Health Insurance to the Base of the Pyramid SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Health Insurance to the Base of the Pyramid
The case describes a unique insurance scheme called Krupa Arogya Suraksha, promoted by the Shree Krishna Arogya Trust (Trust). The product was designed with the aim of extending basic health coverage to the "base-of-the-pyramid" (BoP) population at an affordable premium. The services were provided by Shree Krishna Hospital, of which the Trust was an associate. The Trust was looking at a win-win situation: in providing modern health services to a larger, lower-income group, the facilities and infrastructure of the hospital would be better utilized. In the five years since its creation, membership in the scheme had increased threefold to 43,000. These members/consumers accounted for 13 per cent of patients treated by the hospital. Thus, the twin objectives of extending affordable healthcare to the lower-income segment and increased utilization of the facilities at the hospital were achieved to some extent. However, the Trust was not able to meet the cost of the health care offered under the scheme from the premiums collected and was dependent on donors to absorb the shortfall. The Trust's management was concerned about the sustainability of such an arrangement and was looking for ways to make the scheme pay for itself.
Swot Analysis of "Health Insurance to the Base of the Pyramid" written by Suresh B.P., S.R. Asokan includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Trust Scheme facing as an external strategic factors. Some of the topics covered in Health Insurance to the Base of the Pyramid case study are - Strategic Management Strategies, Personnel policies, Strategy and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Health Insurance to the Base of the Pyramid casestudy better are - – there is increasing trade war between United States & China, increasing government debt because of Covid-19 spendings, wage bills are increasing, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing household debt because of falling income levels, cloud computing is disrupting traditional business models, increasing transportation and logistics costs,
geopolitical disruptions, increasing commodity prices, etc
Introduction to SWOT Analysis of Health Insurance to the Base of the Pyramid
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Health Insurance to the Base of the Pyramid case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Trust Scheme, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Trust Scheme 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 Health Insurance to the Base of the Pyramid can be done for the following purposes –
1. Strategic planning using facts provided in Health Insurance to the Base of the Pyramid case study
2. Improving business portfolio management of Trust Scheme
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Trust Scheme
Strengths Health Insurance to the Base of the Pyramid | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Trust Scheme in Health Insurance to the Base of the Pyramid Harvard Business Review case study are -
Operational resilience
– The operational resilience strategy in the Health Insurance to the Base of the Pyramid 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.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Trust Scheme digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Trust Scheme 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.
Strong track record of project management
– Trust Scheme is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Effective Research and Development (R&D)
– Trust Scheme 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 Health Insurance to the Base of the Pyramid - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Innovation driven organization
– Trust Scheme is one of the most innovative firm in sector. Manager in Health Insurance to the Base of the Pyramid Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
High switching costs
– The high switching costs that Trust Scheme 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.
Successful track record of launching new products
– Trust Scheme has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Trust Scheme 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 Sales & Marketing field
– Trust Scheme 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 Trust Scheme in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High brand equity
– Trust Scheme has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Trust Scheme to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Superior customer experience
– The customer experience strategy of Trust Scheme in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Organizational Resilience of Trust Scheme
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Trust Scheme does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Cross disciplinary teams
– Horizontal connected teams at the Trust Scheme 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.
Weaknesses Health Insurance to the Base of the Pyramid | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Health Insurance to the Base of the Pyramid are -
Need for greater diversity
– Trust Scheme 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.
No frontier risks strategy
– After analyzing the HBR case study Health Insurance to the Base of the Pyramid, it seems that company is thinking about the frontier risks that can impact Sales & Marketing strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Capital Spending Reduction
– Even during the low interest decade, Trust Scheme has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Trust Scheme is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Health Insurance to the Base of the Pyramid can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Lack of clear differentiation of Trust Scheme products
– To increase the profitability and margins on the products, Trust Scheme needs to provide more differentiated products than what it is currently offering in the marketplace.
High operating costs
– Compare to the competitors, firm in the HBR case study Health Insurance to the Base of the Pyramid 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 Trust Scheme 's lucrative customers.
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 Trust Scheme supply chain. Even after few cautionary changes mentioned in the HBR case study - Health Insurance to the Base of the Pyramid, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Trust Scheme vulnerable to further global disruptions in South East Asia.
Slow decision making process
– As mentioned earlier in the report, Trust Scheme 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. Trust Scheme 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.
Slow to strategic competitive environment developments
– As Health Insurance to the Base of the Pyramid HBR case study mentions - Trust Scheme takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Health Insurance to the Base of the Pyramid, it seems that the employees of Trust Scheme 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Health Insurance to the Base of the Pyramid, is just above the industry average. Trust Scheme 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.
Opportunities Health Insurance to the Base of the Pyramid | 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 Health Insurance to the Base of the Pyramid are -
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Sales & Marketing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Trust Scheme 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. Trust Scheme 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Trust Scheme 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.
Loyalty marketing
– Trust Scheme 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
– Trust Scheme has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Health Insurance to the Base of the Pyramid - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Trust Scheme to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Creating value in data economy
– The success of analytics program of Trust Scheme has opened avenues for new revenue streams for the organization in the industry. This can help Trust Scheme to build a more holistic ecosystem as suggested in the Health Insurance to the Base of the Pyramid case study. Trust Scheme can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at Trust Scheme 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 Sales & Marketing segment.
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 Trust Scheme in the consumer business. Now Trust Scheme can target international markets with far fewer capital restrictions requirements than the existing system.
Leveraging digital technologies
– Trust Scheme 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, Trust Scheme is facing challenges because of the dominance of functional experts in the organization. Health Insurance to the Base of the Pyramid 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Trust Scheme 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, Health Insurance to the Base of the Pyramid, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Manufacturing automation
– Trust Scheme can use the latest technology developments to improve its manufacturing and designing process in Sales & Marketing 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Trust Scheme 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 Trust Scheme to hire the very best people irrespective of their geographical location.
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. Trust Scheme can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats Health Insurance to the Base of the Pyramid External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Health Insurance to the Base of the Pyramid are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Trust Scheme 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 Health Insurance to the Base of the Pyramid .
Environmental challenges
– Trust Scheme 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. Trust Scheme can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Health Insurance to the Base of the Pyramid, Trust Scheme may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Sales & Marketing .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Trust Scheme in the Sales & Marketing industry. The Sales & Marketing 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.
High dependence on third party suppliers
– Trust Scheme 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.
Consumer confidence and its impact on Trust Scheme 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.
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.
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 Trust Scheme.
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. Trust Scheme 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.
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. Trust Scheme needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Regulatory challenges
– Trust Scheme 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 Sales & Marketing industry regulations.
Stagnating economy with rate increase
– Trust Scheme can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
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 Trust Scheme in the Sales & Marketing sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Health Insurance to the Base of the Pyramid 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 Health Insurance to the Base of the Pyramid 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 Health Insurance to the Base of the Pyramid 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 Health Insurance to the Base of the Pyramid 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 Health Insurance to the Base of the Pyramid 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 Trust Scheme needs to make to build a sustainable competitive advantage.
