Swot Analysis of "Yodlee Inc.--The VerticalOne Integration (B)" written by John Melnyk, Darren Meister includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Verticalone Yodlee facing as an external strategic factors. Some of the topics covered in Yodlee Inc.--The VerticalOne Integration (B) case study are - Strategic Management Strategies, Mergers & acquisitions, Strategic planning, Strategy execution and Technology & Operations.
Some of the macro environment factors that can be used to understand the Yodlee Inc.--The VerticalOne Integration (B) casestudy better are - – technology disruption, there is backlash against globalization, increasing government debt because of Covid-19 spendings, challanges to central banks by blockchain based private currencies, increasing commodity prices, central banks are concerned over increasing inflation, cloud computing is disrupting traditional business models,
geopolitical disruptions, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Yodlee Inc.--The VerticalOne Integration (B)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Yodlee Inc.--The VerticalOne Integration (B) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Verticalone Yodlee, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Verticalone Yodlee 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 Yodlee Inc.--The VerticalOne Integration (B) can be done for the following purposes –
1. Strategic planning using facts provided in Yodlee Inc.--The VerticalOne Integration (B) case study
2. Improving business portfolio management of Verticalone Yodlee
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 Verticalone Yodlee
Strengths Yodlee Inc.--The VerticalOne Integration (B) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Verticalone Yodlee in Yodlee Inc.--The VerticalOne Integration (B) Harvard Business Review case study are -
High switching costs
– The high switching costs that Verticalone Yodlee has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Low bargaining power of suppliers
– Suppliers of Verticalone Yodlee in the sector have low bargaining power. Yodlee Inc.--The VerticalOne Integration (B) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Verticalone Yodlee to manage not only supply disruptions but also source products at highly competitive prices.
Training and development
– Verticalone Yodlee has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Yodlee Inc.--The VerticalOne Integration (B) 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
– Verticalone Yodlee 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 Yodlee Inc.--The VerticalOne Integration (B) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High brand equity
– Verticalone Yodlee has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Verticalone Yodlee to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Successful track record of launching new products
– Verticalone Yodlee has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Verticalone Yodlee 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.
Effective Research and Development (R&D)
– Verticalone Yodlee 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 Yodlee Inc.--The VerticalOne Integration (B) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Sustainable margins compare to other players in Technology & Operations industry
– Yodlee Inc.--The VerticalOne Integration (B) firm has clearly differentiated products in the market place. This has enabled Verticalone Yodlee to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Verticalone Yodlee to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Verticalone Yodlee 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.
Ability to recruit top talent
– Verticalone Yodlee is one of the leading recruiters in the industry. Managers in the Yodlee Inc.--The VerticalOne Integration (B) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Verticalone Yodlee digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Verticalone Yodlee 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.
Learning organization
- Verticalone Yodlee 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 Verticalone Yodlee is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Yodlee Inc.--The VerticalOne Integration (B) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses Yodlee Inc.--The VerticalOne Integration (B) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Yodlee Inc.--The VerticalOne Integration (B) are -
Need for greater diversity
– Verticalone Yodlee 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.
Aligning sales with marketing
– It come across in the case study Yodlee Inc.--The VerticalOne Integration (B) 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 Yodlee Inc.--The VerticalOne Integration (B) can leverage the sales team experience to cultivate customer relationships as Verticalone Yodlee is planning to shift buying processes online.
Products dominated business model
– Even though Verticalone Yodlee 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 - Yodlee Inc.--The VerticalOne Integration (B) should strive to include more intangible value offerings along with its core products and services.
Interest costs
– Compare to the competition, Verticalone Yodlee 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.
Capital Spending Reduction
– Even during the low interest decade, Verticalone Yodlee 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.
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 Verticalone Yodlee supply chain. Even after few cautionary changes mentioned in the HBR case study - Yodlee Inc.--The VerticalOne Integration (B), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Verticalone Yodlee vulnerable to further global disruptions in South East Asia.
Workers concerns about automation
– As automation is fast increasing in the segment, Verticalone Yodlee 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Yodlee Inc.--The VerticalOne Integration (B), it seems that the employees of Verticalone Yodlee 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.
Slow to strategic competitive environment developments
– As Yodlee Inc.--The VerticalOne Integration (B) HBR case study mentions - Verticalone Yodlee 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.
Slow decision making process
– As mentioned earlier in the report, Verticalone Yodlee 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. Verticalone Yodlee 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 Verticalone Yodlee is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Verticalone Yodlee needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Verticalone Yodlee to focus more on services rather than just following the product oriented approach.
Opportunities Yodlee Inc.--The VerticalOne Integration (B) | 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 Yodlee Inc.--The VerticalOne Integration (B) are -
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 Verticalone Yodlee 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.
Learning at scale
– Online learning technologies has now opened space for Verticalone Yodlee 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.
Loyalty marketing
– Verticalone Yodlee 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 Verticalone Yodlee to increase its market reach. Verticalone Yodlee 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.
Developing new processes and practices
– Verticalone Yodlee 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Technology & Operations industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Verticalone Yodlee 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. Verticalone Yodlee 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Verticalone Yodlee 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, Yodlee Inc.--The VerticalOne Integration (B), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Verticalone Yodlee can use these opportunities to build new business models that can help the communities that Verticalone Yodlee operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Technology & Operations industry, but it has also influenced the consumer preferences. Verticalone Yodlee can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Manufacturing automation
– Verticalone Yodlee 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Verticalone Yodlee is facing challenges because of the dominance of functional experts in the organization. Yodlee Inc.--The VerticalOne Integration (B) 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.
Using analytics as competitive advantage
– Verticalone Yodlee has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Yodlee Inc.--The VerticalOne Integration (B) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Verticalone Yodlee to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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 Verticalone Yodlee in the consumer business. Now Verticalone Yodlee can target international markets with far fewer capital restrictions requirements than the existing system.
Threats Yodlee Inc.--The VerticalOne Integration (B) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Yodlee Inc.--The VerticalOne Integration (B) are -
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 Verticalone Yodlee.
High dependence on third party suppliers
– Verticalone Yodlee 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.
Easy access to finance
– Easy access to finance in Technology & Operations field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Verticalone Yodlee can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Shortening product life cycle
– it is one of the major threat that Verticalone Yodlee is facing in Technology & Operations 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 Verticalone Yodlee in the Technology & Operations sector and impact the bottomline of the organization.
Stagnating economy with rate increase
– Verticalone Yodlee 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.
Consumer confidence and its impact on Verticalone Yodlee 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Verticalone Yodlee 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.
Environmental challenges
– Verticalone Yodlee 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. Verticalone Yodlee can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
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.
Technology acceleration in Forth Industrial Revolution
– Verticalone Yodlee has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Verticalone Yodlee 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.
Increasing wage structure of Verticalone Yodlee
– 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 Verticalone Yodlee.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Yodlee Inc.--The VerticalOne Integration (B), Verticalone Yodlee may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Technology & Operations .
Weighted SWOT Analysis of Yodlee Inc.--The VerticalOne Integration (B) 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 Yodlee Inc.--The VerticalOne Integration (B) 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 Yodlee Inc.--The VerticalOne Integration (B) 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 Yodlee Inc.--The VerticalOne Integration (B) 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 Yodlee Inc.--The VerticalOne Integration (B) 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 Verticalone Yodlee needs to make to build a sustainable competitive advantage.
