Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear
In winter 2010 Bob Stetzel, the new Chief Information Officer (CIO) at Vermont Teddy Bear (VTB), hopes to replace or modernize many of the company's existing systems and invest in some new applications. This catalog marketer (via online and print catalogs) offers three separately managed brands: Vermont Teddy Bear (VTB), PajamaGrams, and Calyx Flowers. Sales are highly seasonal, with peak volumes at Christmas, Valentine's Day and Mother's Day. Stetzel has spent his first few months on the job cataloging systems and databases, learning about the 'spider web' of middleware connecting various applications and platforms, and locating employees with expertise to fix them. The company has survived an economic downturn and several costly strategic missteps. The CEO is seeking new sources of revenue and ways to leverage their well-known brand, while the CIO needs to set Information Technology (IT) priorities: should they invest in a full-featured Enterprise Resource Planning (ERP) package or take other steps that would more quickly yield tangible results? Whatever choice he makes, Stetzel will have to convince the CEO and the Board of Directors to provide the necessary resources. This case provides students with an opportunity to place themselves in the shoes of a CIO wrestling with strategic IT alignment challenges at a time when resources are severely constrained and competitive rivalry is fierce.
Swot Analysis of "Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear" written by Janis L. Gogan, Mark Lewis includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Stetzel Teddy facing as an external strategic factors. Some of the topics covered in Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear case study are - Strategic Management Strategies, Strategy and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear casestudy better are - – increasing household debt because of falling income levels, digital marketing is dominated by two big players Facebook and Google, talent flight as more people leaving formal jobs, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing energy prices, supply chains are disrupted by pandemic , banking and financial system is disrupted by Bitcoin and other crypto currencies,
increasing government debt because of Covid-19 spendings, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Stetzel Teddy, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Stetzel Teddy 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 Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear can be done for the following purposes –
1. Strategic planning using facts provided in Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear case study
2. Improving business portfolio management of Stetzel Teddy
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 Stetzel Teddy
Strengths Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Stetzel Teddy in Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear Harvard Business Review case study are -
Innovation driven organization
– Stetzel Teddy is one of the most innovative firm in sector. Manager in Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Training and development
– Stetzel Teddy has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear 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.
Effective Research and Development (R&D)
– Stetzel Teddy 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 Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear - 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
– Stetzel Teddy 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 Stetzel Teddy in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Sustainable margins compare to other players in Leadership & Managing People industry
– Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear firm has clearly differentiated products in the market place. This has enabled Stetzel Teddy to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Stetzel Teddy to invest into research and development (R&D) and innovation.
High brand equity
– Stetzel Teddy has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Stetzel Teddy to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Strong track record of project management
– Stetzel Teddy is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Organizational Resilience of Stetzel Teddy
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Stetzel Teddy does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High switching costs
– The high switching costs that Stetzel Teddy 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.
Diverse revenue streams
– Stetzel Teddy is present in almost all the verticals within the industry. This has provided firm in Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear 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.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Stetzel Teddy digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Stetzel Teddy 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.
Cross disciplinary teams
– Horizontal connected teams at the Stetzel Teddy 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 Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear are -
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 Stetzel Teddy supply chain. Even after few cautionary changes mentioned in the HBR case study - Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Stetzel Teddy vulnerable to further global disruptions in South East Asia.
Need for greater diversity
– Stetzel Teddy 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.
Products dominated business model
– Even though Stetzel Teddy 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 - Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear should strive to include more intangible value offerings along with its core products and services.
Low market penetration in new markets
– Outside its home market of Stetzel Teddy, firm in the HBR case study Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Interest costs
– Compare to the competition, Stetzel Teddy 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear 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 Stetzel Teddy 's lucrative customers.
Lack of clear differentiation of Stetzel Teddy products
– To increase the profitability and margins on the products, Stetzel Teddy needs to provide more differentiated products than what it is currently offering in the marketplace.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear, in the dynamic environment Stetzel Teddy has struggled to respond to the nimble upstart competition. Stetzel Teddy has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Capital Spending Reduction
– Even during the low interest decade, Stetzel Teddy 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear, is just above the industry average. Stetzel Teddy 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear, it seems that the employees of Stetzel Teddy 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.
Opportunities Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear | 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 Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear are -
Creating value in data economy
– The success of analytics program of Stetzel Teddy has opened avenues for new revenue streams for the organization in the industry. This can help Stetzel Teddy to build a more holistic ecosystem as suggested in the Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear case study. Stetzel Teddy can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Stetzel Teddy 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 Stetzel Teddy to hire the very best people irrespective of their geographical location.
Manufacturing automation
– Stetzel Teddy 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.
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 Stetzel Teddy in the consumer business. Now Stetzel Teddy can target international markets with far fewer capital restrictions requirements than the existing system.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Stetzel Teddy 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Stetzel Teddy 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, Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Leveraging digital technologies
– Stetzel Teddy 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.
Loyalty marketing
– Stetzel Teddy 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.
Using analytics as competitive advantage
– Stetzel Teddy 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 Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Stetzel Teddy 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
– Stetzel Teddy 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.
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. Stetzel Teddy can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Buying journey improvements
– Stetzel Teddy can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Stetzel Teddy can use these opportunities to build new business models that can help the communities that Stetzel Teddy operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Threats Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Stetzel Teddy with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Regulatory challenges
– Stetzel Teddy 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 Stetzel Teddy business can come under increasing regulations regarding data privacy, data security, etc.
Consumer confidence and its impact on Stetzel Teddy 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 acceleration in Forth Industrial Revolution
– Stetzel Teddy has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Stetzel Teddy 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.
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. Stetzel Teddy needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Stagnating economy with rate increase
– Stetzel Teddy 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.
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. Stetzel Teddy can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing wage structure of Stetzel Teddy
– 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 Stetzel Teddy.
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. Stetzel Teddy 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.
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Stetzel Teddy 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.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Stetzel Teddy in the Leadership & Managing People sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear 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 Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear 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 Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear 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 Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear 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 Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear 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 Stetzel Teddy needs to make to build a sustainable competitive advantage.