RR Donnelley & Sons (RRD) SWOT Analysis / TOWS Matrix / MBA Resources
Printing Services
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for RR Donnelley & Sons (United States)
Based on various researches at Oak Spring University , RR Donnelley & Sons is operating in a macro-environment that has been destablized by – there is increasing trade war between United States & China, customer relationship management is fast transforming because of increasing concerns over data privacy, digital marketing is dominated by two big players Facebook and Google, technology disruption, competitive advantages are harder to sustain because of technology dispersion, supply chains are disrupted by pandemic , wage bills are increasing,
increasing transportation and logistics costs, talent flight as more people leaving formal jobs, etc
Introduction to SWOT Analysis of RR Donnelley & Sons
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that RR Donnelley & Sons can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the RR Donnelley & Sons, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which RR Donnelley & Sons 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 RR Donnelley & Sons can be done for the following purposes –
1. Strategic planning of RR Donnelley & Sons
2. Improving business portfolio management of RR Donnelley & Sons
3. Assessing feasibility of the new initiative in United States
4. Making a Printing Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of RR Donnelley & Sons
Strengths of RR Donnelley & Sons | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of RR Donnelley & Sons are -
Training and development
– RR Donnelley & Sons has one of the best training and development program in Services industry. The effectiveness of the training programs can be measured in – 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
– RR Donnelley & Sons has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. RR Donnelley & Sons 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.
Ability to lead change in Printing Services
– RR Donnelley & Sons is one of the leading players in the Printing Services industry in United States. Over the years it has not only transformed the business landscape in the Printing Services industry in United States but also across the existing markets. The ability to lead change has enabled RR Donnelley & Sons in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Organizational Resilience of RR Donnelley & Sons
– The covid-19 pandemic has put organizational resilience at the centre of everthing RR Donnelley & Sons does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Diverse revenue streams
– RR Donnelley & Sons is present in almost all the verticals within the Printing Services industry. This has provided RR Donnelley & Sons 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.
Learning organization
- RR Donnelley & Sons 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 RR Donnelley & Sons is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at RR Donnelley & Sons emphasize – knowledge, initiative, and innovation.
High switching costs
– The high switching costs that RR Donnelley & Sons 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.
Cross disciplinary teams
– Horizontal connected teams at the RR Donnelley & Sons 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.
Effective Research and Development (R&D)
– RR Donnelley & Sons has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – RR Donnelley & Sons staying ahead in the Printing Services industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Superior customer experience
– The customer experience strategy of RR Donnelley & Sons in Printing Services industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Low bargaining power of suppliers
– Suppliers of RR Donnelley & Sons in the Services sector have low bargaining power. RR Donnelley & Sons has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps RR Donnelley & Sons to manage not only supply disruptions but also source products at highly competitive prices.
Analytics focus
– RR Donnelley & Sons 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 Printing Services industry. The technology infrastructure of United States is also helping it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Weaknesses of RR Donnelley & Sons | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of RR Donnelley & Sons are -
Products dominated business model
– Even though RR Donnelley & Sons has some of the most successful models in the Printing Services industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. RR Donnelley & Sons should strive to include more intangible value offerings along with its core products and services.
Slow to strategic competitive environment developments
– As RR Donnelley & Sons is one of the leading players in the Printing Services industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Printing Services industry in last five years.
Aligning sales with marketing
– From the outside it seems that RR Donnelley & Sons needs to have more collaboration between its sales team and marketing team. Sales professionals in the Printing Services industry have deep experience in developing customer relationships. Marketing department at RR Donnelley & Sons can leverage the sales team experience to cultivate customer relationships as RR Donnelley & Sons is planning to shift buying processes online.
Slow decision making process
– As mentioned earlier in the report, RR Donnelley & Sons has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Printing Services industry over the last five years. RR Donnelley & Sons even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
High dependence on RR Donnelley & Sons ‘s star products
– The top 2 products and services of RR Donnelley & Sons still accounts for major business revenue. This dependence on star products in Printing Services industry has resulted into insufficient focus on developing new products, even though RR Donnelley & Sons has relatively successful track record of launching new products.
