Describes a recent Berkeley MBA's attempts to start a business aimed at corporate training via the Internet. Describes the very early efforts at finding an attorney, accountant, and financing, and the interrelationships among these choices.
Authors :: William A. Sahlman, Michael J. Roberts, Christina Darwall
Swot Analysis of "DigitalThink: Startup" written by William A. Sahlman, Michael J. Roberts, Christina Darwall includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Digitalthink Interrelationships facing as an external strategic factors. Some of the topics covered in DigitalThink: Startup case study are - Strategic Management Strategies, Employee retention, Growth strategy, Internet, Recession, Venture capital and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the DigitalThink: Startup casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, increasing government debt because of Covid-19 spendings, wage bills are increasing, central banks are concerned over increasing inflation, customer relationship management is fast transforming because of increasing concerns over data privacy, cloud computing is disrupting traditional business models, there is backlash against globalization,
there is increasing trade war between United States & China, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of DigitalThink: Startup
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in DigitalThink: Startup case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Digitalthink Interrelationships, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Digitalthink Interrelationships 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 DigitalThink: Startup can be done for the following purposes –
1. Strategic planning using facts provided in DigitalThink: Startup case study
2. Improving business portfolio management of Digitalthink Interrelationships
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 Digitalthink Interrelationships
Strengths DigitalThink: Startup | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Digitalthink Interrelationships in DigitalThink: Startup Harvard Business Review case study are -
Ability to lead change in Innovation & Entrepreneurship field
– Digitalthink Interrelationships 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 Digitalthink Interrelationships in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Digital Transformation in Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Digitalthink Interrelationships digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Digitalthink Interrelationships 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.
Innovation driven organization
– Digitalthink Interrelationships is one of the most innovative firm in sector. Manager in DigitalThink: Startup Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– DigitalThink: Startup firm has clearly differentiated products in the market place. This has enabled Digitalthink Interrelationships to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Digitalthink Interrelationships to invest into research and development (R&D) and innovation.
Analytics focus
– Digitalthink Interrelationships 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 William A. Sahlman, Michael J. Roberts, Christina Darwall can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Operational resilience
– The operational resilience strategy in the DigitalThink: Startup Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Low bargaining power of suppliers
– Suppliers of Digitalthink Interrelationships in the sector have low bargaining power. DigitalThink: Startup has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Digitalthink Interrelationships to manage not only supply disruptions but also source products at highly competitive prices.
Training and development
– Digitalthink Interrelationships has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in DigitalThink: Startup 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
– Digitalthink Interrelationships is present in almost all the verticals within the industry. This has provided firm in DigitalThink: Startup 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 brand equity
– Digitalthink Interrelationships has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Digitalthink Interrelationships to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Effective Research and Development (R&D)
– Digitalthink Interrelationships 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 DigitalThink: Startup - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Cross disciplinary teams
– Horizontal connected teams at the Digitalthink Interrelationships 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.
Weaknesses DigitalThink: Startup | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of DigitalThink: Startup are -
Workers concerns about automation
– As automation is fast increasing in the segment, Digitalthink Interrelationships needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Aligning sales with marketing
– It come across in the case study DigitalThink: Startup 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 DigitalThink: Startup can leverage the sales team experience to cultivate customer relationships as Digitalthink Interrelationships is planning to shift buying processes online.
Need for greater diversity
– Digitalthink Interrelationships 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Digitalthink Interrelationships is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study DigitalThink: Startup can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
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 Digitalthink Interrelationships supply chain. Even after few cautionary changes mentioned in the HBR case study - DigitalThink: Startup, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Digitalthink Interrelationships vulnerable to further global disruptions in South East Asia.
High bargaining power of channel partners
– Because of the regulatory requirements, William A. Sahlman, Michael J. Roberts, Christina Darwall suggests that, Digitalthink Interrelationships 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.
Slow decision making process
– As mentioned earlier in the report, Digitalthink Interrelationships 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. Digitalthink Interrelationships 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.
High operating costs
– Compare to the competitors, firm in the HBR case study DigitalThink: Startup has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Digitalthink Interrelationships 's lucrative customers.
Capital Spending Reduction
– Even during the low interest decade, Digitalthink Interrelationships 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.
Products dominated business model
– Even though Digitalthink Interrelationships 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 - DigitalThink: Startup should strive to include more intangible value offerings along with its core products and services.
Increasing silos among functional specialists
– The organizational structure of Digitalthink Interrelationships is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Digitalthink Interrelationships needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Digitalthink Interrelationships to focus more on services rather than just following the product oriented approach.
Opportunities DigitalThink: Startup | 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 DigitalThink: Startup are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Digitalthink Interrelationships is facing challenges because of the dominance of functional experts in the organization. DigitalThink: Startup 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.
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. Digitalthink Interrelationships can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Better consumer reach
– The expansion of the 5G network will help Digitalthink Interrelationships to increase its market reach. Digitalthink Interrelationships will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Low interest rates
– Even though inflation is raising its head in most developed economies, Digitalthink Interrelationships 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.
Building a culture of innovation
– managers at Digitalthink Interrelationships 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.
Buying journey improvements
– Digitalthink Interrelationships can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. DigitalThink: Startup 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.
Loyalty marketing
– Digitalthink Interrelationships 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Digitalthink Interrelationships 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, DigitalThink: Startup, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Using analytics as competitive advantage
– Digitalthink Interrelationships 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 DigitalThink: Startup - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Digitalthink Interrelationships to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Developing new processes and practices
– Digitalthink Interrelationships 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.
Leveraging digital technologies
– Digitalthink Interrelationships 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.
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 Digitalthink Interrelationships 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.
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 Digitalthink Interrelationships in the consumer business. Now Digitalthink Interrelationships can target international markets with far fewer capital restrictions requirements than the existing system.
Threats DigitalThink: Startup External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study DigitalThink: Startup are -
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. Digitalthink Interrelationships needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.
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 Digitalthink Interrelationships with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Environmental challenges
– Digitalthink Interrelationships 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. Digitalthink Interrelationships can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study DigitalThink: Startup, Digitalthink Interrelationships 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 .
Increasing wage structure of Digitalthink Interrelationships
– 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 Digitalthink Interrelationships.
Technology acceleration in Forth Industrial Revolution
– Digitalthink Interrelationships has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Digitalthink Interrelationships 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 Digitalthink Interrelationships 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 Digitalthink Interrelationships.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Digitalthink Interrelationships 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 DigitalThink: Startup .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Digitalthink Interrelationships 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.
Consumer confidence and its impact on Digitalthink Interrelationships 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
– Digitalthink Interrelationships 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 DigitalThink: Startup 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 DigitalThink: Startup 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 DigitalThink: Startup 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 DigitalThink: Startup 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 DigitalThink: Startup 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 Digitalthink Interrelationships needs to make to build a sustainable competitive advantage.