Bixi Goes to New York SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Bixi Goes to New York
In May 2011, the Public Bike System Company, based in Montreal, Canada, was preparing to answer a request for proposal by New York City to create a financially self-sustaining public bike-sharing system. Three years earlier, the company, owned by the Montreal Transit Authority, had created Bixi, a service that made bikes available to members through docking stations, powered by solar energy, spread across the city. Although its financial structure was still unproven, it was a promising solution that aimed to revolutionize urban transportation. In partnership with other private bike-sharing organizations, the company had successfully expanded to Minneapolis-St. Paul and Washington D.C. but had experienced problems with its implementations in Melbourne, London and Boston. Furthermore, the system in Montreal could not provide evidence of profitability, forcing the city government to step in by guaranteeing loans and providing additional cash flow. It also did not have a clear business plan as to how, when and where its international expansion should take place. Now, news of its problems in Montreal had made headlines in New York, putting the future of its expansion ambitions in doubt.
Swot Analysis of "Bixi Goes to New York" written by Yves Plourde, Jean-Louis Schaan includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Montreal Bike facing as an external strategic factors. Some of the topics covered in Bixi Goes to New York case study are - Strategic Management Strategies, and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Bixi Goes to New York casestudy better are - – digital marketing is dominated by two big players Facebook and Google, competitive advantages are harder to sustain because of technology dispersion, wage bills are increasing, central banks are concerned over increasing inflation, talent flight as more people leaving formal jobs, increasing government debt because of Covid-19 spendings, cloud computing is disrupting traditional business models,
banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Bixi Goes to New York
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Bixi Goes to New York case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Montreal Bike, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Montreal Bike 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 Bixi Goes to New York can be done for the following purposes –
1. Strategic planning using facts provided in Bixi Goes to New York case study
2. Improving business portfolio management of Montreal Bike
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 Montreal Bike
Strengths Bixi Goes to New York | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Montreal Bike in Bixi Goes to New York Harvard Business Review case study are -
Learning organization
- Montreal Bike 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 Montreal Bike is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Bixi Goes to New York Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in Strategy & Execution industry
– Bixi Goes to New York firm has clearly differentiated products in the market place. This has enabled Montreal Bike to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Montreal Bike to invest into research and development (R&D) and innovation.
Ability to recruit top talent
– Montreal Bike is one of the leading recruiters in the industry. Managers in the Bixi Goes to New York 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 Montreal Bike
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Montreal Bike does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Innovation driven organization
– Montreal Bike is one of the most innovative firm in sector. Manager in Bixi Goes to New York 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
– Montreal Bike has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Montreal Bike to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Successful track record of launching new products
– Montreal Bike has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Montreal Bike 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.
Highly skilled collaborators
– Montreal Bike 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 Bixi Goes to New York HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Montreal Bike digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Montreal Bike 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
– Montreal Bike 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 Montreal Bike in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Operational resilience
– The operational resilience strategy in the Bixi Goes to New York 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.
Training and development
– Montreal Bike has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Bixi Goes to New York 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.
Weaknesses Bixi Goes to New York | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Bixi Goes to New York are -
Capital Spending Reduction
– Even during the low interest decade, Montreal Bike 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.
Lack of clear differentiation of Montreal Bike products
– To increase the profitability and margins on the products, Montreal Bike needs to provide more differentiated products than what it is currently offering in the marketplace.
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 Montreal Bike supply chain. Even after few cautionary changes mentioned in the HBR case study - Bixi Goes to New York, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Montreal Bike vulnerable to further global disruptions in South East Asia.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Bixi Goes to New York 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 Montreal Bike has relatively successful track record of launching new products.
Need for greater diversity
– Montreal Bike 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Bixi Goes to New York, it seems that the employees of Montreal Bike don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
High bargaining power of channel partners
– Because of the regulatory requirements, Yves Plourde, Jean-Louis Schaan suggests that, Montreal Bike 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Bixi Goes to New York, is just above the industry average. Montreal Bike 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Montreal Bike is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Bixi Goes to New York 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, Montreal Bike 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.
Aligning sales with marketing
– It come across in the case study Bixi Goes to New York 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 Bixi Goes to New York can leverage the sales team experience to cultivate customer relationships as Montreal Bike is planning to shift buying processes online.
Opportunities Bixi Goes to New York | 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 Bixi Goes to New York are -
Creating value in data economy
– The success of analytics program of Montreal Bike has opened avenues for new revenue streams for the organization in the industry. This can help Montreal Bike to build a more holistic ecosystem as suggested in the Bixi Goes to New York case study. Montreal Bike can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Better consumer reach
– The expansion of the 5G network will help Montreal Bike to increase its market reach. Montreal Bike 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Montreal Bike 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, Bixi Goes to New York, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Learning at scale
– Online learning technologies has now opened space for Montreal Bike 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.
Buying journey improvements
– Montreal Bike can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Bixi Goes to New York 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.
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. Montreal Bike can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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 Montreal Bike in the consumer business. Now Montreal Bike can target international markets with far fewer capital restrictions requirements than the existing system.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Montreal Bike 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.
Loyalty marketing
– Montreal Bike 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Montreal Bike 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 Montreal Bike to hire the very best people irrespective of their geographical location.
Leveraging digital technologies
– Montreal Bike 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. Montreal Bike can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Developing new processes and practices
– Montreal Bike 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.
Threats Bixi Goes to New York External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Bixi Goes to New York are -
Technology acceleration in Forth Industrial Revolution
– Montreal Bike has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Montreal Bike 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.
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 Montreal Bike.
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. Montreal Bike 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
– Montreal Bike 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.
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.
Regulatory challenges
– Montreal Bike needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Strategy & Execution industry regulations.
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 Montreal Bike in the Strategy & Execution sector and impact the bottomline of the organization.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Montreal Bike 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 Bixi Goes to New York .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Montreal Bike with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing wage structure of Montreal Bike
– 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 Montreal Bike.
Stagnating economy with rate increase
– Montreal Bike 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.
Environmental challenges
– Montreal Bike 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. Montreal Bike can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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 Montreal Bike business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of Bixi Goes to New York 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 Bixi Goes to New York 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 Bixi Goes to New York 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 Bixi Goes to New York 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 Bixi Goes to New York 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 Montreal Bike needs to make to build a sustainable competitive advantage.