Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study Description of Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis
Describes T.P. Lee, the founder and CEO of Jinwoong, a 19-year-old entrepreneurial company in Korea that has grown to become the world's largest manufacturer of camping tents. Labeled by Fortune as one of the most promising entrepreneurs in Asia in 1993, Lee faces some serious management challenges by October 1998. Largely due to the Korean financial crisis of 1997-98, Lee must rethink the financing and expansion plans for his firm. To deal with these challenges, he could seek outside funding from two different groups of private equity investors or from a corporate restructuring fund set up by the Korean government. All of these decisions reflect Jinwoong's long-term strategy and Lee's assessment of the different offers.
Authors :: Walter Kuemmerle, James Lee, Bokeun Jin
Swot Analysis of "Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis" written by Walter Kuemmerle, James Lee, Bokeun Jin includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Jinwoong Korean facing as an external strategic factors. Some of the topics covered in Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis case study are - Strategic Management Strategies, Emerging markets, Entrepreneurial finance, Financial management, Globalization, Growth strategy, Recession, Reorganization and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis casestudy better are - – wage bills are increasing, geopolitical disruptions, increasing transportation and logistics costs, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing inequality as vast percentage of new income is going to the top 1%, there is backlash against globalization, challanges to central banks by blockchain based private currencies,
supply chains are disrupted by pandemic , increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Jinwoong Korean, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Jinwoong Korean 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 Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis can be done for the following purposes –
1. Strategic planning using facts provided in Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis case study
2. Improving business portfolio management of Jinwoong Korean
3. Assessing feasibility of the new initiative in Finance & Accounting field.
4. Making a Finance & Accounting topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Jinwoong Korean
Strengths Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Jinwoong Korean in Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis Harvard Business Review case study are -
Successful track record of launching new products
– Jinwoong Korean has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Jinwoong Korean 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 Finance & Accounting field
– Jinwoong Korean 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 Jinwoong Korean in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High brand equity
– Jinwoong Korean has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Jinwoong Korean to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Highly skilled collaborators
– Jinwoong Korean 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 Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Diverse revenue streams
– Jinwoong Korean is present in almost all the verticals within the industry. This has provided firm in Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis case study 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.
Training and development
– Jinwoong Korean has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis 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.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Jinwoong Korean digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Jinwoong Korean 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.
Innovation driven organization
– Jinwoong Korean is one of the most innovative firm in sector. Manager in Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Strong track record of project management
– Jinwoong Korean is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Sustainable margins compare to other players in Finance & Accounting industry
– Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis firm has clearly differentiated products in the market place. This has enabled Jinwoong Korean to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Jinwoong Korean to invest into research and development (R&D) and innovation.
Ability to recruit top talent
– Jinwoong Korean is one of the leading recruiters in the industry. Managers in the Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Superior customer experience
– The customer experience strategy of Jinwoong Korean in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis are -
High operating costs
– Compare to the competitors, firm in the HBR case study Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis 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 Jinwoong Korean 's lucrative customers.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Jinwoong Korean is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Jinwoong Korean 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.
Slow decision making process
– As mentioned earlier in the report, Jinwoong Korean 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. Jinwoong Korean 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.
Interest costs
– Compare to the competition, Jinwoong Korean 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.
Low market penetration in new markets
– Outside its home market of Jinwoong Korean, firm in the HBR case study Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Jinwoong Korean has relatively successful track record of launching new products.
High cash cycle compare to competitors
Jinwoong Korean 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.
Skills based hiring
– The stress on hiring functional specialists at Jinwoong Korean 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.
Need for greater diversity
– Jinwoong Korean 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.
Lack of clear differentiation of Jinwoong Korean products
– To increase the profitability and margins on the products, Jinwoong Korean needs to provide more differentiated products than what it is currently offering in the marketplace.
Opportunities Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis | 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 Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis are -
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Finance & Accounting industry, but it has also influenced the consumer preferences. Jinwoong Korean 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 Jinwoong Korean 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.
Creating value in data economy
– The success of analytics program of Jinwoong Korean has opened avenues for new revenue streams for the organization in the industry. This can help Jinwoong Korean to build a more holistic ecosystem as suggested in the Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis case study. Jinwoong Korean can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Loyalty marketing
– Jinwoong Korean 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.
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 Jinwoong Korean in the consumer business. Now Jinwoong Korean can target international markets with far fewer capital restrictions requirements than the existing system.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Finance & Accounting industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Jinwoong Korean 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. Jinwoong Korean 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Jinwoong Korean in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Finance & Accounting segment, and it will provide faster access to the consumers.
Low interest rates
– Even though inflation is raising its head in most developed economies, Jinwoong Korean 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.
Better consumer reach
– The expansion of the 5G network will help Jinwoong Korean to increase its market reach. Jinwoong Korean 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.
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. Jinwoong Korean can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Developing new processes and practices
– Jinwoong Korean can develop new processes and procedures in Finance & Accounting 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.
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 Jinwoong Korean 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.
Leveraging digital technologies
– Jinwoong Korean 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.
Threats Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis are -
High dependence on third party suppliers
– Jinwoong Korean 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 Jinwoong Korean in the Finance & Accounting industry. The Finance & Accounting 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.
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 Jinwoong Korean in the Finance & Accounting sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– Jinwoong Korean has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Jinwoong Korean needs to keep up with the evolution of technology in the Finance & Accounting sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Environmental challenges
– Jinwoong Korean 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. Jinwoong Korean can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
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. Jinwoong Korean needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
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 Jinwoong Korean.
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. Jinwoong Korean 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.
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 Jinwoong Korean business can come under increasing regulations regarding data privacy, data security, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Jinwoong Korean 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 Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis .
Regulatory challenges
– Jinwoong Korean 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 Finance & Accounting industry regulations.
Consumer confidence and its impact on Jinwoong Korean 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.
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.
Weighted SWOT Analysis of Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis 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 Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis 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 Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis 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 Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis 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 Jinwoong: Financing an Entrepreneurial Firm in the Wake of the Korean Financial Crisis 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 Jinwoong Korean needs to make to build a sustainable competitive advantage.
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