Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study SWOT Analysis Solution
Case Study Description of Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn
An Estonian success story, this case examines why Skype's Scandinavian founders chose Tallinn to establish their hi-tech start-up. We investigate the factors that contributed to their choice of location and the subsequent success of the venture. Skype's journey is discussed against the backdrop of post-Soviet Estonia's economic and industrial resurrection.
Swot Analysis of "Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn" written by Sami Mahroum, Elizabeth Scott includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Tallinn Estonian facing as an external strategic factors. Some of the topics covered in Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn case study are - Strategic Management Strategies, Economics, Entrepreneurship, Influence, Innovation, Technology and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn casestudy better are - – increasing government debt because of Covid-19 spendings, supply chains are disrupted by pandemic , geopolitical disruptions, customer relationship management is fast transforming because of increasing concerns over data privacy, competitive advantages are harder to sustain because of technology dispersion, increasing commodity prices, banking and financial system is disrupted by Bitcoin and other crypto currencies,
there is increasing trade war between United States & China, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Tallinn Estonian, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Tallinn Estonian 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 Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn can be done for the following purposes –
1. Strategic planning using facts provided in Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn case study
2. Improving business portfolio management of Tallinn Estonian
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 Tallinn Estonian
Strengths Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Tallinn Estonian in Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn Harvard Business Review case study are -
High brand equity
– Tallinn Estonian has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Tallinn Estonian to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn firm has clearly differentiated products in the market place. This has enabled Tallinn Estonian to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Tallinn Estonian to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Tallinn Estonian 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.
Superior customer experience
– The customer experience strategy of Tallinn Estonian in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Innovation driven organization
– Tallinn Estonian is one of the most innovative firm in sector. Manager in Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Ability to lead change in Innovation & Entrepreneurship field
– Tallinn Estonian 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 Tallinn Estonian in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Highly skilled collaborators
– Tallinn Estonian 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 Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Training and development
– Tallinn Estonian has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn 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.
Low bargaining power of suppliers
– Suppliers of Tallinn Estonian in the sector have low bargaining power. Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Tallinn Estonian to manage not only supply disruptions but also source products at highly competitive prices.
Learning organization
- Tallinn Estonian 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 Tallinn Estonian is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Successful track record of launching new products
– Tallinn Estonian has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Tallinn Estonian 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
– Tallinn Estonian 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 Sami Mahroum, Elizabeth Scott 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.
Weaknesses Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn are -
High bargaining power of channel partners
– Because of the regulatory requirements, Sami Mahroum, Elizabeth Scott suggests that, Tallinn Estonian 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.
Interest costs
– Compare to the competition, Tallinn Estonian 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.
Skills based hiring
– The stress on hiring functional specialists at Tallinn Estonian 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 Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn 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 Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn can leverage the sales team experience to cultivate customer relationships as Tallinn Estonian is planning to shift buying processes online.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn, is just above the industry average. Tallinn Estonian 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.
Lack of clear differentiation of Tallinn Estonian products
– To increase the profitability and margins on the products, Tallinn Estonian needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow decision making process
– As mentioned earlier in the report, Tallinn Estonian 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. Tallinn Estonian 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.
Slow to strategic competitive environment developments
– As Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn HBR case study mentions - Tallinn Estonian 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.
Increasing silos among functional specialists
– The organizational structure of Tallinn Estonian is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Tallinn Estonian needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Tallinn Estonian to focus more on services rather than just following the product oriented approach.
Low market penetration in new markets
– Outside its home market of Tallinn Estonian, firm in the HBR case study Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
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 Tallinn Estonian supply chain. Even after few cautionary changes mentioned in the HBR case study - Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Tallinn Estonian vulnerable to further global disruptions in South East Asia.
Opportunities Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn | 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 Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Tallinn Estonian 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 Tallinn Estonian to hire the very best people irrespective of their geographical location.
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. Tallinn Estonian can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Creating value in data economy
– The success of analytics program of Tallinn Estonian has opened avenues for new revenue streams for the organization in the industry. This can help Tallinn Estonian to build a more holistic ecosystem as suggested in the Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn case study. Tallinn Estonian can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
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. Tallinn Estonian can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Better consumer reach
– The expansion of the 5G network will help Tallinn Estonian to increase its market reach. Tallinn Estonian 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Tallinn Estonian is facing challenges because of the dominance of functional experts in the organization. Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn 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.
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. Tallinn Estonian 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. Tallinn Estonian 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
– Tallinn Estonian 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Tallinn Estonian can use these opportunities to build new business models that can help the communities that Tallinn Estonian operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Using analytics as competitive advantage
– Tallinn Estonian 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 Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Tallinn Estonian 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 Tallinn Estonian 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
– Tallinn Estonian 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Tallinn Estonian 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.
Threats Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn are -
Stagnating economy with rate increase
– Tallinn Estonian 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.
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. Tallinn Estonian 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.
Regulatory challenges
– Tallinn Estonian 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.
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. Tallinn Estonian needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.
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. Tallinn Estonian 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, Tallinn Estonian 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 Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn .
Increasing wage structure of Tallinn Estonian
– 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 Tallinn Estonian.
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 Tallinn Estonian business can come under increasing regulations regarding data privacy, data security, etc.
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 Tallinn Estonian.
Environmental challenges
– Tallinn Estonian 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. Tallinn Estonian can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Tallinn Estonian 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
– Tallinn Estonian has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Tallinn Estonian 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.
Weighted SWOT Analysis of Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn 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 Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn 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 Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn 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 Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn 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 Skype: A Case Study of How Skype Derived "Place Surplus" in the Estonian Capital of Tallinn 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 Tallinn Estonian needs to make to build a sustainable competitive advantage.
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