Case Study Description of Ventro: Builder of B2B Businesses (Condensed)
Enables a condensed analysis of Ventro (formerly known as Chemdex), which builds and operates multiple B2B marketplace companies. Part of the Building-E-Business Online series.
Swot Analysis of "Ventro: Builder of B2B Businesses (Condensed)" written by Lynda M. Applegate, Meredith Collura includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Ventro Condensed facing as an external strategic factors. Some of the topics covered in Ventro: Builder of B2B Businesses (Condensed) case study are - Strategic Management Strategies, Entrepreneurship, Internet, Leadership, Organizational culture and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Ventro: Builder of B2B Businesses (Condensed) casestudy better are - – digital marketing is dominated by two big players Facebook and Google, supply chains are disrupted by pandemic , customer relationship management is fast transforming because of increasing concerns over data privacy, wage bills are increasing, cloud computing is disrupting traditional business models, increasing energy prices, increasing government debt because of Covid-19 spendings,
there is increasing trade war between United States & China, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of Ventro: Builder of B2B Businesses (Condensed)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Ventro: Builder of B2B Businesses (Condensed) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Ventro Condensed, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Ventro Condensed 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 Ventro: Builder of B2B Businesses (Condensed) can be done for the following purposes –
1. Strategic planning using facts provided in Ventro: Builder of B2B Businesses (Condensed) case study
2. Improving business portfolio management of Ventro Condensed
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 Ventro Condensed
Strengths Ventro: Builder of B2B Businesses (Condensed) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Ventro Condensed in Ventro: Builder of B2B Businesses (Condensed) Harvard Business Review case study are -
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Ventro Condensed digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Ventro Condensed 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.
Low bargaining power of suppliers
– Suppliers of Ventro Condensed in the sector have low bargaining power. Ventro: Builder of B2B Businesses (Condensed) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Ventro Condensed to manage not only supply disruptions but also source products at highly competitive prices.
Successful track record of launching new products
– Ventro Condensed has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Ventro Condensed 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.
Training and development
– Ventro Condensed has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Ventro: Builder of B2B Businesses (Condensed) 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.
Diverse revenue streams
– Ventro Condensed is present in almost all the verticals within the industry. This has provided firm in Ventro: Builder of B2B Businesses (Condensed) 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.
Strong track record of project management
– Ventro Condensed is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Highly skilled collaborators
– Ventro Condensed 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 Ventro: Builder of B2B Businesses (Condensed) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High switching costs
– The high switching costs that Ventro Condensed 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.
Sustainable margins compare to other players in Strategy & Execution industry
– Ventro: Builder of B2B Businesses (Condensed) firm has clearly differentiated products in the market place. This has enabled Ventro Condensed to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Ventro Condensed to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Ventro Condensed 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.
Operational resilience
– The operational resilience strategy in the Ventro: Builder of B2B Businesses (Condensed) 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.
Ability to lead change in Strategy & Execution field
– Ventro Condensed 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 Ventro Condensed in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Weaknesses Ventro: Builder of B2B Businesses (Condensed) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Ventro: Builder of B2B Businesses (Condensed) are -
Capital Spending Reduction
– Even during the low interest decade, Ventro Condensed 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Ventro Condensed 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.
No frontier risks strategy
– After analyzing the HBR case study Ventro: Builder of B2B Businesses (Condensed), it seems that company is thinking about the frontier risks that can impact Strategy & Execution 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.
Increasing silos among functional specialists
– The organizational structure of Ventro Condensed is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Ventro Condensed needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Ventro Condensed to focus more on services rather than just following the product oriented approach.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Ventro: Builder of B2B Businesses (Condensed), is just above the industry average. Ventro Condensed 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Lynda M. Applegate, Meredith Collura suggests that, Ventro Condensed 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.
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 Ventro Condensed supply chain. Even after few cautionary changes mentioned in the HBR case study - Ventro: Builder of B2B Businesses (Condensed), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Ventro Condensed vulnerable to further global disruptions in South East Asia.
Aligning sales with marketing
– It come across in the case study Ventro: Builder of B2B Businesses (Condensed) 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 Ventro: Builder of B2B Businesses (Condensed) can leverage the sales team experience to cultivate customer relationships as Ventro Condensed is planning to shift buying processes online.
Need for greater diversity
– Ventro Condensed 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.
Slow to strategic competitive environment developments
– As Ventro: Builder of B2B Businesses (Condensed) HBR case study mentions - Ventro Condensed 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.
High cash cycle compare to competitors
Ventro Condensed 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.
Opportunities Ventro: Builder of B2B Businesses (Condensed) | 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 Ventro: Builder of B2B Businesses (Condensed) are -
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. Ventro Condensed can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Leveraging digital technologies
– Ventro Condensed 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.
Loyalty marketing
– Ventro Condensed 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.
Learning at scale
– Online learning technologies has now opened space for Ventro Condensed 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Ventro Condensed is facing challenges because of the dominance of functional experts in the organization. Ventro: Builder of B2B Businesses (Condensed) 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.
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 Ventro Condensed 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Ventro Condensed in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Strategy & Execution segment, and it will provide faster access to the consumers.
Manufacturing automation
– Ventro Condensed 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Ventro Condensed can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Ventro Condensed in the consumer business. Now Ventro Condensed can target international markets with far fewer capital restrictions requirements than the existing system.
Building a culture of innovation
– managers at Ventro Condensed 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 Strategy & Execution segment.
Developing new processes and practices
– Ventro Condensed 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Ventro Condensed can use these opportunities to build new business models that can help the communities that Ventro Condensed operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Threats Ventro: Builder of B2B Businesses (Condensed) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Ventro: Builder of B2B Businesses (Condensed) are -
Stagnating economy with rate increase
– Ventro Condensed 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Ventro Condensed 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 Ventro: Builder of B2B Businesses (Condensed) .
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 Ventro Condensed business can come under increasing regulations regarding data privacy, data security, etc.
Shortening product life cycle
– it is one of the major threat that Ventro Condensed is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Ventro Condensed needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Technology acceleration in Forth Industrial Revolution
– Ventro Condensed has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Ventro Condensed 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Ventro Condensed with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Ventro: Builder of B2B Businesses (Condensed), Ventro Condensed may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Strategy & Execution .
High dependence on third party suppliers
– Ventro Condensed 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 Ventro Condensed.
Increasing wage structure of Ventro Condensed
– 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 Ventro Condensed.
Weighted SWOT Analysis of Ventro: Builder of B2B Businesses (Condensed) 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 Ventro: Builder of B2B Businesses (Condensed) 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 Ventro: Builder of B2B Businesses (Condensed) 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 Ventro: Builder of B2B Businesses (Condensed) 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 Ventro: Builder of B2B Businesses (Condensed) 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 Ventro Condensed needs to make to build a sustainable competitive advantage.