Case Study Description of IMAX Expansion in BRIC Economies
IMAX is a Canadian-based company synonymous with large-format, high-quality cinematic experiences. Following four decades of innovation, the bulk of its revenue now comes from providing technology to mainstream movie studios and multiplex exhibitors. IMAX has more than 900 cinema screens in 58 countries, with nearly half of them located in North America. Its chief executive officer believes that the route to becoming a billion-dollar company involves adding 1,200 screens in markets outside of North America. If about a third of new worldwide screens are designated for Brazil, Russia, China and India - the BRIC economies - how should IMAX allocate these new screens by country and by city?
Authors :: Dwarkaprasad Chakravarty, Paul W. Beamish
Swot Analysis of "IMAX Expansion in BRIC Economies" written by Dwarkaprasad Chakravarty, Paul W. Beamish includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Imax Screens facing as an external strategic factors. Some of the topics covered in IMAX Expansion in BRIC Economies case study are - Strategic Management Strategies, Growth strategy and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the IMAX Expansion in BRIC Economies casestudy better are - – there is increasing trade war between United States & China, technology disruption, talent flight as more people leaving formal jobs, increasing household debt because of falling income levels, central banks are concerned over increasing inflation, increasing energy prices, there is backlash against globalization,
cloud computing is disrupting traditional business models, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of IMAX Expansion in BRIC Economies
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in IMAX Expansion in BRIC Economies case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Imax Screens, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Imax Screens 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 IMAX Expansion in BRIC Economies can be done for the following purposes –
1. Strategic planning using facts provided in IMAX Expansion in BRIC Economies case study
2. Improving business portfolio management of Imax Screens
3. Assessing feasibility of the new initiative in Leadership & Managing People field.
4. Making a Leadership & Managing People topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Imax Screens
Strengths IMAX Expansion in BRIC Economies | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Imax Screens in IMAX Expansion in BRIC Economies Harvard Business Review case study are -
Training and development
– Imax Screens has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in IMAX Expansion in BRIC Economies 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 Imax Screens in the sector have low bargaining power. IMAX Expansion in BRIC Economies has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Imax Screens to manage not only supply disruptions but also source products at highly competitive prices.
Successful track record of launching new products
– Imax Screens has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Imax Screens 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.
Effective Research and Development (R&D)
– Imax Screens 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 IMAX Expansion in BRIC Economies - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to lead change in Leadership & Managing People field
– Imax Screens 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 Imax Screens in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Organizational Resilience of Imax Screens
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Imax Screens does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Strong track record of project management
– Imax Screens is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Analytics focus
– Imax Screens 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 Dwarkaprasad Chakravarty, Paul W. Beamish 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.
Diverse revenue streams
– Imax Screens is present in almost all the verticals within the industry. This has provided firm in IMAX Expansion in BRIC Economies 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.
Superior customer experience
– The customer experience strategy of Imax Screens in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Imax Screens digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Imax Screens 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.
Sustainable margins compare to other players in Leadership & Managing People industry
– IMAX Expansion in BRIC Economies firm has clearly differentiated products in the market place. This has enabled Imax Screens to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Imax Screens to invest into research and development (R&D) and innovation.
Weaknesses IMAX Expansion in BRIC Economies | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of IMAX Expansion in BRIC Economies are -
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study IMAX Expansion in BRIC Economies, in the dynamic environment Imax Screens has struggled to respond to the nimble upstart competition. Imax Screens has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High operating costs
– Compare to the competitors, firm in the HBR case study IMAX Expansion in BRIC Economies 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 Imax Screens 's lucrative customers.
Slow decision making process
– As mentioned earlier in the report, Imax Screens 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. Imax Screens 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 Imax Screens 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study IMAX Expansion in BRIC Economies, is just above the industry average. Imax Screens 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Dwarkaprasad Chakravarty, Paul W. Beamish suggests that, Imax Screens 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Imax Screens 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.
Low market penetration in new markets
– Outside its home market of Imax Screens, firm in the HBR case study IMAX Expansion in BRIC Economies needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the IMAX Expansion in BRIC Economies 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 Imax Screens has relatively successful track record of launching new products.
High cash cycle compare to competitors
Imax Screens 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.
Products dominated business model
– Even though Imax Screens 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 - IMAX Expansion in BRIC Economies should strive to include more intangible value offerings along with its core products and services.
Opportunities IMAX Expansion in BRIC Economies | 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 IMAX Expansion in BRIC Economies are -
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Imax Screens can use these opportunities to build new business models that can help the communities that Imax Screens operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
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. Imax Screens can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Building a culture of innovation
– managers at Imax Screens 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 Leadership & Managing People segment.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Leadership & Managing People industry, but it has also influenced the consumer preferences. Imax Screens 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 Imax Screens to increase its market reach. Imax Screens 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Leadership & Managing People industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Imax Screens 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. Imax Screens 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Imax Screens can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Imax Screens 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.
Using analytics as competitive advantage
– Imax Screens 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 IMAX Expansion in BRIC Economies - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Imax Screens 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 Imax Screens 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.
Leveraging digital technologies
– Imax Screens 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.
Creating value in data economy
– The success of analytics program of Imax Screens has opened avenues for new revenue streams for the organization in the industry. This can help Imax Screens to build a more holistic ecosystem as suggested in the IMAX Expansion in BRIC Economies case study. Imax Screens can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Imax Screens can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. IMAX Expansion in BRIC Economies 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.
Threats IMAX Expansion in BRIC Economies External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study IMAX Expansion in BRIC Economies are -
Technology acceleration in Forth Industrial Revolution
– Imax Screens has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Imax Screens needs to keep up with the evolution of technology in the Leadership & Managing People 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.
Increasing wage structure of Imax Screens
– 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 Imax Screens.
High dependence on third party suppliers
– Imax Screens 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.
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 Imax Screens.
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Imax Screens in the Leadership & Managing People industry. The Leadership & Managing People 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.
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. Imax Screens needs to understand the core reasons impacting the Leadership & Managing People 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.
Shortening product life cycle
– it is one of the major threat that Imax Screens is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Regulatory challenges
– Imax Screens 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 Leadership & Managing People industry regulations.
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 Imax Screens business can come under increasing regulations regarding data privacy, data security, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study IMAX Expansion in BRIC Economies, Imax Screens may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Leadership & Managing People .
Easy access to finance
– Easy access to finance in Leadership & Managing People field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Imax Screens can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of IMAX Expansion in BRIC Economies 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 IMAX Expansion in BRIC Economies 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 IMAX Expansion in BRIC Economies 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 IMAX Expansion in BRIC Economies 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 IMAX Expansion in BRIC Economies 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 Imax Screens needs to make to build a sustainable competitive advantage.