Case Study Description of Connected Consumption : A Sharing Economy Emerges
Widespread critiques of capitalism-as articulated by social movements such as Occupy Wall Street-have been widely legitimated, say the authors, and the resulting ideological shift has propelled migration towards 'connected consumption'. Emphasizing the re-use of goods rather than buying new, these practices facilitate local, face-to-face connections, and they are redesigning models of service delivery. The authors describe four types of connected consumption, then focus on one ('time banks'), explaining the broader context that is propelling this movement's popularity.
Swot Analysis of "Connected Consumption : A Sharing Economy Emerges" written by Emilie Dubois, Juliet Schor, Lindsey Carfagna includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Connected Consumption facing as an external strategic factors. Some of the topics covered in Connected Consumption : A Sharing Economy Emerges case study are - Strategic Management Strategies, Customers, Ethics and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Connected Consumption : A Sharing Economy Emerges casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, increasing government debt because of Covid-19 spendings, competitive advantages are harder to sustain because of technology dispersion, customer relationship management is fast transforming because of increasing concerns over data privacy, supply chains are disrupted by pandemic , geopolitical disruptions, increasing transportation and logistics costs,
digital marketing is dominated by two big players Facebook and Google, talent flight as more people leaving formal jobs, etc
Introduction to SWOT Analysis of Connected Consumption : A Sharing Economy Emerges
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Connected Consumption : A Sharing Economy Emerges case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Connected Consumption, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Connected Consumption 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 Connected Consumption : A Sharing Economy Emerges can be done for the following purposes –
1. Strategic planning using facts provided in Connected Consumption : A Sharing Economy Emerges case study
2. Improving business portfolio management of Connected Consumption
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 Connected Consumption
Strengths Connected Consumption : A Sharing Economy Emerges | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Connected Consumption in Connected Consumption : A Sharing Economy Emerges Harvard Business Review case study are -
Cross disciplinary teams
– Horizontal connected teams at the Connected Consumption 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 lead change in Leadership & Managing People field
– Connected Consumption 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 Connected Consumption in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Innovation driven organization
– Connected Consumption is one of the most innovative firm in sector. Manager in Connected Consumption : A Sharing Economy Emerges Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Analytics focus
– Connected Consumption 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 Emilie Dubois, Juliet Schor, Lindsey Carfagna can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Diverse revenue streams
– Connected Consumption is present in almost all the verticals within the industry. This has provided firm in Connected Consumption : A Sharing Economy Emerges 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.
Strong track record of project management
– Connected Consumption 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
– Connected Consumption 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 Connected Consumption : A Sharing Economy Emerges HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High switching costs
– The high switching costs that Connected Consumption 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.
Learning organization
- Connected Consumption 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 Connected Consumption is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Connected Consumption : A Sharing Economy Emerges Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Effective Research and Development (R&D)
– Connected Consumption 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 Connected Consumption : A Sharing Economy Emerges - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Sustainable margins compare to other players in Leadership & Managing People industry
– Connected Consumption : A Sharing Economy Emerges firm has clearly differentiated products in the market place. This has enabled Connected Consumption to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Connected Consumption to invest into research and development (R&D) and innovation.
Superior customer experience
– The customer experience strategy of Connected Consumption in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses Connected Consumption : A Sharing Economy Emerges | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Connected Consumption : A Sharing Economy Emerges are -
Low market penetration in new markets
– Outside its home market of Connected Consumption, firm in the HBR case study Connected Consumption : A Sharing Economy Emerges needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Lack of clear differentiation of Connected Consumption products
– To increase the profitability and margins on the products, Connected Consumption needs to provide more differentiated products than what it is currently offering in the marketplace.
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 Connected Consumption supply chain. Even after few cautionary changes mentioned in the HBR case study - Connected Consumption : A Sharing Economy Emerges, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Connected Consumption vulnerable to further global disruptions in South East Asia.
Capital Spending Reduction
– Even during the low interest decade, Connected Consumption 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Connected Consumption : A Sharing Economy Emerges, in the dynamic environment Connected Consumption has struggled to respond to the nimble upstart competition. Connected Consumption has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to strategic competitive environment developments
– As Connected Consumption : A Sharing Economy Emerges HBR case study mentions - Connected Consumption 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.
Skills based hiring
– The stress on hiring functional specialists at Connected Consumption 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Connected Consumption : A Sharing Economy Emerges, it seems that the employees of Connected Consumption 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 Connected Consumption : A Sharing Economy Emerges 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 Connected Consumption has relatively successful track record of launching new products.
Workers concerns about automation
– As automation is fast increasing in the segment, Connected Consumption 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.
Interest costs
– Compare to the competition, Connected Consumption 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.
Opportunities Connected Consumption : A Sharing Economy Emerges | 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 Connected Consumption : A Sharing Economy Emerges are -
Using analytics as competitive advantage
– Connected Consumption 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 Connected Consumption : A Sharing Economy Emerges - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Connected Consumption to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Connected Consumption can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Connected Consumption can use these opportunities to build new business models that can help the communities that Connected Consumption operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Building a culture of innovation
– managers at Connected Consumption 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Connected Consumption 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 Connected Consumption to hire the very best people irrespective of their geographical location.
Manufacturing automation
– Connected Consumption 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 Connected Consumption in the consumer business. Now Connected Consumption can target international markets with far fewer capital restrictions requirements than the existing system.
Learning at scale
– Online learning technologies has now opened space for Connected Consumption 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.
Better consumer reach
– The expansion of the 5G network will help Connected Consumption to increase its market reach. Connected Consumption 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Connected Consumption 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.
Creating value in data economy
– The success of analytics program of Connected Consumption has opened avenues for new revenue streams for the organization in the industry. This can help Connected Consumption to build a more holistic ecosystem as suggested in the Connected Consumption : A Sharing Economy Emerges case study. Connected Consumption can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Connected Consumption can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Connected Consumption : A Sharing Economy Emerges 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.
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. Connected Consumption can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats Connected Consumption : A Sharing Economy Emerges External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Connected Consumption : A Sharing Economy Emerges are -
Consumer confidence and its impact on Connected Consumption 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
– Connected Consumption has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Connected Consumption 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.
Regulatory challenges
– Connected Consumption 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Connected Consumption 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 Connected Consumption : A Sharing Economy Emerges .
Increasing wage structure of Connected Consumption
– 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 Connected Consumption.
High dependence on third party suppliers
– Connected Consumption 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.
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 Connected Consumption 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
– Connected Consumption 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.
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. Connected Consumption 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.
Environmental challenges
– Connected Consumption 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. Connected Consumption can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
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 Connected Consumption in the Leadership & Managing People sector and impact the bottomline of the organization.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Connected Consumption with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Weighted SWOT Analysis of Connected Consumption : A Sharing Economy Emerges 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 Connected Consumption : A Sharing Economy Emerges 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 Connected Consumption : A Sharing Economy Emerges 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 Connected Consumption : A Sharing Economy Emerges 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 Connected Consumption : A Sharing Economy Emerges 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 Connected Consumption needs to make to build a sustainable competitive advantage.
