Dynamic Capabilities Based Entrepreneurial Theory - Free Samples

Question: Discuss about the Dynamic Capabilities Based Entrepreneurial Theory. Answer: Introduction: From the given case study, there are various micro environmental factors being identified that had affected the business of Fit Bit in their business operations. SWOT analysis will be used in order to identify these factors. Strengths Since of the inception of their business, the key strength for Fit Bit is their innovative products. Their one of the kind products is having less competition in the market. Another strength of them is the corporate penetration. As per the information in the case study, different corporations are booking in bulk, which enhanced their capital flow in less time during their initial days. Weaknesses One of the major weaknesses identified in the initial stage of Fit Bit is the hardware issues. The device was not ready to launch even with number of booking already made. In the initial stage, the do not have the required capital to develop the products more sophistically. Opportunities Increase in the health concerns among the new age customers is increasing the business opportunities for devices of Fit Bit (Dontje et al., 2015). According to the data in the case study given, customer retention rate in the corporate in terms of the usage of the Fit Bit devices. Thus, the more will be the corporate retention, the more will be the market opportunities. Threats As per the information in the case study, one of the major threats for Fit Bit is the wearable devices from Apple. These devices are far more superiors than the Fit Bit. Thus, the customers will get more attracted. Another challenge is the rapid advancement of the technologies in electronic gadgets sector. This is difficult for Fit Bit to frequently update their technologies. Another threat is the customer concern regarding the privacy issues. In the recent time, breach of privacy created huge stir in the market. This may made customer skeptical about using Fit Bit. Determination of the macro environmental factors of Fit Bit Political Fit Bit has to adhere with the rules and regulations of different countries in relation to the user privacy. Thus, they are having the issues of considering the security measures in order to protect the privacy. Different countries are having different rules and legislations. Thus when Fit Bit entered in foreign markets, they faced the issue of adhering to the local legislations. This becomes difficult for them to design their products in accordance to different rules and regulations. Economical The main economical challenge faced by them is the lack of capital in their initial stage of operation. This caused difficulty in developing their products. It was also a challenge for them to develop the products in innovative manner and with having affordable cost. Having the competition with the brands such as Apple, it is more difficult for Fit Bit to compete in the market. Social Customers are less satisfied with the fitness devices available before Fit Bit. It act an as opportunity for Fit Bit to fill the gap. Customers are more interested towards tracking their daily activities, which also creates market opportunities for Fit Bit. Designing the Fit Bit as wearable devices helped to enhance the social acceptability. This also increased the utility of the Fit Bit devices in the market. Technological Fit Bit when released was the most advanced fitness tracker in the market. During their initial stage, the key objective of Fit Bit was to initiate superior products compared to the available devices in the market. However, it is the challenge for them to launch newer products with latest technologies in order to keep up with the competition. Overcoming the threats One of the key strategies that can be initiated by Fit Bit in overcoming the threat and obstacles is the product diversification strategy. This is due to the reason that having more varied and diverse product will help them to reduce the business risk associated with having single products (Teece, 2014). In addition, having diverse product portfolio will help to cater to different customer segments at once. This is help in increasing the target customer base along with increasing the revenue stream. Another strategy that will help Fit Bit in overcoming the obstacles is the initiation of the market development. This strategy will also be beneficial for them due to the reason that the more market they will target, the more will be the market availability for the Fit Bit products (Titman, Wei Xie, 2013). Entering the markets where they are currently not having market presence will help them to increase the market share of the products of Fit Bit. The more will be their global markets, the less they will be dependent in their existing markets. Thus, the intensity of the competition faced by them will be less. Added factors affecting Fit Bit In the given case study, there are various factors being discussed, which affect Fit Bit in their business operation. However, apart from these factors, there are still a few factors, which are also affecting the business of them. The following section will discuss about some of these factors. In this case study, the political and legal factors are not discussed that can also affect the business profile of Fit Bit. This is due to the reason that different countries are having different legal rules and regulations, which should be adhered by Fit Bit. However, the products of Fit Bit are universal and standardized in nature (Tan Sousa, 2013). Hence, it will be difficult for them to meet the different legal regulations in different countries. On the otherhand, if the products are to be changed according to the legal regulations in different countries, then it will incur more cost for them. This extra cost will reduce the profitability of Fit Bit in their global operations. These marketing factors are not discussed in the case study, but it will affect the business operation of Fit Bit. Reference Dontje, M. L., de Groot, M., Lengton, R. R., van der Schans, C. P., Krijnen, W. P. (2015). Measuring steps with the Fitbit activity tracker: an inter-device reliability study.Journal of medical engineering technology,39(5), 286-290. Tan, Q., Sousa, C. M. (2013). International marketing standardization.Management international review,53(5), 711-739. Teece, D. J. (2014). A dynamic capabilities-based entrepreneurial theory of the multinational enterprise.Journal of International Business Studies,45(1), 8-37. Titman, S., Wei, K. J., Xie, F. (2013). Market development and the asset growth effect: International evidence.Journal of Financial and Quantitative Analysis,48(5), 1405-1432.