Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing"
"The case opens with Martha Stewart's 2005 release from prison following her conviction for obstructing an insider-trading investigation of her 2001 sale of personal stock. The scandal dealt a crippling blow to the powerful Martha Stewart brand and drove results at her namesake company, Martha Stewart Living Omnimedia (MSO), deep into the red. But as owner of more than 90 percent of MSO's voting shares, Stewart continued to control the company throughout the scandal. The company faced significant external challenges, including changing consumer preferences and mounting competition in all of its markets. Ad rates were under pressure as advertisers began fragmenting spending across multiple platforms, including the Internet and social media, where MSO was weak. New competitors were luring readers from MSO's flagship publication, Martha Stewart Living. And in its second biggest business, merchandising, retailing juggernauts such as Walmart and Target were crushing MSO's most important sales channel, Kmart. Internal challenges loomed even larger, with numerous failures of governance while the company attempted a turnaround. This case can be used to teach either corporate governance or turnarounds. "
Swot Analysis of "Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing"" written by James Shein includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Stewart Martha facing as an external strategic factors. Some of the topics covered in Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" case study are - Strategic Management Strategies, Compensation, Crisis management, Decision making, Leadership, Succession planning and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" casestudy better are - – increasing commodity prices, supply chains are disrupted by pandemic , competitive advantages are harder to sustain because of technology dispersion, increasing energy prices, there is backlash against globalization, increasing inequality as vast percentage of new income is going to the top 1%, banking and financial system is disrupted by Bitcoin and other crypto currencies,
increasing government debt because of Covid-19 spendings, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing"
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Stewart Martha, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Stewart Martha 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 Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" can be done for the following purposes –
1. Strategic planning using facts provided in Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" case study
2. Improving business portfolio management of Stewart Martha
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 Stewart Martha
Strengths Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Stewart Martha in Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" Harvard Business Review case study are -
Ability to recruit top talent
– Stewart Martha is one of the leading recruiters in the industry. Managers in the Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Ability to lead change in Leadership & Managing People field
– Stewart Martha 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 Stewart Martha in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Strong track record of project management
– Stewart Martha is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Effective Research and Development (R&D)
– Stewart Martha 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 Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Low bargaining power of suppliers
– Suppliers of Stewart Martha in the sector have low bargaining power. Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Stewart Martha to manage not only supply disruptions but also source products at highly competitive prices.
Learning organization
- Stewart Martha 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 Stewart Martha is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Organizational Resilience of Stewart Martha
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Stewart Martha does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Cross disciplinary teams
– Horizontal connected teams at the Stewart Martha 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.
Superior customer experience
– The customer experience strategy of Stewart Martha in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– Stewart Martha has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" 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.
Analytics focus
– Stewart Martha 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 James Shein 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.
Innovation driven organization
– Stewart Martha is one of the most innovative firm in sector. Manager in Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Weaknesses Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" are -
Workers concerns about automation
– As automation is fast increasing in the segment, Stewart Martha 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.
High bargaining power of channel partners
– Because of the regulatory requirements, James Shein suggests that, Stewart Martha 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.
High cash cycle compare to competitors
Stewart Martha 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.
Low market penetration in new markets
– Outside its home market of Stewart Martha, firm in the HBR case study Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing", it seems that the employees of Stewart Martha 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 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 Stewart Martha supply chain. Even after few cautionary changes mentioned in the HBR case study - Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing", it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Stewart Martha vulnerable to further global disruptions in South East Asia.
Interest costs
– Compare to the competition, Stewart Martha 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.
Products dominated business model
– Even though Stewart Martha 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 - Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" should strive to include more intangible value offerings along with its core products and services.
Slow to strategic competitive environment developments
– As Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" HBR case study mentions - Stewart Martha 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.
Need for greater diversity
– Stewart Martha 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing", in the dynamic environment Stewart Martha has struggled to respond to the nimble upstart competition. Stewart Martha has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Opportunities Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" | 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 Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" are -
Creating value in data economy
– The success of analytics program of Stewart Martha has opened avenues for new revenue streams for the organization in the industry. This can help Stewart Martha to build a more holistic ecosystem as suggested in the Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" case study. Stewart Martha can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
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 Stewart Martha 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.
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 Stewart Martha in the consumer business. Now Stewart Martha can target international markets with far fewer capital restrictions requirements than the existing system.
Better consumer reach
– The expansion of the 5G network will help Stewart Martha to increase its market reach. Stewart Martha 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Stewart Martha can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Stewart Martha 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, Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing", to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Stewart Martha can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Leveraging digital technologies
– Stewart Martha 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Stewart Martha is facing challenges because of the dominance of functional experts in the organization. Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Loyalty marketing
– Stewart Martha 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Stewart Martha 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 Stewart Martha to hire the very best people irrespective of their geographical location.
Developing new processes and practices
– Stewart Martha 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.
Manufacturing automation
– Stewart Martha 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.
Threats Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" are -
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Stewart Martha with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Regulatory challenges
– Stewart Martha 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, Stewart Martha 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 Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" .
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Stewart Martha.
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. Stewart Martha can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
High dependence on third party suppliers
– Stewart Martha 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.
Consumer confidence and its impact on Stewart Martha 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.
Shortening product life cycle
– it is one of the major threat that Stewart Martha is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Stewart Martha 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.
Environmental challenges
– Stewart Martha 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. Stewart Martha 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 Stewart Martha in the Leadership & Managing People sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" 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 Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" 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 Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" 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 Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" 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 Corporate Governance at Martha Stewart Living Omnimedia: Not "A Good Thing" 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 Stewart Martha needs to make to build a sustainable competitive advantage.
