Elements of Platform Leadership SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Elements of Platform Leadership
This is an MIT Sloan Management Review article. Nowhere is the growing interconnectedness of business more clear than in the information technology industry, where the success of any one company's innovation is dependent on the activities of a complex web of partners. Michael Cusumano of the Sloan School and Annabelle Gawer of INSEAD offer a new framework for understanding what is going on and how to orchestrate the interactions. Building on their in-depth research at Intel, a company that excels in shaping its environment, the authors show how organizations can maximize innovation. First, they say, companies must decide if they are platform leaders (companies that drive industrywide innovation for an evolving system of separately developed pieces), wannabes (companies that want to be platform leaders), or complementors (companies that make ancillary products that expand the platform's market). Managers have two major challenges: coordinating internal units that play one or more of those roles and interacting effectively with outsiders playing the same roles at different times. The authors delineate four levers of platform leadership (including productive ways to work with complementors and techniques for building a supportive internal organization) and offer practical advice to complementors as well. They provide guidelines on when to show your cards to competitors and when to hold them. As the experiences of Intel, Microsoft, Cisco, NTT DoCoMo, and others demonstrate, platform leaders need to have a vision that extends beyond their current business operations and the technical specifications of one product or one component. Complementors have an important role, but it is the platform leaders, and their decisions, that have the most influence over the innovations that complementary producers create--and the future of the industry.
Swot Analysis of "Elements of Platform Leadership" written by Michael A. Cusumano, Annabelle Gawer includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Complementors Platform facing as an external strategic factors. Some of the topics covered in Elements of Platform Leadership case study are - Strategic Management Strategies, Competitive strategy, Innovation, IT, Leadership and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Elements of Platform Leadership casestudy better are - – technology disruption, supply chains are disrupted by pandemic , increasing inequality as vast percentage of new income is going to the top 1%, increasing energy prices, cloud computing is disrupting traditional business models, central banks are concerned over increasing inflation, banking and financial system is disrupted by Bitcoin and other crypto currencies,
digital marketing is dominated by two big players Facebook and Google, there is backlash against globalization, etc
Introduction to SWOT Analysis of Elements of Platform Leadership
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Elements of Platform Leadership case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Complementors Platform, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Complementors Platform 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 Elements of Platform Leadership can be done for the following purposes –
1. Strategic planning using facts provided in Elements of Platform Leadership case study
2. Improving business portfolio management of Complementors Platform
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 Complementors Platform
Strengths Elements of Platform Leadership | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Complementors Platform in Elements of Platform Leadership Harvard Business Review case study are -
Successful track record of launching new products
– Complementors Platform has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Complementors Platform 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.
Superior customer experience
– The customer experience strategy of Complementors Platform in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Strong track record of project management
– Complementors Platform 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
– Complementors Platform is one of the leading recruiters in the industry. Managers in the Elements of Platform Leadership are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Low bargaining power of suppliers
– Suppliers of Complementors Platform in the sector have low bargaining power. Elements of Platform Leadership has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Complementors Platform to manage not only supply disruptions but also source products at highly competitive prices.
High brand equity
– Complementors Platform has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Complementors Platform to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Training and development
– Complementors Platform has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Elements of Platform Leadership 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.
Learning organization
- Complementors Platform 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 Complementors Platform is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Elements of Platform Leadership Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to lead change in Leadership & Managing People field
– Complementors Platform 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 Complementors Platform in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Innovation driven organization
– Complementors Platform is one of the most innovative firm in sector. Manager in Elements of Platform Leadership Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Sustainable margins compare to other players in Leadership & Managing People industry
– Elements of Platform Leadership firm has clearly differentiated products in the market place. This has enabled Complementors Platform to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Complementors Platform to invest into research and development (R&D) and innovation.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Complementors Platform digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Complementors Platform has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Weaknesses Elements of Platform Leadership | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Elements of Platform Leadership are -
Capital Spending Reduction
– Even during the low interest decade, Complementors Platform 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.
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 Complementors Platform supply chain. Even after few cautionary changes mentioned in the HBR case study - Elements of Platform Leadership, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Complementors Platform vulnerable to further global disruptions in South East Asia.
Lack of clear differentiation of Complementors Platform products
– To increase the profitability and margins on the products, Complementors Platform needs to provide more differentiated products than what it is currently offering in the marketplace.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Elements of Platform Leadership, it seems that the employees of Complementors Platform 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Elements of Platform Leadership, in the dynamic environment Complementors Platform has struggled to respond to the nimble upstart competition. Complementors Platform 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 Elements of Platform Leadership HBR case study mentions - Complementors Platform 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Elements of Platform Leadership has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Complementors Platform 's lucrative customers.
Low market penetration in new markets
– Outside its home market of Complementors Platform, firm in the HBR case study Elements of Platform Leadership needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Workers concerns about automation
– As automation is fast increasing in the segment, Complementors Platform 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 Elements of Platform Leadership, is just above the industry average. Complementors Platform 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Michael A. Cusumano, Annabelle Gawer suggests that, Complementors Platform 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.
Opportunities Elements of Platform Leadership | 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 Elements of Platform Leadership are -
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. Complementors Platform 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. Complementors Platform 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.
Creating value in data economy
– The success of analytics program of Complementors Platform has opened avenues for new revenue streams for the organization in the industry. This can help Complementors Platform to build a more holistic ecosystem as suggested in the Elements of Platform Leadership case study. Complementors Platform can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Leveraging digital technologies
– Complementors Platform 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.
Manufacturing automation
– Complementors Platform 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Complementors Platform 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 Complementors Platform to hire the very best people irrespective of their geographical location.
Learning at scale
– Online learning technologies has now opened space for Complementors Platform 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 Complementors Platform to increase its market reach. Complementors Platform 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.
Using analytics as competitive advantage
– Complementors Platform 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 Elements of Platform Leadership - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Complementors Platform to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Building a culture of innovation
– managers at Complementors Platform 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.
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. Complementors Platform can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Developing new processes and practices
– Complementors Platform 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Complementors Platform 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, Elements of Platform Leadership, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Complementors Platform to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Threats Elements of Platform Leadership External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Elements of Platform Leadership are -
Shortening product life cycle
– it is one of the major threat that Complementors Platform is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Regulatory challenges
– Complementors Platform 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.
Consumer confidence and its impact on Complementors Platform 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.
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. Complementors Platform 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
– Complementors Platform 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. Complementors Platform can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Stagnating economy with rate increase
– Complementors Platform 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.
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.
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 Complementors Platform business can come under increasing regulations regarding data privacy, data security, etc.
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 Complementors Platform 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 Complementors Platform with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
Increasing wage structure of Complementors Platform
– 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 Complementors Platform.
High dependence on third party suppliers
– Complementors Platform 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.
Weighted SWOT Analysis of Elements of Platform Leadership 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 Elements of Platform Leadership 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 Elements of Platform Leadership 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 Elements of Platform Leadership 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 Elements of Platform Leadership 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 Complementors Platform needs to make to build a sustainable competitive advantage.