The Future of Retail: From Revenue Generator to R&D Engine SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of The Future of Retail: From Revenue Generator to R&D Engine
As the ways in which consumers make purchasing decisions continue to multiply, retailers are at a crossroads. One of the key reasons for operating a bricks-and-mortar store-building a strong, distinctive brand experience-no longer seems as relevant. Thanks to the rapid rise of social media and corporate transparency, consumers wield tremendous influence in shaping retail brands and are growing increasingly skeptical of overly-slick store designs, clerks and marketing messages. The once-dependable competitive edges enjoyed by bricks-and-mortar retailers are eroding, which means they can no longer afford to assume any inherent advantages over their online competitors. The authors describe three key paradigm shifts that smart retailers are embracing to solidify customer loyalty and provide shoppers with that increasingly-important window into an organization's soul.
Swot Analysis of "The Future of Retail: From Revenue Generator to R&D Engine" written by Dana Cho, Beau Trincia includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Retailers Bricks facing as an external strategic factors. Some of the topics covered in The Future of Retail: From Revenue Generator to R&D Engine case study are - Strategic Management Strategies, Innovation, Leadership and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the The Future of Retail: From Revenue Generator to R&D Engine casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, there is backlash against globalization, increasing energy prices, increasing commodity prices, digital marketing is dominated by two big players Facebook and Google, wage bills are increasing, customer relationship management is fast transforming because of increasing concerns over data privacy,
talent flight as more people leaving formal jobs, banking and financial system is disrupted by Bitcoin and other crypto currencies, etc
Introduction to SWOT Analysis of The Future of Retail: From Revenue Generator to R&D Engine
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The Future of Retail: From Revenue Generator to R&D Engine case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Retailers Bricks, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Retailers Bricks 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 The Future of Retail: From Revenue Generator to R&D Engine can be done for the following purposes –
1. Strategic planning using facts provided in The Future of Retail: From Revenue Generator to R&D Engine case study
2. Improving business portfolio management of Retailers Bricks
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 Retailers Bricks
Strengths The Future of Retail: From Revenue Generator to R&D Engine | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Retailers Bricks in The Future of Retail: From Revenue Generator to R&D Engine Harvard Business Review case study are -
Training and development
– Retailers Bricks has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in The Future of Retail: From Revenue Generator to R&D Engine 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)
– Retailers Bricks 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 The Future of Retail: From Revenue Generator to R&D Engine - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Highly skilled collaborators
– Retailers Bricks 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 The Future of Retail: From Revenue Generator to R&D Engine HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of Retailers Bricks
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Retailers Bricks does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Innovation driven organization
– Retailers Bricks is one of the most innovative firm in sector. Manager in The Future of Retail: From Revenue Generator to R&D Engine Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Analytics focus
– Retailers Bricks 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 Dana Cho, Beau Trincia 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 Retailers Bricks in the sector have low bargaining power. The Future of Retail: From Revenue Generator to R&D Engine has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Retailers Bricks to manage not only supply disruptions but also source products at highly competitive prices.
Ability to recruit top talent
– Retailers Bricks is one of the leading recruiters in the industry. Managers in the The Future of Retail: From Revenue Generator to R&D Engine are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Cross disciplinary teams
– Horizontal connected teams at the Retailers Bricks 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.
Successful track record of launching new products
– Retailers Bricks has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Retailers Bricks 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.
Diverse revenue streams
– Retailers Bricks is present in almost all the verticals within the industry. This has provided firm in The Future of Retail: From Revenue Generator to R&D Engine 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 Retailers Bricks in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses The Future of Retail: From Revenue Generator to R&D Engine | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The Future of Retail: From Revenue Generator to R&D Engine are -
No frontier risks strategy
– After analyzing the HBR case study The Future of Retail: From Revenue Generator to R&D Engine, 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.
Skills based hiring
– The stress on hiring functional specialists at Retailers Bricks 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.
Need for greater diversity
– Retailers Bricks has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Slow to strategic competitive environment developments
– As The Future of Retail: From Revenue Generator to R&D Engine HBR case study mentions - Retailers Bricks takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Workers concerns about automation
– As automation is fast increasing in the segment, Retailers Bricks 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study The Future of Retail: From Revenue Generator to R&D Engine, it seems that the employees of Retailers Bricks 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.
Increasing silos among functional specialists
– The organizational structure of Retailers Bricks is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Retailers Bricks needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Retailers Bricks to focus more on services rather than just following the product oriented approach.
Products dominated business model
– Even though Retailers Bricks 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 - The Future of Retail: From Revenue Generator to R&D Engine should strive to include more intangible value offerings along with its core products and services.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the The Future of Retail: From Revenue Generator to R&D Engine 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 Retailers Bricks has relatively successful track record of launching new products.
High cash cycle compare to competitors
Retailers Bricks 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.
Slow decision making process
– As mentioned earlier in the report, Retailers Bricks 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. Retailers Bricks 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.
Opportunities The Future of Retail: From Revenue Generator to R&D Engine | 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 The Future of Retail: From Revenue Generator to R&D Engine are -
Learning at scale
– Online learning technologies has now opened space for Retailers Bricks 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.
Creating value in data economy
– The success of analytics program of Retailers Bricks has opened avenues for new revenue streams for the organization in the industry. This can help Retailers Bricks to build a more holistic ecosystem as suggested in the The Future of Retail: From Revenue Generator to R&D Engine case study. Retailers Bricks can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Leveraging digital technologies
– Retailers Bricks 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Retailers Bricks 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Retailers Bricks can use these opportunities to build new business models that can help the communities that Retailers Bricks operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Retailers Bricks 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 Retailers Bricks to hire the very best people irrespective of their geographical location.
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. Retailers Bricks 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. Retailers Bricks 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.
Buying journey improvements
– Retailers Bricks can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. The Future of Retail: From Revenue Generator to R&D Engine 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Retailers Bricks can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Loyalty marketing
– Retailers Bricks has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Retailers Bricks 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, The Future of Retail: From Revenue Generator to R&D Engine, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Using analytics as competitive advantage
– Retailers Bricks 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 The Future of Retail: From Revenue Generator to R&D Engine - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Retailers Bricks to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Retailers Bricks can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats The Future of Retail: From Revenue Generator to R&D Engine External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The Future of Retail: From Revenue Generator to R&D Engine are -
Consumer confidence and its impact on Retailers Bricks 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.
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 Retailers Bricks business can come under increasing regulations regarding data privacy, data security, etc.
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. Retailers Bricks 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.
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 Retailers Bricks in the Leadership & Managing People sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Retailers Bricks 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.
Shortening product life cycle
– it is one of the major threat that Retailers Bricks is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Retailers Bricks can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Regulatory challenges
– Retailers Bricks 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Retailers Bricks 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. Retailers Bricks needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Environmental challenges
– Retailers Bricks 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. Retailers Bricks can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
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.
Weighted SWOT Analysis of The Future of Retail: From Revenue Generator to R&D Engine 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 The Future of Retail: From Revenue Generator to R&D Engine 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 The Future of Retail: From Revenue Generator to R&D Engine 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 The Future of Retail: From Revenue Generator to R&D Engine 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 The Future of Retail: From Revenue Generator to R&D Engine 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 Retailers Bricks needs to make to build a sustainable competitive advantage.