Case Study Description of Ebao Technology: An E-Insurance Enabler
Ebao is a year-old web-based technology company whose founders believe that their e-insurance programs and products have the potential to improve the overall efficiency of China's traditional insurance industry. In its first year of operation, Ebao has grown into a 70-person organization with offices in Shanghai and Beijing, and almost all of the major insurance companies in China have signed up with the company's web site and are using its e-insurance applications. Ebao's CEO and founder has a long list of challenges to confront in the coming year. The company needs to strengthen its market position in the face of rapidly growing competition and to sustain its rapid growth in a year full of market downturns. As well, Ebao's management team has targeted to achieve break-even by the end of the current year. The company's CEO must determine a concrete business strategy that will lead Ebao onto the next stage of success. His challenge is to build competitive advantage in the new Internet industry and in an emerging market.
Swot Analysis of "Ebao Technology: An E-Insurance Enabler" written by Mary M. Crossan, Tianshu Ru includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Ebao Insurance facing as an external strategic factors. Some of the topics covered in Ebao Technology: An E-Insurance Enabler case study are - Strategic Management Strategies, and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Ebao Technology: An E-Insurance Enabler casestudy better are - – digital marketing is dominated by two big players Facebook and Google, talent flight as more people leaving formal jobs, supply chains are disrupted by pandemic , increasing government debt because of Covid-19 spendings, geopolitical disruptions, increasing household debt because of falling income levels, increasing transportation and logistics costs,
wage bills are increasing, banking and financial system is disrupted by Bitcoin and other crypto currencies, etc
Introduction to SWOT Analysis of Ebao Technology: An E-Insurance Enabler
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Ebao Technology: An E-Insurance Enabler case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Ebao Insurance, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Ebao Insurance 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 Ebao Technology: An E-Insurance Enabler can be done for the following purposes –
1. Strategic planning using facts provided in Ebao Technology: An E-Insurance Enabler case study
2. Improving business portfolio management of Ebao Insurance
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Ebao Insurance
Strengths Ebao Technology: An E-Insurance Enabler | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Ebao Insurance in Ebao Technology: An E-Insurance Enabler Harvard Business Review case study are -
Superior customer experience
– The customer experience strategy of Ebao Insurance in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to lead change in Strategy & Execution field
– Ebao Insurance 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 Ebao Insurance in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Learning organization
- Ebao Insurance is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Ebao Insurance is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Ebao Technology: An E-Insurance Enabler Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Low bargaining power of suppliers
– Suppliers of Ebao Insurance in the sector have low bargaining power. Ebao Technology: An E-Insurance Enabler has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Ebao Insurance to manage not only supply disruptions but also source products at highly competitive prices.
Sustainable margins compare to other players in Strategy & Execution industry
– Ebao Technology: An E-Insurance Enabler firm has clearly differentiated products in the market place. This has enabled Ebao Insurance to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Ebao Insurance to invest into research and development (R&D) and innovation.
Innovation driven organization
– Ebao Insurance is one of the most innovative firm in sector. Manager in Ebao Technology: An E-Insurance Enabler 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
– Ebao Insurance is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to recruit top talent
– Ebao Insurance is one of the leading recruiters in the industry. Managers in the Ebao Technology: An E-Insurance Enabler are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
High switching costs
– The high switching costs that Ebao Insurance 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.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Ebao Insurance digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Ebao Insurance 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.
Analytics focus
– Ebao Insurance is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Mary M. Crossan, Tianshu Ru can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
High brand equity
– Ebao Insurance has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Ebao Insurance to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses Ebao Technology: An E-Insurance Enabler | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Ebao Technology: An E-Insurance Enabler are -
Workers concerns about automation
– As automation is fast increasing in the segment, Ebao Insurance 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.
Aligning sales with marketing
– It come across in the case study Ebao Technology: An E-Insurance Enabler that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Ebao Technology: An E-Insurance Enabler can leverage the sales team experience to cultivate customer relationships as Ebao Insurance is planning to shift buying processes online.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Ebao Technology: An E-Insurance Enabler 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 Ebao Insurance has relatively successful track record of launching new products.
