Case Study Description of Collage.com: Scaling a Distributed Organization
Kevin Borders and Joe Golden, co-founders and co-CEOs of Collage.com, must decide how to grow their custom photo-products startup in the face of fierce competition. From 2011 through 2016, the business evolved from a hobby to a startup with $22 million in revenue and 45 employees, all of whom worked remotely from home. Customer acquisition was becoming more difficult and repeat purchase rates lagged behind Shutterfly, the industry leader. New hires would help to integrate new products and grow marketing efforts, but several experienced team members wondered whether virtual collaboration could continue to work with an influx of new people.
Swot Analysis of "Collage.com: Scaling a Distributed Organization" written by Christopher Stanton, Shikhar Ghosh includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Collage.com Startup facing as an external strategic factors. Some of the topics covered in Collage.com: Scaling a Distributed Organization case study are - Strategic Management Strategies, Growth strategy, Labor, Organizational structure, Supply chain, Technology and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Collage.com: Scaling a Distributed Organization casestudy better are - – cloud computing is disrupting traditional business models, increasing transportation and logistics costs, digital marketing is dominated by two big players Facebook and Google, increasing government debt because of Covid-19 spendings, there is increasing trade war between United States & China, increasing energy prices, there is backlash against globalization,
increasing household debt because of falling income levels, talent flight as more people leaving formal jobs, etc
Introduction to SWOT Analysis of Collage.com: Scaling a Distributed Organization
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Collage.com: Scaling a Distributed Organization case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Collage.com Startup, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Collage.com Startup 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 Collage.com: Scaling a Distributed Organization can be done for the following purposes –
1. Strategic planning using facts provided in Collage.com: Scaling a Distributed Organization case study
2. Improving business portfolio management of Collage.com Startup
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 Collage.com Startup
Strengths Collage.com: Scaling a Distributed Organization | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Collage.com Startup in Collage.com: Scaling a Distributed Organization Harvard Business Review case study are -
Learning organization
- Collage.com Startup 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 Collage.com Startup is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Collage.com: Scaling a Distributed Organization Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Effective Research and Development (R&D)
– Collage.com Startup 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 Collage.com: Scaling a Distributed Organization - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– Collage.com: Scaling a Distributed Organization firm has clearly differentiated products in the market place. This has enabled Collage.com Startup to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Collage.com Startup to invest into research and development (R&D) and innovation.
Organizational Resilience of Collage.com Startup
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Collage.com Startup does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Successful track record of launching new products
– Collage.com Startup has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Collage.com Startup 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.
Analytics focus
– Collage.com Startup 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 Christopher Stanton, Shikhar Ghosh 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.
Innovation driven organization
– Collage.com Startup is one of the most innovative firm in sector. Manager in Collage.com: Scaling a Distributed Organization Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Ability to recruit top talent
– Collage.com Startup is one of the leading recruiters in the industry. Managers in the Collage.com: Scaling a Distributed Organization are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Training and development
– Collage.com Startup has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Collage.com: Scaling a Distributed Organization 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.
Diverse revenue streams
– Collage.com Startup is present in almost all the verticals within the industry. This has provided firm in Collage.com: Scaling a Distributed Organization 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.
High switching costs
– The high switching costs that Collage.com Startup 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 Collage.com Startup digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Collage.com Startup 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.
Weaknesses Collage.com: Scaling a Distributed Organization | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Collage.com: Scaling a Distributed Organization are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Collage.com: Scaling a Distributed Organization 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 Collage.com Startup has relatively successful track record of launching new products.
No frontier risks strategy
– After analyzing the HBR case study Collage.com: Scaling a Distributed Organization, it seems that company is thinking about the frontier risks that can impact Innovation & Entrepreneurship strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Collage.com: Scaling a Distributed Organization, in the dynamic environment Collage.com Startup has struggled to respond to the nimble upstart competition. Collage.com Startup has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Collage.com Startup supply chain. Even after few cautionary changes mentioned in the HBR case study - Collage.com: Scaling a Distributed Organization, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Collage.com Startup vulnerable to further global disruptions in South East Asia.
Increasing silos among functional specialists
– The organizational structure of Collage.com Startup is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Collage.com Startup needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Collage.com Startup to focus more on services rather than just following the product oriented approach.
Slow decision making process
– As mentioned earlier in the report, Collage.com Startup has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Collage.com Startup even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Skills based hiring
– The stress on hiring functional specialists at Collage.com Startup 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.
Aligning sales with marketing
– It come across in the case study Collage.com: Scaling a Distributed Organization 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 Collage.com: Scaling a Distributed Organization can leverage the sales team experience to cultivate customer relationships as Collage.com Startup is planning to shift buying processes online.
Capital Spending Reduction
– Even during the low interest decade, Collage.com Startup 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.
Lack of clear differentiation of Collage.com Startup products
– To increase the profitability and margins on the products, Collage.com Startup needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Collage.com Startup is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Collage.com: Scaling a Distributed Organization can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities Collage.com: Scaling a Distributed Organization | 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 Collage.com: Scaling a Distributed Organization are -
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 Collage.com Startup 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.
Better consumer reach
– The expansion of the 5G network will help Collage.com Startup to increase its market reach. Collage.com Startup 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.
Using analytics as competitive advantage
– Collage.com Startup 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 Collage.com: Scaling a Distributed Organization - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Collage.com Startup to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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 Collage.com Startup in the consumer business. Now Collage.com Startup can target international markets with far fewer capital restrictions requirements than the existing system.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Collage.com Startup can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Collage.com Startup 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, Collage.com Startup 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, Collage.com: Scaling a Distributed Organization, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Collage.com Startup can use these opportunities to build new business models that can help the communities that Collage.com Startup operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
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. Collage.com Startup 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. Collage.com Startup 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.
Buying journey improvements
– Collage.com Startup can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Collage.com: Scaling a Distributed Organization 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.
Manufacturing automation
– Collage.com Startup 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.
Building a culture of innovation
– managers at Collage.com Startup 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 Innovation & Entrepreneurship segment.
Loyalty marketing
– Collage.com Startup 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.
Threats Collage.com: Scaling a Distributed Organization External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Collage.com: Scaling a Distributed Organization are -
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.
Stagnating economy with rate increase
– Collage.com Startup 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.
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. Collage.com Startup needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.
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 Collage.com Startup in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Shortening product life cycle
– it is one of the major threat that Collage.com Startup is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Collage.com Startup with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Collage.com Startup can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
High dependence on third party suppliers
– Collage.com Startup 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.
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. Collage.com Startup 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 Collage.com Startup
– 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 Collage.com Startup.
Consumer confidence and its impact on Collage.com Startup 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Collage.com: Scaling a Distributed Organization, Collage.com Startup 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 .
Environmental challenges
– Collage.com Startup 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. Collage.com Startup can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
Weighted SWOT Analysis of Collage.com: Scaling a Distributed Organization 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 Collage.com: Scaling a Distributed Organization 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 Collage.com: Scaling a Distributed Organization 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 Collage.com: Scaling a Distributed Organization 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 Collage.com: Scaling a Distributed Organization 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 Collage.com Startup needs to make to build a sustainable competitive advantage.
