Mekong Capital: Building a Culture of Leadership in Vietnam SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Organizational Development
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Mekong Capital: Building a Culture of Leadership in Vietnam
Mekong Capital, a private equity firm specializing in investing in Vietnam, had grown dramatically since its inception in 2002 and faced numerous organizational issues in 2007. There was a shortage of qualified middle managers, an overall lack of leadership, and a culture of making excuses for performance shortfalls. These issues not only plagued Mekong, but also the portfolio companies that they took positions in. The case recounts how the founder and managing partner of Mekong undertook a process to profoundly change the culture, leadership, and accountability within the company to try to transform it so that its people would align and come together as a team, holding themselves responsible to deliver results and committed to the long-term future.
Authors :: Christopher Marquis, Vinay Ganti, Kevin Smith, Doug Guthrie
Swot Analysis of "Mekong Capital: Building a Culture of Leadership in Vietnam" written by Christopher Marquis, Vinay Ganti, Kevin Smith, Doug Guthrie includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Mekong Vietnam facing as an external strategic factors. Some of the topics covered in Mekong Capital: Building a Culture of Leadership in Vietnam case study are - Strategic Management Strategies, Entrepreneurial finance, Financial management, Leadership, Organizational culture and Organizational Development.
Some of the macro environment factors that can be used to understand the Mekong Capital: Building a Culture of Leadership in Vietnam casestudy better are - – there is increasing trade war between United States & China, geopolitical disruptions, increasing inequality as vast percentage of new income is going to the top 1%, wage bills are increasing, increasing commodity prices, increasing energy prices, talent flight as more people leaving formal jobs,
increasing government debt because of Covid-19 spendings, there is backlash against globalization, etc
Introduction to SWOT Analysis of Mekong Capital: Building a Culture of Leadership in Vietnam
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Mekong Capital: Building a Culture of Leadership in Vietnam case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Mekong Vietnam, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Mekong Vietnam 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 Mekong Capital: Building a Culture of Leadership in Vietnam can be done for the following purposes –
1. Strategic planning using facts provided in Mekong Capital: Building a Culture of Leadership in Vietnam case study
2. Improving business portfolio management of Mekong Vietnam
3. Assessing feasibility of the new initiative in Organizational Development field.
4. Making a Organizational Development topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Mekong Vietnam
Strengths Mekong Capital: Building a Culture of Leadership in Vietnam | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Mekong Vietnam in Mekong Capital: Building a Culture of Leadership in Vietnam Harvard Business Review case study are -
Organizational Resilience of Mekong Vietnam
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Mekong Vietnam does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Mekong Vietnam is one of the leading recruiters in the industry. Managers in the Mekong Capital: Building a Culture of Leadership in Vietnam are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Cross disciplinary teams
– Horizontal connected teams at the Mekong Vietnam 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)
– Mekong Vietnam 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 Mekong Capital: Building a Culture of Leadership in Vietnam - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Highly skilled collaborators
– Mekong Vietnam has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Mekong Capital: Building a Culture of Leadership in Vietnam HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Strong track record of project management
– Mekong Vietnam is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High switching costs
– The high switching costs that Mekong Vietnam 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.
Training and development
– Mekong Vietnam has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Mekong Capital: Building a Culture of Leadership in Vietnam 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.
Low bargaining power of suppliers
– Suppliers of Mekong Vietnam in the sector have low bargaining power. Mekong Capital: Building a Culture of Leadership in Vietnam has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Mekong Vietnam to manage not only supply disruptions but also source products at highly competitive prices.
Digital Transformation in Organizational Development segment
- digital transformation varies from industry to industry. For Mekong Vietnam digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Mekong Vietnam 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.
Operational resilience
– The operational resilience strategy in the Mekong Capital: Building a Culture of Leadership in Vietnam Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
High brand equity
– Mekong Vietnam has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Mekong Vietnam to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses Mekong Capital: Building a Culture of Leadership in Vietnam | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Mekong Capital: Building a Culture of Leadership in Vietnam are -
High cash cycle compare to competitors
Mekong Vietnam 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.
Lack of clear differentiation of Mekong Vietnam products
– To increase the profitability and margins on the products, Mekong Vietnam needs to provide more differentiated products than what it is currently offering in the marketplace.