Skills based hiring in Printing Services industry
– The stress on hiring functional specialists at RR Donnelley & Sons 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.
High cash cycle compare to competitors
RR Donnelley & Sons has a high cash cycle compare to other players in the Printing Services industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
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 RR Donnelley & Sons supply chain. Even after few cautionary changes, RR Donnelley & Sons is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left RR Donnelley & Sons vulnerable to further global disruptions in South East Asia.
Need for greater diversity
– RR Donnelley & Sons 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.
Increasing silos among functional specialists
– The organizational structure of RR Donnelley & Sons is dominated by functional specialists. It is not different from other players in the Printing Services industry, but RR Donnelley & Sons needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help RR Donnelley & Sons to focus more on services in the Printing Services industry rather than just following the product oriented approach.
Workers concerns about automation
– As automation is fast increasing in the Printing Services industry, RR Donnelley & Sons 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.
RR Donnelley & Sons Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of RR Donnelley & Sons are -
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Printing Services industry, but it has also influenced the consumer preferences. RR Donnelley & Sons can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Learning at scale
– Online learning technologies has now opened space for RR Donnelley & Sons 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.
Buying journey improvements
– RR Donnelley & Sons can improve the customer journey of consumers in the Printing Services industry by using analytics and artificial intelligence. It 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.
Leveraging digital technologies
– RR Donnelley & Sons 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects RR Donnelley & Sons can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Better consumer reach
– The expansion of the 5G network will help RR Donnelley & Sons to increase its market reach. RR Donnelley & Sons 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 RR Donnelley & Sons 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 RR Donnelley & Sons to hire the very best people irrespective of their geographical location.
Manufacturing automation
– RR Donnelley & Sons can use the latest technology developments to improve its manufacturing and designing process in Printing Services sector. 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 in Printing Services industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for RR Donnelley & Sons in the Printing Services industry. Now RR Donnelley & Sons can target international markets with far fewer capital restrictions requirements than the existing system.
Loyalty marketing
– RR Donnelley & Sons 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.
Using analytics as competitive advantage
– RR Donnelley & Sons has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Printing Services sector. This continuous investment in analytics has enabled RR Donnelley & Sons to build a competitive advantage using analytics. The analytics driven competitive advantage can help RR Donnelley & Sons to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, RR Donnelley & Sons can use these opportunities to build new business models that can help the communities that RR Donnelley & Sons operates in. Secondly it can use opportunities from government spending in Printing Services sector.
Building a culture of innovation
– managers at RR Donnelley & Sons 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 Printing Services industry.
Threats RR Donnelley & Sons External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of RR Donnelley & Sons are -
Shortening product life cycle
– it is one of the major threat that RR Donnelley & Sons is facing in Printing Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Easy access to finance
– Easy access to finance in Printing Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. RR Donnelley & Sons can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 RR Donnelley & Sons.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, RR Donnelley & Sons may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Printing Services 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.
Consumer confidence and its impact on RR Donnelley & Sons 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 Printing Services 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. RR Donnelley & Sons 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, RR Donnelley & Sons 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 RR Donnelley & Sons prominent markets.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. RR Donnelley & Sons needs to understand the core reasons impacting the Printing Services industry. This will help it in building a better workplace.
High dependence on third party suppliers
– RR Donnelley & Sons 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for RR Donnelley & Sons in Printing Services industry. The Printing Services 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.
Regulatory challenges
– RR Donnelley & Sons 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 Printing Services industry regulations.
Weighted SWOT Analysis of RR Donnelley & Sons Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at RR Donnelley & Sons 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 RR Donnelley & Sons 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 RR Donnelley & Sons 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 RR Donnelley & Sons 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 RR Donnelley & Sons needs to make to build a sustainable competitive advantage.