On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement)
French advertising company JCDecaux and the city of Paris jointly developed VA?lib', a wildly popular bicycle sharing system. Despite VA?lib's public appeal, vandalism and theft led to ballooning operating costs-costs borne by JCDecaux alone. The two parties opted to renegotiate their contract, which would impact prices, revenue sharing, cost allocation, and the operation of the system as a whole. Could the parties agree on a common strategy that would meet their objectives, while still delivering a first class bicycle sharing service to the city of Paris?
Swot Analysis of "On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement)" written by Peter A. Coles, Elena Corsi includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Bicycle Sharing facing as an external strategic factors. Some of the topics covered in On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) case study are - Strategic Management Strategies, Growth strategy, International business, Joint ventures, Marketing, Negotiations, Policy and Strategy & Execution.
Some of the macro environment factors that can be used to understand the On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, geopolitical disruptions, challanges to central banks by blockchain based private currencies, talent flight as more people leaving formal jobs, increasing household debt because of falling income levels, wage bills are increasing, there is increasing trade war between United States & China,
increasing inequality as vast percentage of new income is going to the top 1%, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Bicycle Sharing, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Bicycle Sharing 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 On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) can be done for the following purposes –
1. Strategic planning using facts provided in On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) case study
2. Improving business portfolio management of Bicycle Sharing
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 Bicycle Sharing
Strengths On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Bicycle Sharing in On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) Harvard Business Review case study are -
Diverse revenue streams
– Bicycle Sharing is present in almost all the verticals within the industry. This has provided firm in On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) 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.
Effective Research and Development (R&D)
– Bicycle Sharing has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Successful track record of launching new products
– Bicycle Sharing has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Bicycle Sharing has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Ability to recruit top talent
– Bicycle Sharing is one of the leading recruiters in the industry. Managers in the On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Innovation driven organization
– Bicycle Sharing is one of the most innovative firm in sector. Manager in On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) 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
– Bicycle Sharing has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Bicycle Sharing to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Bicycle Sharing digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Bicycle Sharing 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.
Ability to lead change in Strategy & Execution field
– Bicycle Sharing 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 Bicycle Sharing in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Superior customer experience
– The customer experience strategy of Bicycle Sharing in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Analytics focus
– Bicycle Sharing 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 Peter A. Coles, Elena Corsi 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.
Sustainable margins compare to other players in Strategy & Execution industry
– On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) firm has clearly differentiated products in the market place. This has enabled Bicycle Sharing to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Bicycle Sharing to invest into research and development (R&D) and innovation.
Low bargaining power of suppliers
– Suppliers of Bicycle Sharing in the sector have low bargaining power. On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Bicycle Sharing to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) are -
Low market penetration in new markets
– Outside its home market of Bicycle Sharing, firm in the HBR case study On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Skills based hiring
– The stress on hiring functional specialists at Bicycle Sharing 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.
Interest costs
– Compare to the competition, Bicycle Sharing 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.
Need for greater diversity
– Bicycle Sharing 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement), in the dynamic environment Bicycle Sharing has struggled to respond to the nimble upstart competition. Bicycle Sharing has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement), is just above the industry average. Bicycle Sharing 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.
Products dominated business model
– Even though Bicycle Sharing 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 - On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) should strive to include more intangible value offerings along with its core products and services.
Workers concerns about automation
– As automation is fast increasing in the segment, Bicycle Sharing 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 On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) 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 On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) can leverage the sales team experience to cultivate customer relationships as Bicycle Sharing is planning to shift buying processes online.
Slow to strategic competitive environment developments
– As On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) HBR case study mentions - Bicycle Sharing 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
Bicycle Sharing 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 On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) | 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 On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) 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. Bicycle Sharing can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 Bicycle Sharing 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.
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. Bicycle Sharing can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Low interest rates
– Even though inflation is raising its head in most developed economies, Bicycle Sharing 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.
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 Bicycle Sharing in the consumer business. Now Bicycle Sharing can target international markets with far fewer capital restrictions requirements than the existing system.
Better consumer reach
– The expansion of the 5G network will help Bicycle Sharing to increase its market reach. Bicycle Sharing 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.
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. Bicycle Sharing 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. Bicycle Sharing 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.
Building a culture of innovation
– managers at Bicycle Sharing 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Bicycle Sharing 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 Bicycle Sharing to hire the very best people irrespective of their geographical location.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Bicycle Sharing is facing challenges because of the dominance of functional experts in the organization. On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) 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.
Developing new processes and practices
– Bicycle Sharing 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.
Leveraging digital technologies
– Bicycle Sharing 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
– Bicycle Sharing can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) 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.
Threats On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) are -
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.
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 Bicycle Sharing business can come under increasing regulations regarding data privacy, data security, 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.
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 Bicycle Sharing.
Technology acceleration in Forth Industrial Revolution
– Bicycle Sharing has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Bicycle Sharing 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.
Stagnating economy with rate increase
– Bicycle Sharing 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, Bicycle Sharing 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 On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Bicycle Sharing with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Shortening product life cycle
– it is one of the major threat that Bicycle Sharing is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Bicycle Sharing in the Strategy & Execution sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Bicycle Sharing 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.
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. Bicycle Sharing needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Consumer confidence and its impact on Bicycle Sharing 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.
Weighted SWOT Analysis of On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) 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 On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) 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 On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) 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 On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) 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 On Two Wheels in Paris: The Velib' Bicycle-Sharing Program (Supplement) 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 Bicycle Sharing needs to make to build a sustainable competitive advantage.