Skills based hiring
– The stress on hiring functional specialists at Mekong Vietnam 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Mekong Capital: Building a Culture of Leadership in Vietnam, is just above the industry average. Mekong Vietnam 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.
Products dominated business model
– Even though Mekong Vietnam 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 - Mekong Capital: Building a Culture of Leadership in Vietnam should strive to include more intangible value offerings along with its core products and services.
Slow decision making process
– As mentioned earlier in the report, Mekong Vietnam has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Mekong Vietnam 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 operating costs
– Compare to the competitors, firm in the HBR case study Mekong Capital: Building a Culture of Leadership in Vietnam 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 Mekong Vietnam 's lucrative customers.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Mekong Vietnam is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Mekong Capital: Building a Culture of Leadership in Vietnam can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Interest costs
– Compare to the competition, Mekong Vietnam 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Mekong Capital: Building a Culture of Leadership in Vietnam, it seems that the employees of Mekong Vietnam 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 Mekong Capital: Building a Culture of Leadership in Vietnam, in the dynamic environment Mekong Vietnam has struggled to respond to the nimble upstart competition. Mekong Vietnam has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Opportunities Mekong Capital: Building a Culture of Leadership in Vietnam | 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 Mekong Capital: Building a Culture of Leadership in Vietnam are -
Leveraging digital technologies
– Mekong Vietnam 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, Mekong Vietnam is facing challenges because of the dominance of functional experts in the organization. Mekong Capital: Building a Culture of Leadership in Vietnam 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.
Creating value in data economy
– The success of analytics program of Mekong Vietnam has opened avenues for new revenue streams for the organization in the industry. This can help Mekong Vietnam to build a more holistic ecosystem as suggested in the Mekong Capital: Building a Culture of Leadership in Vietnam case study. Mekong Vietnam can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Organizational Development industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Mekong Vietnam 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. Mekong Vietnam 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Mekong Vietnam 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 Mekong Vietnam to hire the very best people irrespective of their geographical location.
Building a culture of innovation
– managers at Mekong Vietnam 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 Organizational Development segment.
Learning at scale
– Online learning technologies has now opened space for Mekong Vietnam 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.
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. Mekong Vietnam can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Better consumer reach
– The expansion of the 5G network will help Mekong Vietnam to increase its market reach. Mekong Vietnam 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Mekong Vietnam can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Mekong Vietnam 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, Mekong Capital: Building a Culture of Leadership in Vietnam, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Mekong Vietnam in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Organizational Development segment, and it will provide faster access to the consumers.
Manufacturing automation
– Mekong Vietnam can use the latest technology developments to improve its manufacturing and designing process in Organizational Development 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 Mekong Capital: Building a Culture of Leadership in Vietnam External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Mekong Capital: Building a Culture of Leadership in Vietnam are -
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. Mekong Vietnam 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.
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 Mekong Vietnam.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Mekong Vietnam 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 Mekong Capital: Building a Culture of Leadership in Vietnam .
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Mekong Capital: Building a Culture of Leadership in Vietnam, Mekong Vietnam may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Organizational Development .
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. Mekong Vietnam needs to understand the core reasons impacting the Organizational Development industry. This will help it in building a better workplace.
Easy access to finance
– Easy access to finance in Organizational Development field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Mekong Vietnam can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Shortening product life cycle
– it is one of the major threat that Mekong Vietnam is facing in Organizational Development sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Regulatory challenges
– Mekong Vietnam 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 Organizational Development industry regulations.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Mekong Vietnam in the Organizational Development industry. The Organizational Development 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.
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.
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 Mekong Vietnam business can come under increasing regulations regarding data privacy, data security, etc.
Increasing wage structure of Mekong Vietnam
– 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 Mekong Vietnam.
Weighted SWOT Analysis of Mekong Capital: Building a Culture of Leadership in Vietnam 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 Mekong Capital: Building a Culture of Leadership in Vietnam 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 Mekong Capital: Building a Culture of Leadership in Vietnam 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 Mekong Capital: Building a Culture of Leadership in Vietnam 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 Mekong Capital: Building a Culture of Leadership in Vietnam 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 Mekong Vietnam needs to make to build a sustainable competitive advantage.
