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 - – there is increasing trade war between United States & China, increasing commodity prices, challanges to central banks by blockchain based private currencies, increasing household debt because of falling income levels, cloud computing is disrupting traditional business models, wage bills are increasing, central banks are concerned over increasing inflation,
supply chains are disrupted by pandemic , technology disruption, 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 -
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.
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.
Learning organization
- Stetzel Teddy is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Stetzel Teddy is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Superior customer experience
– The customer experience strategy of Stetzel Teddy in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
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.
Analytics focus
– Stetzel Teddy 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 Janis L. Gogan, Mark Lewis 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.
Low bargaining power of suppliers
– Suppliers of Stetzel Teddy in the sector have low bargaining power. Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Stetzel Teddy to manage not only supply disruptions but also source products at highly competitive prices.
Operational resilience
– The operational resilience strategy in the Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear 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.
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.
Highly skilled collaborators
– Stetzel Teddy has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– Stetzel Teddy has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Stetzel Teddy 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.
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.
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 -
Workers concerns about automation
– As automation is fast increasing in the segment, Stetzel Teddy 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.
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.
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.
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.
Skills based hiring
– The stress on hiring functional specialists at Stetzel Teddy 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear 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 Stetzel Teddy has relatively successful track record of launching new products.
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.
Aligning sales with marketing
– It come across in the case study Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear 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 Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear can leverage the sales team experience to cultivate customer relationships as Stetzel Teddy is planning to shift buying processes online.
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 bargaining power of channel partners
– Because of the regulatory requirements, Janis L. Gogan, Mark Lewis suggests that, Stetzel Teddy 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.
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.
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 -
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.
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.
Better consumer reach
– The expansion of the 5G network will help Stetzel Teddy to increase its market reach. Stetzel Teddy 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 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.
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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Stetzel Teddy 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.
Learning at scale
– Online learning technologies has now opened space for Stetzel Teddy 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.
Building a culture of innovation
– managers at Stetzel Teddy 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Stetzel Teddy can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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.
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.
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 -
Shortening product life cycle
– it is one of the major threat that Stetzel Teddy is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, 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.
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.
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.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Peak Experiences and Strategic IT Alignment At Vermont Teddy Bear, Stetzel Teddy 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 .
High dependence on third party suppliers
– Stetzel Teddy 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.
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.
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.
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.
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.
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.
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.
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.