Case Study Description of Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture
Who are the right investors for a for-profit company targeting the world's poor? Before this start-up spends hundreds of hours pursuing venture capital (VC), Movirtu must decide whether a profit-oriented VC investment will fit its vision for both growth and social impact. Movirtu's "Cloud Phone" software is designed for the nearly one billion people who cannot afford mobile phones and, as a result, borrow phones from friends and family. Movirtu provides phone sharers with a private number that sends and receives calls. Movirtu already secured two seed-round impact investors, Gray Ghost Ventures and Grassroots Business Fund. For its next round of financing, Movirtu was approached by TLcom Capital, an experienced VC. Students must decide: will having TLcom as an investor allow Movirtu to not only survive but achieve maximum financial and social impact?
Swot Analysis of "Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture" written by Ted London includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Movirtu Movirtu's facing as an external strategic factors. Some of the topics covered in Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture case study are - Strategic Management Strategies, Economic development, Emerging markets, Venture capital and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture casestudy better are - – wage bills are increasing, challanges to central banks by blockchain based private currencies, banking and financial system is disrupted by Bitcoin and other crypto currencies, cloud computing is disrupting traditional business models, increasing commodity prices, supply chains are disrupted by pandemic , there is increasing trade war between United States & China,
customer relationship management is fast transforming because of increasing concerns over data privacy, there is backlash against globalization, etc
Introduction to SWOT Analysis of Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Movirtu Movirtu's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Movirtu Movirtu's 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 Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture can be done for the following purposes –
1. Strategic planning using facts provided in Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture case study
2. Improving business portfolio management of Movirtu Movirtu's
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 Movirtu Movirtu's
Strengths Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Movirtu Movirtu's in Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture Harvard Business Review case study are -
High brand equity
– Movirtu Movirtu's has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Movirtu Movirtu's to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– Movirtu Movirtu's is one of the most innovative firm in sector. Manager in Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Learning organization
- Movirtu Movirtu's 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 Movirtu Movirtu's is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Successful track record of launching new products
– Movirtu Movirtu's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Movirtu Movirtu's 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.
Strong track record of project management
– Movirtu Movirtu's 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 Strategy & Execution industry
– Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture firm has clearly differentiated products in the market place. This has enabled Movirtu Movirtu's to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Movirtu Movirtu's to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– Movirtu Movirtu's 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 Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Analytics focus
– Movirtu Movirtu's 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 Ted London 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.
Ability to lead change in Strategy & Execution field
– Movirtu Movirtu's 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 Movirtu Movirtu's in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Ability to recruit top talent
– Movirtu Movirtu's is one of the leading recruiters in the industry. Managers in the Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Organizational Resilience of Movirtu Movirtu's
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Movirtu Movirtu's does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Movirtu Movirtu's digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Movirtu Movirtu's 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.
Weaknesses Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture are -
Lack of clear differentiation of Movirtu Movirtu's products
– To increase the profitability and margins on the products, Movirtu Movirtu's needs to provide more differentiated products than what it is currently offering in the marketplace.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture 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 Movirtu Movirtu's has relatively successful track record of launching new products.
Slow to strategic competitive environment developments
– As Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture HBR case study mentions - Movirtu Movirtu's 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.
Increasing silos among functional specialists
– The organizational structure of Movirtu Movirtu's is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Movirtu Movirtu's needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Movirtu Movirtu's to focus more on services rather than just following the product oriented approach.
No frontier risks strategy
– After analyzing the HBR case study Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture, 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.
Need for greater diversity
– Movirtu Movirtu's 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 decision making process
– As mentioned earlier in the report, Movirtu Movirtu's 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. Movirtu Movirtu's even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
High operating costs
– Compare to the competitors, firm in the HBR case study Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture 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 Movirtu Movirtu's 's lucrative customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Movirtu Movirtu's 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 to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Movirtu Movirtu's is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Interest costs
– Compare to the competition, Movirtu Movirtu's 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.
Opportunities Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture | 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 Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture 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. Movirtu Movirtu's can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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. Movirtu Movirtu's can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Movirtu Movirtu's 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 Movirtu Movirtu's to hire the very best people irrespective of their geographical location.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Movirtu Movirtu's can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Loyalty marketing
– Movirtu Movirtu's 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
– Movirtu Movirtu's 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 Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Movirtu Movirtu's to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Low interest rates
– Even though inflation is raising its head in most developed economies, Movirtu Movirtu's 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.
Learning at scale
– Online learning technologies has now opened space for Movirtu Movirtu's 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.
Leveraging digital technologies
– Movirtu Movirtu's 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.
Buying journey improvements
– Movirtu Movirtu's can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture 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.
Building a culture of innovation
– managers at Movirtu Movirtu's 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.
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 Movirtu Movirtu's 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.
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. Movirtu Movirtu's 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. Movirtu Movirtu's 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.
Threats Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture, Movirtu Movirtu's 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 .
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Movirtu Movirtu's with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Movirtu Movirtu's will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Movirtu Movirtu's.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Movirtu Movirtu's in the Strategy & Execution industry. The Strategy & Execution 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Movirtu Movirtu's 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 Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture .
Shortening product life cycle
– it is one of the major threat that Movirtu Movirtu's is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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.
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. Movirtu Movirtu's can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
High dependence on third party suppliers
– Movirtu Movirtu's 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.
Environmental challenges
– Movirtu Movirtu's 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. Movirtu Movirtu's can take advantage of this fund but it will also bring new competitors in the Strategy & Execution 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. Movirtu Movirtu's needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Weighted SWOT Analysis of Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture 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 Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture 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 Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture 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 Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture 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 Movirtu's Cloud Phone Service: Funding a Base-of-the-Pyramid Venture 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 Movirtu Movirtu's needs to make to build a sustainable competitive advantage.