regulations regarding data privacy, data security, etc.
Increasing wage structure of Licensing Intellectual
– 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 Licensing Intellectual.
Weighted SWOT Analysis of Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics 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 Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics 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 Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics 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 Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics 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 Managing Intellectual Capital: Licensing and Cross-Licensing in Semiconductors and Electronics 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 Licensing Intellectual needs to make to build a sustainable competitive advantage.
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