High operating costs
– Compare to the competitors, firm in the HBR case study Ebao Technology: An E-Insurance Enabler 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 Ebao Insurance 's lucrative customers.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Ebao Technology: An E-Insurance Enabler, in the dynamic environment Ebao Insurance has struggled to respond to the nimble upstart competition. Ebao Insurance has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to strategic competitive environment developments
– As Ebao Technology: An E-Insurance Enabler HBR case study mentions - Ebao Insurance 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.
Capital Spending Reduction
– Even during the low interest decade, Ebao Insurance 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.
High cash cycle compare to competitors
Ebao Insurance 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.
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 Ebao Insurance supply chain. Even after few cautionary changes mentioned in the HBR case study - Ebao Technology: An E-Insurance Enabler, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Ebao Insurance vulnerable to further global disruptions in South East Asia.
Slow decision making process
– As mentioned earlier in the report, Ebao Insurance 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. Ebao Insurance 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 bargaining power of channel partners
– Because of the regulatory requirements, Mary M. Crossan, Tianshu Ru suggests that, Ebao Insurance is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Opportunities Ebao Technology: An E-Insurance Enabler | 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 Ebao Technology: An E-Insurance Enabler are -
Buying journey improvements
– Ebao Insurance can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Ebao Technology: An E-Insurance Enabler suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Strategy & Execution industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Ebao Insurance 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. Ebao Insurance 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.
Creating value in data economy
– The success of analytics program of Ebao Insurance has opened avenues for new revenue streams for the organization in the industry. This can help Ebao Insurance to build a more holistic ecosystem as suggested in the Ebao Technology: An E-Insurance Enabler case study. Ebao Insurance can build new products and services such as - data insight services, data privacy related products, data based consulting services, 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 Ebao Insurance in the consumer business. Now Ebao Insurance can target international markets with far fewer capital restrictions requirements than the existing system.
Loyalty marketing
– Ebao Insurance 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Ebao Insurance 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.
Using analytics as competitive advantage
– Ebao Insurance 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 Ebao Technology: An E-Insurance Enabler - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Ebao Insurance to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Ebao Insurance is facing challenges because of the dominance of functional experts in the organization. Ebao Technology: An E-Insurance Enabler 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.
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. Ebao Insurance can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Developing new processes and practices
– Ebao Insurance can develop new processes and procedures in Strategy & Execution 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Strategy & Execution industry, but it has also influenced the consumer preferences. Ebao Insurance can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Ebao Insurance 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, Ebao Technology: An E-Insurance Enabler, 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
– Ebao Insurance can use the latest technology developments to improve its manufacturing and designing process in Strategy & Execution 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 Ebao Technology: An E-Insurance Enabler External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Ebao Technology: An E-Insurance Enabler are -
Easy access to finance
– Easy access to finance in Strategy & Execution field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Ebao Insurance can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Stagnating economy with rate increase
– Ebao Insurance 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.
Consumer confidence and its impact on Ebao Insurance 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 acceleration in Forth Industrial Revolution
– Ebao Insurance has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Ebao Insurance needs to keep up with the evolution of technology in the Strategy & Execution 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.
Shortening product life cycle
– it is one of the major threat that Ebao Insurance is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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.
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. Ebao Insurance 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Ebao Insurance 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 Ebao Technology: An E-Insurance Enabler .
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. Ebao Insurance needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
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.
High dependence on third party suppliers
– Ebao Insurance 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.
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 Ebao Insurance.
Increasing wage structure of Ebao Insurance
– 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 Ebao Insurance.
Weighted SWOT Analysis of Ebao Technology: An E-Insurance Enabler 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 Ebao Technology: An E-Insurance Enabler 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 Ebao Technology: An E-Insurance Enabler 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 Ebao Technology: An E-Insurance Enabler 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 Ebao Technology: An E-Insurance Enabler 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 Ebao Insurance needs to make to build a sustainable competitive advantage.