CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A)
In 2002, the Communications and Information Technology Commission (CITC), the Saudi Arabian telecommunications regulator, issued the second mobile services licence in the country to Ettihad Etisalat, a UAE-based telecommunications services company. This was Saudi Arabia's first step towards the liberalization of the telecommunications sector. The demand for telecommunications was strong, but development and deployment of new services lagged behind this demand. The government's plan was to attract further multinational players into the country by awarding more licenses for mobile and fixed line service providers by 2006. Arthur D. Little, a global management consulting firm, was hired by CITC in 2006 to assist in the deregulation process of the Saudi telecom market. This case highlights the key concerns and challenges that CITC faced between choosing long-term investments for building a telecommunications infrastructure within Saudi Arabia and providing increasing consumer choices in a country that was experiencing a rapidly growing consumer demand for these services.
Swot Analysis of "CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A)" written by Indranil Bose, Shilpi Banerjee includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Citc Saudi facing as an external strategic factors. Some of the topics covered in CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) case study are - Strategic Management Strategies, Policy, Regulation, Strategy and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) casestudy better are - – there is backlash against globalization, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing government debt because of Covid-19 spendings, geopolitical disruptions, there is increasing trade war between United States & China, cloud computing is disrupting traditional business models, competitive advantages are harder to sustain because of technology dispersion,
banking and financial system is disrupted by Bitcoin and other crypto currencies, wage bills are increasing, etc
Introduction to SWOT Analysis of CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Citc Saudi, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Citc Saudi 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 CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) can be done for the following purposes –
1. Strategic planning using facts provided in CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) case study
2. Improving business portfolio management of Citc Saudi
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 Citc Saudi
Strengths CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Citc Saudi in CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) Harvard Business Review case study are -
Sustainable margins compare to other players in Leadership & Managing People industry
– CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) firm has clearly differentiated products in the market place. This has enabled Citc Saudi to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Citc Saudi to invest into research and development (R&D) and innovation.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Citc Saudi digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Citc Saudi 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.
Diverse revenue streams
– Citc Saudi is present in almost all the verticals within the industry. This has provided firm in CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) 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)
– Citc Saudi 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 CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High switching costs
– The high switching costs that Citc Saudi 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.
Training and development
– Citc Saudi has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) 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.
Strong track record of project management
– Citc Saudi 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
– Citc Saudi 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 Indranil Bose, Shilpi Banerjee 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.
Cross disciplinary teams
– Horizontal connected teams at the Citc Saudi 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.
Ability to recruit top talent
– Citc Saudi is one of the leading recruiters in the industry. Managers in the CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
High brand equity
– Citc Saudi has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Citc Saudi to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Successful track record of launching new products
– Citc Saudi has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Citc Saudi 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.
Weaknesses CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) are -
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A), in the dynamic environment Citc Saudi has struggled to respond to the nimble upstart competition. Citc Saudi has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A), it seems that the employees of Citc Saudi don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) 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 Citc Saudi has relatively successful track record of launching new products.
Interest costs
– Compare to the competition, Citc Saudi 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Citc Saudi is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) 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 Citc Saudi supply chain. Even after few cautionary changes mentioned in the HBR case study - CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Citc Saudi vulnerable to further global disruptions in South East Asia.
Capital Spending Reduction
– Even during the low interest decade, Citc Saudi 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.
No frontier risks strategy
– After analyzing the HBR case study CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A), it seems that company is thinking about the frontier risks that can impact Leadership & Managing People 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.
Aligning sales with marketing
– It come across in the case study CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) 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 CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) can leverage the sales team experience to cultivate customer relationships as Citc Saudi is planning to shift buying processes online.
Increasing silos among functional specialists
– The organizational structure of Citc Saudi is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Citc Saudi needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Citc Saudi to focus more on services rather than just following the product oriented approach.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A), is just above the industry average. Citc Saudi 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.
Opportunities CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) | 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 CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) are -
Leveraging digital technologies
– Citc Saudi 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.
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. Citc Saudi can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Citc Saudi in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Leadership & Managing People segment, and it will provide faster access to the consumers.
Building a culture of innovation
– managers at Citc Saudi 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Citc Saudi is facing challenges because of the dominance of functional experts in the organization. CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) 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.
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 Citc Saudi in the consumer business. Now Citc Saudi can target international markets with far fewer capital restrictions requirements than the existing system.
Low interest rates
– Even though inflation is raising its head in most developed economies, Citc Saudi 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.
Better consumer reach
– The expansion of the 5G network will help Citc Saudi to increase its market reach. Citc Saudi 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 Citc Saudi has opened avenues for new revenue streams for the organization in the industry. This can help Citc Saudi to build a more holistic ecosystem as suggested in the CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) case study. Citc Saudi can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Citc Saudi can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Citc Saudi 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 Citc Saudi to hire the very best people irrespective of their geographical location.
Manufacturing automation
– Citc Saudi can use the latest technology developments to improve its manufacturing and designing process in Leadership & Managing People segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Developing new processes and practices
– Citc Saudi can develop new processes and procedures in Leadership & Managing People 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.
Threats CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) are -
Environmental challenges
– Citc Saudi 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. Citc Saudi can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
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. Citc Saudi can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Citc Saudi 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.
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. Citc Saudi 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.
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 Citc Saudi business can come under increasing regulations regarding data privacy, data security, etc.
Consumer confidence and its impact on Citc Saudi 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.
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.
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 Citc Saudi.
Regulatory challenges
– Citc Saudi 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.
Technology acceleration in Forth Industrial Revolution
– Citc Saudi has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Citc Saudi 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.
Stagnating economy with rate increase
– Citc Saudi 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Citc Saudi 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 CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) .
Shortening product life cycle
– it is one of the major threat that Citc Saudi is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) 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 CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) 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 CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) 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 CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) 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 CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A) 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 Citc Saudi needs to make to build a sustainable competitive advantage.
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You can download Excel Template of Case Study Solution & Analysis of CITC and Arthur D. Little: Deregulation and Liberalization of the Saudi Telecom Sector (A)
