SWOT Analysis

A Resource Based View

A A Resource Based View Perspective Perspective

Your ‘Field of Play’

The Customer The Firm

The Environment

Strategy

Company Analysis

Resources and Capabilities

Core Business and Marketing Strategy

Marketing Mix

The Lake Wobegon Effect

Patents, human capital, financial capital, brand equity, firm culture, natural resources

Res

The

Resource Audit:Are basic assets a source of competitive advantage?

Financial Capital

Access to Human Capital

Talent of Human Capital

Access and Control of Natural Resources

Learning Orientation

Market Orientation

Brand Equity

Organizational Vision and Culture

Resource and Capabilities Audit:Where in the Value Chain is your source of competitive advantage?

Market Intelligence

R&D

Product Design

Manufacturing

Upstream Supply Chain Management

Downstream Distribution

Sales Force

Branding

Promotion

Customer Service

The Power of Bundling:Abstract Example

Resources + Capabilities = Competitive Advantage

Learning Orientation Product DesignInnovation SuperiorityMarket Orientation R&DHuman Capital Talent

The Power of Bundling

Bundling resources and capabilities is key to maximizing scarcity and immobility.

Southwest Airlines:• Single fuel efficient aircraft, the Boeing 737• Point to point route system• Target small markets in which it can dominate• No reservation service• No food service• Labor contracts stipulate employees can perform multiple tasks• Lease inexpensive gates at airports or use secondary airports

Strength Outcomes: Lower Cost, Superior Scheduling

Strengths and Weaknesses Identification

The Marketing EnvironmentThe Current Situation and Developing Trends

Competitive Intensity:The Most Misused Presumption in SWOT

Competitive Intensity:The Herfindahl Index

Competitive Intensity:The Propensity of Buyers to Engage in Brand Switching

Competitive Intensity:Conditions for Price Wars

Competitive Intensity:Conditions for ‘Paranoia’

Porter’s Five Forces:Opportunities/Threats to Firm Profitability

Porter’s ‘Five Forces’ are means to assess the probability that an industry’sProfits will be pressured downward through price competition

1. Intensity of Direct Competition

2. Ease of Entry

3. Presence of Substitutes

4. Supplier Power

5. Buyer Power

Environmental Threats and Opportunities

Threat and Opportunity Identification

SWOT Analysis

Common Mistakes in SWOT

Strengths (Weaknesses)We have a good (bad) productWe have been in business a long (short) timeWe have strong (weak) imageWe have strong (weak) brand equity

    Opportunities that do not have a basis in some event or change in the external environment arenot opportunities…ask yourself what in the environment is influencing your firm’s ability to do one of the following

We have the opportunity to increase salesWe have the opportunity to advertiseWe have the opportunity to innovate our product lineWe have the opportunity to improve customer satisfaction

 

Establish Specific Objectives

  1. A strength matched with an opportunity provides leverage (exploit the strategic window while you can) 

2. A strength matched with a threat is a vulnerability (monitor situation carefully)

 

3. A weakness matched with a threat provides a problem (strengthen weak links competitors may exploit)   4. A weakness matched with an opportunity is a constraint (inhibits your ability to exploit your opportunity) 

SWOT Analysis Example:Identify Strengths and Weaknesses

Key Strengths: Excel at verifying artifact authenticity

Quality reputation with dealers and collectors

Key Weaknesses: No proven expertise in the mass merchandise segment

No proven expertise in the low end replica market

Toucon Collections

SWOT Analysis Example:Identify Opportunities and Threats

Opportunities: Growth of low end replica market (contract offer)

Growing interest in authentic S.A. and African artificacts

Threats: Shrinking Supply of authentic artifacts

Presence of fakes increasing need for verifying authenticity

Growing number of competitors

Toucon Collections

SWOT Analysis Example:Establish Specific Objectives

Leverage: Use Toucon’s verification expertise to exploit the growingdemand for authentic S.A. and African artifacts.

Vulnerability: Focus on maintain strong relationships with dealers and collectors in the face of increasing competition and

an uncertain artifact environment.

Toucon Collections

SWOT Analysis Example:Establish Specific Objectives

Problem: A lack of product and distributor expertise as well as its lack of credibility could damage Toucon’s brand equity an relationships.

Constraint: The replica market may be lucrative but it does not fit Toucon’s expertise and could harm its core identity.

Toucon Collections

SWOT Analysis Example:Toucon Marketing Mix