Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo
Famous for the hit game "Angry Birds", game developer and entertainment company Rovio is an example of outstanding entrepreneurship. This case analyses the factors that made its base in Espoo, Finland, an attractive place and contributed to the start-up's overall success as it became a world leader in mobile gaming.
Swot Analysis of "Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo" written by Sami Mahroum, Elizabeth Scott includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Rovio Espoo facing as an external strategic factors. Some of the topics covered in Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo case study are - Strategic Management Strategies, Entrepreneurship, Ethics, Influence, Technology and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo casestudy better are - – increasing energy prices, increasing commodity prices, supply chains are disrupted by pandemic , increasing government debt because of Covid-19 spendings, wage bills are increasing, central banks are concerned over increasing inflation, there is increasing trade war between United States & China,
cloud computing is disrupting traditional business models, there is backlash against globalization, etc
Introduction to SWOT Analysis of Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Rovio Espoo, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Rovio Espoo 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 Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo can be done for the following purposes –
1. Strategic planning using facts provided in Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo case study
2. Improving business portfolio management of Rovio Espoo
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 Rovio Espoo
Strengths Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Rovio Espoo in Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo Harvard Business Review case study are -
High brand equity
– Rovio Espoo has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Rovio Espoo to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to recruit top talent
– Rovio Espoo is one of the leading recruiters in the industry. Managers in the Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Innovation driven organization
– Rovio Espoo is one of the most innovative firm in sector. Manager in Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
High switching costs
– The high switching costs that Rovio Espoo 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.
Successful track record of launching new products
– Rovio Espoo has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Rovio Espoo 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.
Superior customer experience
– The customer experience strategy of Rovio Espoo in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to lead change in Innovation & Entrepreneurship field
– Rovio Espoo 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 Rovio Espoo in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Learning organization
- Rovio Espoo 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 Rovio Espoo is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Rovio Espoo is present in almost all the verticals within the industry. This has provided firm in Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo 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.
Effective Research and Development (R&D)
– Rovio Espoo 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 Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Training and development
– Rovio Espoo has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo 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.
Analytics focus
– Rovio Espoo 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 Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo are -
Slow decision making process
– As mentioned earlier in the report, Rovio Espoo 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. Rovio Espoo 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.
Products dominated business model
– Even though Rovio Espoo 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 - Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo should strive to include more intangible value offerings along with its core products and services.
Need for greater diversity
– Rovio Espoo 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.
Increasing silos among functional specialists
– The organizational structure of Rovio Espoo is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Rovio Espoo needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Rovio Espoo to focus more on services rather than just following the product oriented approach.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo 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 Rovio Espoo has relatively successful track record of launching new products.
Aligning sales with marketing
– It come across in the case study Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo 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 Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo can leverage the sales team experience to cultivate customer relationships as Rovio Espoo is planning to shift buying processes online.
Slow to strategic competitive environment developments
– As Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo HBR case study mentions - Rovio Espoo takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
High cash cycle compare to competitors
Rovio Espoo has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Interest costs
– Compare to the competition, Rovio Espoo 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.
No frontier risks strategy
– After analyzing the HBR case study Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo, 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Rovio Espoo is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo 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 Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo | 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 Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo are -
Leveraging digital technologies
– Rovio Espoo 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Rovio Espoo 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, Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo, 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 Rovio Espoo to increase its market reach. Rovio Espoo 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.
Creating value in data economy
– The success of analytics program of Rovio Espoo has opened avenues for new revenue streams for the organization in the industry. This can help Rovio Espoo to build a more holistic ecosystem as suggested in the Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo case study. Rovio Espoo can build new products and services such as - data insight services, data privacy related products, data based consulting services, 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 Rovio Espoo 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.
Buying journey improvements
– Rovio Espoo can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo 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 Rovio Espoo 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.
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 Rovio Espoo in the consumer business. Now Rovio Espoo can target international markets with far fewer capital restrictions requirements than the existing system.
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. Rovio Espoo 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. Rovio Espoo 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.
Building a culture of innovation
– managers at Rovio Espoo 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Rovio Espoo 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 Rovio Espoo to hire the very best people irrespective of their geographical location.
Using analytics as competitive advantage
– Rovio Espoo 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 Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Rovio Espoo to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Learning at scale
– Online learning technologies has now opened space for Rovio Espoo 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.
Threats Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo are -
Increasing wage structure of Rovio Espoo
– 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 Rovio Espoo.
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 Rovio Espoo.
Consumer confidence and its impact on Rovio Espoo 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Rovio Espoo 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 Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo .
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.
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 Rovio Espoo business can come under increasing regulations regarding data privacy, data security, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Rovio Espoo 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.
Shortening product life cycle
– it is one of the major threat that Rovio Espoo 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. Rovio Espoo 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.
High dependence on third party suppliers
– Rovio Espoo high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Technology acceleration in Forth Industrial Revolution
– Rovio Espoo has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Rovio Espoo 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.
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. Rovio Espoo can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Regulatory challenges
– Rovio Espoo 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.
Weighted SWOT Analysis of Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo 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 Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo 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 Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo 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 Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo 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 Rovio Entertainment: A Case Study of How Rovio Derived "Place Surplus" in the Finnish City of Espoo 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 Rovio Espoo needs to make to build a sustainable competitive advantage.
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