Cash Technology Limited: A Chinese IPO in Singapore SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study SWOT Analysis Solution
Case Study Description of Cash Technology Limited: A Chinese IPO in Singapore
Cash Technology Limited is a Xiamen-based manufacturer of self-service banking machines, touchscreens and related software. The company was set to issue its initial public offering on the Singapore Exchange. The proceeds from the IPO would help the mid-sized, entrepreneurial and private company secure its position in the burgeoning Chinese market for automated teller machines and related equipment. With six weeks left before the IPO, the chief executive officer and chief financial officer attempted to value their company by various methods and assess the reasonableness of the offering price proposed by the IPO manager. The case challenges students to examine the attractiveness and value of a business from the perspective of the issuer and potential investors, and can also provide the opportunity for students to develop a strategy for communicating with institutional investors.
Swot Analysis of "Cash Technology Limited: A Chinese IPO in Singapore" written by Larry Wynant, Nigel Goodwin includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Ipo Machines facing as an external strategic factors. Some of the topics covered in Cash Technology Limited: A Chinese IPO in Singapore case study are - Strategic Management Strategies, Financial analysis and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Cash Technology Limited: A Chinese IPO in Singapore casestudy better are - – competitive advantages are harder to sustain because of technology dispersion, there is increasing trade war between United States & China, wage bills are increasing, talent flight as more people leaving formal jobs, increasing household debt because of falling income levels, banking and financial system is disrupted by Bitcoin and other crypto currencies, customer relationship management is fast transforming because of increasing concerns over data privacy,
cloud computing is disrupting traditional business models, there is backlash against globalization, etc
Introduction to SWOT Analysis of Cash Technology Limited: A Chinese IPO in Singapore
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Cash Technology Limited: A Chinese IPO in Singapore case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Ipo Machines, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Ipo Machines 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 Cash Technology Limited: A Chinese IPO in Singapore can be done for the following purposes –
1. Strategic planning using facts provided in Cash Technology Limited: A Chinese IPO in Singapore case study
2. Improving business portfolio management of Ipo Machines
3. Assessing feasibility of the new initiative in Finance & Accounting field.
4. Making a Finance & Accounting topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Ipo Machines
Strengths Cash Technology Limited: A Chinese IPO in Singapore | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Ipo Machines in Cash Technology Limited: A Chinese IPO in Singapore Harvard Business Review case study are -
Strong track record of project management
– Ipo Machines 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
– Ipo Machines is one of the leading recruiters in the industry. Managers in the Cash Technology Limited: A Chinese IPO in Singapore are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Learning organization
- Ipo Machines 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 Ipo Machines is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Cash Technology Limited: A Chinese IPO in Singapore Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Training and development
– Ipo Machines has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Cash Technology Limited: A Chinese IPO in Singapore 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.
Highly skilled collaborators
– Ipo Machines 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 Cash Technology Limited: A Chinese IPO in Singapore HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Operational resilience
– The operational resilience strategy in the Cash Technology Limited: A Chinese IPO in Singapore 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.
Superior customer experience
– The customer experience strategy of Ipo Machines in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Low bargaining power of suppliers
– Suppliers of Ipo Machines in the sector have low bargaining power. Cash Technology Limited: A Chinese IPO in Singapore has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Ipo Machines to manage not only supply disruptions but also source products at highly competitive prices.
Diverse revenue streams
– Ipo Machines is present in almost all the verticals within the industry. This has provided firm in Cash Technology Limited: A Chinese IPO in Singapore 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.
Innovation driven organization
– Ipo Machines is one of the most innovative firm in sector. Manager in Cash Technology Limited: A Chinese IPO in Singapore Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
High brand equity
– Ipo Machines has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Ipo Machines to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Analytics focus
– Ipo Machines 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 Larry Wynant, Nigel Goodwin 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.
Weaknesses Cash Technology Limited: A Chinese IPO in Singapore | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Cash Technology Limited: A Chinese IPO in Singapore are -
Slow decision making process
– As mentioned earlier in the report, Ipo Machines 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. Ipo Machines 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Ipo Machines 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.
Skills based hiring
– The stress on hiring functional specialists at Ipo Machines has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Need for greater diversity
– Ipo Machines 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.
Interest costs
– Compare to the competition, Ipo Machines 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Cash Technology Limited: A Chinese IPO in Singapore, in the dynamic environment Ipo Machines has struggled to respond to the nimble upstart competition. Ipo Machines has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Lack of clear differentiation of Ipo Machines products
– To increase the profitability and margins on the products, Ipo Machines needs to provide more differentiated products than what it is currently offering in the marketplace.
Products dominated business model
– Even though Ipo Machines has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Cash Technology Limited: A Chinese IPO in Singapore should strive to include more intangible value offerings along with its core products and services.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Cash Technology Limited: A Chinese IPO in Singapore 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 Ipo Machines has relatively successful track record of launching new products.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Cash Technology Limited: A Chinese IPO in Singapore, is just above the industry average. Ipo Machines 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 cash cycle compare to competitors
Ipo Machines 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 Cash Technology Limited: A Chinese IPO in Singapore | 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 Cash Technology Limited: A Chinese IPO in Singapore are -
Better consumer reach
– The expansion of the 5G network will help Ipo Machines to increase its market reach. Ipo Machines will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Ipo Machines in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Finance & Accounting segment, and it will provide faster access to the consumers.
Leveraging digital technologies
– Ipo Machines 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.
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. Ipo Machines can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Learning at scale
– Online learning technologies has now opened space for Ipo Machines 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Ipo Machines 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, Cash Technology Limited: A Chinese IPO in Singapore, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Building a culture of innovation
– managers at Ipo Machines 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 Finance & Accounting segment.
Buying journey improvements
– Ipo Machines can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Cash Technology Limited: A Chinese IPO in Singapore 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Ipo Machines 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 Ipo Machines to hire the very best people irrespective of their geographical location.
Creating value in data economy
– The success of analytics program of Ipo Machines has opened avenues for new revenue streams for the organization in the industry. This can help Ipo Machines to build a more holistic ecosystem as suggested in the Cash Technology Limited: A Chinese IPO in Singapore case study. Ipo Machines can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Manufacturing automation
– Ipo Machines can use the latest technology developments to improve its manufacturing and designing process in Finance & Accounting 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.
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 Ipo Machines 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Ipo Machines can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Cash Technology Limited: A Chinese IPO in Singapore External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Cash Technology Limited: A Chinese IPO in Singapore are -
Shortening product life cycle
– it is one of the major threat that Ipo Machines is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Ipo Machines 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. Ipo Machines 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.
Environmental challenges
– Ipo Machines 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. Ipo Machines can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Consumer confidence and its impact on Ipo Machines 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.
Stagnating economy with rate increase
– Ipo Machines 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.
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.
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. Ipo Machines needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
High dependence on third party suppliers
– Ipo Machines 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 Ipo Machines.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Cash Technology Limited: A Chinese IPO in Singapore, Ipo Machines may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Finance & Accounting .
Increasing wage structure of Ipo Machines
– 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 Ipo Machines.
Technology acceleration in Forth Industrial Revolution
– Ipo Machines has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Ipo Machines needs to keep up with the evolution of technology in the Finance & Accounting sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Weighted SWOT Analysis of Cash Technology Limited: A Chinese IPO in Singapore 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 Cash Technology Limited: A Chinese IPO in Singapore 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 Cash Technology Limited: A Chinese IPO in Singapore 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 Cash Technology Limited: A Chinese IPO in Singapore 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 Cash Technology Limited: A Chinese IPO in Singapore 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 Ipo Machines needs to make to build a sustainable competitive advantage.