Case Study Description of Growing Pains at Stroz Friedberg
In late spring 2009, Stroz Friedberg co-presidents Edward Stroz and Eric Friedberg had to set growth targets for 2010. The leading global consulting firm they had built specialized in managing digital risk and uncovering digital evidence and had grown very rapidly. With the firm's CFO, they believed that the firm could grow from $58 million to $72 million, a growth rate of 27% over the preceding year. However, the firm's 11 offices had submitted first draft FY 2010 plans that together added up to firm-wide revenues of only $53 million, a growth rate of negative 10.2%. The preceding years of rapid growth had been successful but challenging, and a thorough review of the firm's culture, systems, structure, and processes in late 2008 had resulted in a significant set of changes to which the organization was still adjusting. Stroz and Friedberg wondered whether to push for continued, aggressive growth.
Swot Analysis of "Growing Pains at Stroz Friedberg" written by David A. Garvin, Carin-Isabel Knoop includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Friedberg Stroz facing as an external strategic factors. Some of the topics covered in Growing Pains at Stroz Friedberg case study are - Strategic Management Strategies, Entrepreneurial management, Growth strategy, Organizational structure and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Growing Pains at Stroz Friedberg casestudy better are - – talent flight as more people leaving formal jobs, increasing transportation and logistics costs, wage bills are increasing, increasing inequality as vast percentage of new income is going to the top 1%, central banks are concerned over increasing inflation, competitive advantages are harder to sustain because of technology dispersion, banking and financial system is disrupted by Bitcoin and other crypto currencies,
increasing government debt because of Covid-19 spendings, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of Growing Pains at Stroz Friedberg
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Growing Pains at Stroz Friedberg case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Friedberg Stroz, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Friedberg Stroz 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 Growing Pains at Stroz Friedberg can be done for the following purposes –
1. Strategic planning using facts provided in Growing Pains at Stroz Friedberg case study
2. Improving business portfolio management of Friedberg Stroz
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 Friedberg Stroz
Strengths Growing Pains at Stroz Friedberg | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Friedberg Stroz in Growing Pains at Stroz Friedberg Harvard Business Review case study are -
Training and development
– Friedberg Stroz has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Growing Pains at Stroz Friedberg 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.
Successful track record of launching new products
– Friedberg Stroz has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Friedberg Stroz 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.
Strong track record of project management
– Friedberg Stroz is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to recruit top talent
– Friedberg Stroz is one of the leading recruiters in the industry. Managers in the Growing Pains at Stroz Friedberg are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Learning organization
- Friedberg Stroz 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 Friedberg Stroz is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Growing Pains at Stroz Friedberg Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Low bargaining power of suppliers
– Suppliers of Friedberg Stroz in the sector have low bargaining power. Growing Pains at Stroz Friedberg has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Friedberg Stroz to manage not only supply disruptions but also source products at highly competitive prices.
Analytics focus
– Friedberg Stroz 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 David A. Garvin, Carin-Isabel Knoop can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Cross disciplinary teams
– Horizontal connected teams at the Friedberg Stroz 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.
Operational resilience
– The operational resilience strategy in the Growing Pains at Stroz Friedberg 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.
Sustainable margins compare to other players in Leadership & Managing People industry
– Growing Pains at Stroz Friedberg firm has clearly differentiated products in the market place. This has enabled Friedberg Stroz to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Friedberg Stroz to invest into research and development (R&D) and innovation.
Organizational Resilience of Friedberg Stroz
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Friedberg Stroz does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Highly skilled collaborators
– Friedberg Stroz 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 Growing Pains at Stroz Friedberg HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses Growing Pains at Stroz Friedberg | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Growing Pains at Stroz Friedberg 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 Friedberg Stroz supply chain. Even after few cautionary changes mentioned in the HBR case study - Growing Pains at Stroz Friedberg, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Friedberg Stroz vulnerable to further global disruptions in South East Asia.
No frontier risks strategy
– After analyzing the HBR case study Growing Pains at Stroz Friedberg, 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Friedberg Stroz is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Growing Pains at Stroz Friedberg can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Friedberg Stroz 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.
Low market penetration in new markets
– Outside its home market of Friedberg Stroz, firm in the HBR case study Growing Pains at Stroz Friedberg needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Products dominated business model
– Even though Friedberg Stroz 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 - Growing Pains at Stroz Friedberg should strive to include more intangible value offerings along with its core products and services.
Interest costs
– Compare to the competition, Friedberg Stroz 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 dependence on star products
– The top 2 products and services of the firm as mentioned in the Growing Pains at Stroz Friedberg 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 Friedberg Stroz has relatively successful track record of launching new products.
Aligning sales with marketing
– It come across in the case study Growing Pains at Stroz Friedberg 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 Growing Pains at Stroz Friedberg can leverage the sales team experience to cultivate customer relationships as Friedberg Stroz is planning to shift buying processes online.
Skills based hiring
– The stress on hiring functional specialists at Friedberg Stroz 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 Growing Pains at Stroz Friedberg, it seems that the employees of Friedberg Stroz 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 Growing Pains at Stroz Friedberg | 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 Growing Pains at Stroz Friedberg are -
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. Friedberg Stroz can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Loyalty marketing
– Friedberg Stroz 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Friedberg Stroz can use these opportunities to build new business models that can help the communities that Friedberg Stroz operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Developing new processes and practices
– Friedberg Stroz 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.
Using analytics as competitive advantage
– Friedberg Stroz 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 Growing Pains at Stroz Friedberg - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Friedberg Stroz to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Friedberg Stroz 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, Growing Pains at Stroz Friedberg, 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, Friedberg Stroz can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Better consumer reach
– The expansion of the 5G network will help Friedberg Stroz to increase its market reach. Friedberg Stroz 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Friedberg Stroz 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 Friedberg Stroz to hire the very best people irrespective of their geographical location.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Friedberg Stroz 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Friedberg Stroz can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Friedberg Stroz can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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. Friedberg Stroz 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. Friedberg Stroz 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.
Threats Growing Pains at Stroz Friedberg External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Growing Pains at Stroz Friedberg are -
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 Friedberg Stroz in the Leadership & Managing People sector and impact the bottomline of the organization.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Growing Pains at Stroz Friedberg, Friedberg Stroz 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 .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Friedberg Stroz with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
High dependence on third party suppliers
– Friedberg Stroz 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.
Regulatory challenges
– Friedberg Stroz 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.
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 acceleration in Forth Industrial Revolution
– Friedberg Stroz has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Friedberg Stroz 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.
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. Friedberg Stroz can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Shortening product life cycle
– it is one of the major threat that Friedberg Stroz is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing wage structure of Friedberg Stroz
– 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 Friedberg Stroz.
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 Friedberg Stroz business can come under increasing regulations regarding data privacy, data security, etc.
Consumer confidence and its impact on Friedberg Stroz 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Friedberg Stroz 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 Growing Pains at Stroz Friedberg .
Weighted SWOT Analysis of Growing Pains at Stroz Friedberg 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 Growing Pains at Stroz Friedberg 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 Growing Pains at Stroz Friedberg 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 Growing Pains at Stroz Friedberg 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 Growing Pains at Stroz Friedberg 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 Friedberg Stroz needs to make to build a sustainable competitive advantage.
