Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services
Mr. Rao, with several years of banking experience, approached People's Group Dubai, a venture capitalist firm, seeking financing for a micro-remittance-cum-foreign exchange service operation in Hong Kong. He argued that demand for currency exchange services in Hong Kong would continue to grow because of the high number of tourists who visited Hong Kong on their China tour. He also argued that a captive market of domestic workers who remitted their wages to their home countries would provide continuous demand for remittance services. Mr. Rao was confident that he could start quickly with a small office staffed by a few tellers and one manager in a busy location of Hong Kong, and then expand operations to other locations. However, financing to cover fixed assets and working capital would be required to open additional outlets. A major enabler of the proposed strategy was the telecommunication network of Western Union, which had established a presence in several parts of the world as a trustworthy provider of remittance services. Mr. Rao also intended to benefit from the technology support and expertise of the IT arm of People's Group based in Bangalore, India. People's Group Dubai welcomed realistic entrepreneurial ideas if they were backed by clear strategies for business growth and promised an acceptable rate of return on investment (ROI). With competition and low-cost micro-remittance services provided by pure Internet players, there were questions about the adequacy of technology support from the Bangalore arm in steering Mr. Rao's proposed venture to success and generating adequate ROI in the short and long run. People's Group directors debated the viability of the proposed venture.
Authors :: Probir Kumar Banerjee, Moez Limayem, Louis Ma
Swot Analysis of "Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services" written by Probir Kumar Banerjee, Moez Limayem, Louis Ma includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Remittance People's facing as an external strategic factors. Some of the topics covered in Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services case study are - Strategic Management Strategies, Entrepreneurship, Technology and Technology & Operations.
Some of the macro environment factors that can be used to understand the Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services casestudy better are - – challanges to central banks by blockchain based private currencies, increasing government debt because of Covid-19 spendings, competitive advantages are harder to sustain because of technology dispersion, increasing energy prices, there is increasing trade war between United States & China, digital marketing is dominated by two big players Facebook and Google, cloud computing is disrupting traditional business models,
geopolitical disruptions, there is backlash against globalization, etc
Introduction to SWOT Analysis of Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Remittance People's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Remittance People'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 Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services can be done for the following purposes –
1. Strategic planning using facts provided in Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services case study
2. Improving business portfolio management of Remittance People's
3. Assessing feasibility of the new initiative in Technology & Operations field.
4. Making a Technology & Operations topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Remittance People's
Strengths Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Remittance People's in Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services Harvard Business Review case study are -
Strong track record of project management
– Remittance People'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.
Low bargaining power of suppliers
– Suppliers of Remittance People's in the sector have low bargaining power. Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Remittance People's to manage not only supply disruptions but also source products at highly competitive prices.
Ability to lead change in Technology & Operations field
– Remittance People'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 Remittance People's in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Successful track record of launching new products
– Remittance People's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Remittance People'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.
Analytics focus
– Remittance People'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 Probir Kumar Banerjee, Moez Limayem, Louis Ma 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.
Training and development
– Remittance People's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services 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.
Effective Research and Development (R&D)
– Remittance People's 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 Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Remittance People's digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Remittance People'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.
High brand equity
– Remittance People's has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Remittance People's to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Highly skilled collaborators
– Remittance People'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 Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services 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 Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services 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.
Cross disciplinary teams
– Horizontal connected teams at the Remittance People's are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Weaknesses Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services are -
Workers concerns about automation
– As automation is fast increasing in the segment, Remittance People'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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services, is just above the industry average. Remittance People's 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 Remittance People's 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 - Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services should strive to include more intangible value offerings along with its core products and services.
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 Remittance People's supply chain. Even after few cautionary changes mentioned in the HBR case study - Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Remittance People's vulnerable to further global disruptions in South East Asia.
Lack of clear differentiation of Remittance People's products
– To increase the profitability and margins on the products, Remittance People's needs to provide more differentiated products than what it is currently offering in the marketplace.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services, in the dynamic environment Remittance People's has struggled to respond to the nimble upstart competition. Remittance People's has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow decision making process
– As mentioned earlier in the report, Remittance People'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. Remittance People'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.
Increasing silos among functional specialists
– The organizational structure of Remittance People's is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Remittance People's needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Remittance People's to focus more on services rather than just following the product oriented approach.
No frontier risks strategy
– After analyzing the HBR case study Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services, it seems that company is thinking about the frontier risks that can impact Technology & Operations 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.
Interest costs
– Compare to the competition, Remittance People'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.
Slow to strategic competitive environment developments
– As Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services HBR case study mentions - Remittance People'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.
Opportunities Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services | 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 Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Remittance People's can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Manufacturing automation
– Remittance People's can use the latest technology developments to improve its manufacturing and designing process in Technology & Operations 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.
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. Remittance People's 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 Remittance People'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.
Building a culture of innovation
– managers at Remittance People'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 Technology & Operations segment.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Remittance People'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 Remittance People's to hire the very best people irrespective of their geographical location.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Remittance People's is facing challenges because of the dominance of functional experts in the organization. Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services 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
– Remittance People's can develop new processes and procedures in Technology & Operations 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.
Loyalty marketing
– Remittance People'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.
Better consumer reach
– The expansion of the 5G network will help Remittance People's to increase its market reach. Remittance People's 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.
Buying journey improvements
– Remittance People's can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services 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.
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 Remittance People's in the consumer business. Now Remittance People's can target international markets with far fewer capital restrictions requirements than the existing system.
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 Remittance People'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.
Threats Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Remittance People's 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 Remittance People's is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Remittance People'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.
Environmental challenges
– Remittance People'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. Remittance People's can take advantage of this fund but it will also bring new competitors in the Technology & Operations 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. Remittance People's needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
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 Remittance People's in the Technology & Operations sector and impact the bottomline of the organization.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Remittance People's business can come under increasing regulations regarding data privacy, data security, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Remittance People's in the Technology & Operations industry. The Technology & Operations 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.
High dependence on third party suppliers
– Remittance People'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.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Technology acceleration in Forth Industrial Revolution
– Remittance People's has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Remittance People's needs to keep up with the evolution of technology in the Technology & Operations 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
– Remittance People's 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, Remittance People'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 Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services .
Weighted SWOT Analysis of Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services 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 Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services 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 Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services 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 Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services 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 Entrepreneurship and IT Complementarity: The Case of People's Remittance and Exchange Services 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 Remittance People's needs to make to build a sustainable competitive advantage.
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