Case Study Description of Palm Computing, Inc.--1995: Financing Challenges
The president, Donna Dubinsky, and the chairman and founder, Jeff Hawkins, discuss an opportunity to sell their company to U.S. Robotics. They must weigh this option versus accepting venture capital funding, partnering with a large company that could provide distribution channels and capital, or continuing a search for capital from other sources.
Swot Analysis of "Palm Computing, Inc.--1995: Financing Challenges" written by Myra M. Hart, Stephanie Dodson includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Dubinsky Donna facing as an external strategic factors. Some of the topics covered in Palm Computing, Inc.--1995: Financing Challenges case study are - Strategic Management Strategies, Joint ventures, Technology, Venture capital and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Palm Computing, Inc.--1995: Financing Challenges casestudy better are - – cloud computing is disrupting traditional business models, talent flight as more people leaving formal jobs, banking and financial system is disrupted by Bitcoin and other crypto currencies, competitive advantages are harder to sustain because of technology dispersion, there is increasing trade war between United States & China, digital marketing is dominated by two big players Facebook and Google, increasing energy prices,
geopolitical disruptions, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of Palm Computing, Inc.--1995: Financing Challenges
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Palm Computing, Inc.--1995: Financing Challenges case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Dubinsky Donna, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Dubinsky Donna 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 Palm Computing, Inc.--1995: Financing Challenges can be done for the following purposes –
1. Strategic planning using facts provided in Palm Computing, Inc.--1995: Financing Challenges case study
2. Improving business portfolio management of Dubinsky Donna
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 Dubinsky Donna
Strengths Palm Computing, Inc.--1995: Financing Challenges | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Dubinsky Donna in Palm Computing, Inc.--1995: Financing Challenges Harvard Business Review case study are -
Strong track record of project management
– Dubinsky Donna is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Effective Research and Development (R&D)
– Dubinsky Donna 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 Palm Computing, Inc.--1995: Financing Challenges - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Organizational Resilience of Dubinsky Donna
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Dubinsky Donna does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Highly skilled collaborators
– Dubinsky Donna 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 Palm Computing, Inc.--1995: Financing Challenges HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Superior customer experience
– The customer experience strategy of Dubinsky Donna in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High brand equity
– Dubinsky Donna has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Dubinsky Donna to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to recruit top talent
– Dubinsky Donna is one of the leading recruiters in the industry. Managers in the Palm Computing, Inc.--1995: Financing Challenges are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Diverse revenue streams
– Dubinsky Donna is present in almost all the verticals within the industry. This has provided firm in Palm Computing, Inc.--1995: Financing Challenges 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.
Cross disciplinary teams
– Horizontal connected teams at the Dubinsky Donna 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.
High switching costs
– The high switching costs that Dubinsky Donna 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.
Digital Transformation in Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Dubinsky Donna digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Dubinsky Donna 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.
Low bargaining power of suppliers
– Suppliers of Dubinsky Donna in the sector have low bargaining power. Palm Computing, Inc.--1995: Financing Challenges has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Dubinsky Donna to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses Palm Computing, Inc.--1995: Financing Challenges | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Palm Computing, Inc.--1995: Financing Challenges are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Palm Computing, Inc.--1995: Financing Challenges 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 Dubinsky Donna has relatively successful track record of launching new products.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Palm Computing, Inc.--1995: Financing Challenges, is just above the industry average. Dubinsky Donna 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.
Interest costs
– Compare to the competition, Dubinsky Donna 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 harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Dubinsky Donna is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Palm Computing, Inc.--1995: Financing Challenges can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Increasing silos among functional specialists
– The organizational structure of Dubinsky Donna is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Dubinsky Donna needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Dubinsky Donna to focus more on services rather than just following the product oriented approach.
Aligning sales with marketing
– It come across in the case study Palm Computing, Inc.--1995: Financing Challenges 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 Palm Computing, Inc.--1995: Financing Challenges can leverage the sales team experience to cultivate customer relationships as Dubinsky Donna is planning to shift buying processes online.
Lack of clear differentiation of Dubinsky Donna products
– To increase the profitability and margins on the products, Dubinsky Donna needs to provide more differentiated products than what it is currently offering in the marketplace.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Palm Computing, Inc.--1995: Financing Challenges, it seems that the employees of Dubinsky Donna 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.
Products dominated business model
– Even though Dubinsky Donna 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 - Palm Computing, Inc.--1995: Financing Challenges should strive to include more intangible value offerings along with its core products and services.
High bargaining power of channel partners
– Because of the regulatory requirements, Myra M. Hart, Stephanie Dodson suggests that, Dubinsky Donna 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.
Capital Spending Reduction
– Even during the low interest decade, Dubinsky Donna 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.
Opportunities Palm Computing, Inc.--1995: Financing Challenges | 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 Palm Computing, Inc.--1995: Financing Challenges are -
Low interest rates
– Even though inflation is raising its head in most developed economies, Dubinsky Donna 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.
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 Dubinsky Donna in the consumer business. Now Dubinsky Donna can target international markets with far fewer capital restrictions requirements than the existing system.
Using analytics as competitive advantage
– Dubinsky Donna 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 Palm Computing, Inc.--1995: Financing Challenges - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Dubinsky Donna to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Dubinsky Donna 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. Dubinsky Donna 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.
Better consumer reach
– The expansion of the 5G network will help Dubinsky Donna to increase its market reach. Dubinsky Donna 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.
Manufacturing automation
– Dubinsky Donna can use the latest technology developments to improve its manufacturing and designing process in Innovation & Entrepreneurship segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Dubinsky Donna 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 Dubinsky Donna to hire the very best people irrespective of their geographical location.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Dubinsky Donna can use these opportunities to build new business models that can help the communities that Dubinsky Donna operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
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 Dubinsky Donna 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.
Loyalty marketing
– Dubinsky Donna 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.
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. Dubinsky Donna 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, Dubinsky Donna is facing challenges because of the dominance of functional experts in the organization. Palm Computing, Inc.--1995: Financing Challenges 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Dubinsky Donna can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Palm Computing, Inc.--1995: Financing Challenges External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Palm Computing, Inc.--1995: Financing Challenges are -
Technology acceleration in Forth Industrial Revolution
– Dubinsky Donna has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Dubinsky Donna 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.
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 Dubinsky Donna 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. Dubinsky Donna needs to understand the core reasons impacting the Innovation & Entrepreneurship 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 Dubinsky Donna 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Palm Computing, Inc.--1995: Financing Challenges, Dubinsky Donna 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 .
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. Dubinsky Donna can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Dubinsky Donna in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
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.
High dependence on third party suppliers
– Dubinsky Donna high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Environmental challenges
– Dubinsky Donna 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. Dubinsky Donna can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
Consumer confidence and its impact on Dubinsky Donna 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.
Regulatory challenges
– Dubinsky Donna 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Dubinsky Donna 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 Palm Computing, Inc.--1995: Financing Challenges .
Weighted SWOT Analysis of Palm Computing, Inc.--1995: Financing Challenges 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 Palm Computing, Inc.--1995: Financing Challenges 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 Palm Computing, Inc.--1995: Financing Challenges 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 Palm Computing, Inc.--1995: Financing Challenges 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 Palm Computing, Inc.--1995: Financing Challenges 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 Dubinsky Donna needs to make to build a sustainable competitive advantage.