BroadVision develops software that allows Internet-based businesses to gather information about their online customers and deliver customized information to them in return. The firm was founded in May 1993 by a successful entrepreneur with a track record of two previous successful startups. The case discusses the role of "rules-based systems" in delivering personalized information directly to the consumer and allowing one-to-one marketing to happen on the Internet. Trust and privacy issues related to the use of this "mass-customization" technology are discussed. Related personalization technologies, such as "collaborative filtering" are analyzed as well. Finally, the case deals with the growth strategy and business model of BroadVision, as a young Internet software company competing with software giants such as Microsoft, Netscape, and Oracle.
Swot Analysis of "BroadVision" written by Erik Brynjolfsson, Jean-Claude Charlet includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Broadvision Software facing as an external strategic factors. Some of the topics covered in BroadVision case study are - Strategic Management Strategies, Entrepreneurship, Internet, IT, Marketing and Technology & Operations.
Some of the macro environment factors that can be used to understand the BroadVision casestudy better are - – cloud computing is disrupting traditional business models, competitive advantages are harder to sustain because of technology dispersion, geopolitical disruptions, central banks are concerned over increasing inflation, digital marketing is dominated by two big players Facebook and Google, wage bills are increasing, increasing government debt because of Covid-19 spendings,
increasing transportation and logistics costs, increasing energy prices, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in BroadVision case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Broadvision Software, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Broadvision Software 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 BroadVision can be done for the following purposes –
1. Strategic planning using facts provided in BroadVision case study
2. Improving business portfolio management of Broadvision Software
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 Broadvision Software
Strengths BroadVision | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Broadvision Software in BroadVision Harvard Business Review case study are -
Innovation driven organization
– Broadvision Software is one of the most innovative firm in sector. Manager in BroadVision Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Operational resilience
– The operational resilience strategy in the BroadVision 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.
Highly skilled collaborators
– Broadvision Software 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 BroadVision HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High switching costs
– The high switching costs that Broadvision Software 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.
Strong track record of project management
– Broadvision Software is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Organizational Resilience of Broadvision Software
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Broadvision Software does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– Broadvision Software has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in BroadVision 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.
High brand equity
– Broadvision Software has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Broadvision Software to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Effective Research and Development (R&D)
– Broadvision Software 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 BroadVision - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Low bargaining power of suppliers
– Suppliers of Broadvision Software in the sector have low bargaining power. BroadVision has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Broadvision Software to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Broadvision Software in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Analytics focus
– Broadvision Software 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 Erik Brynjolfsson, Jean-Claude Charlet can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Weaknesses BroadVision | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of BroadVision are -
Low market penetration in new markets
– Outside its home market of Broadvision Software, firm in the HBR case study BroadVision needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study BroadVision, is just above the industry average. Broadvision Software needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
High cash cycle compare to competitors
Broadvision Software 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.
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 Broadvision Software supply chain. Even after few cautionary changes mentioned in the HBR case study - BroadVision, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Broadvision Software vulnerable to further global disruptions in South East Asia.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study BroadVision, in the dynamic environment Broadvision Software has struggled to respond to the nimble upstart competition. Broadvision Software has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High bargaining power of channel partners
– Because of the regulatory requirements, Erik Brynjolfsson, Jean-Claude Charlet suggests that, Broadvision Software 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the BroadVision 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 Broadvision Software has relatively successful track record of launching new products.
Interest costs
– Compare to the competition, Broadvision Software 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.
High operating costs
– Compare to the competitors, firm in the HBR case study BroadVision has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Broadvision Software 's lucrative customers.
Aligning sales with marketing
– It come across in the case study BroadVision 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 BroadVision can leverage the sales team experience to cultivate customer relationships as Broadvision Software is planning to shift buying processes online.
Skills based hiring
– The stress on hiring functional specialists at Broadvision Software 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.
Opportunities BroadVision | 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 BroadVision are -
Creating value in data economy
– The success of analytics program of Broadvision Software has opened avenues for new revenue streams for the organization in the industry. This can help Broadvision Software to build a more holistic ecosystem as suggested in the BroadVision case study. Broadvision Software can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Broadvision Software 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, BroadVision, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Building a culture of innovation
– managers at Broadvision Software 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Broadvision Software can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Buying journey improvements
– Broadvision Software can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. BroadVision 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 Broadvision Software in the consumer business. Now Broadvision Software can target international markets with far fewer capital restrictions requirements than the existing system.
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. Broadvision Software 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 Broadvision Software 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Broadvision Software 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 Broadvision Software to hire the very best people irrespective of their geographical location.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Broadvision Software can use these opportunities to build new business models that can help the communities that Broadvision Software operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Learning at scale
– Online learning technologies has now opened space for Broadvision Software 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.
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. Broadvision Software 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. Broadvision Software 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.
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. Broadvision Software can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats BroadVision External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study BroadVision are -
Increasing wage structure of Broadvision Software
– 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 Broadvision Software.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Broadvision Software 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 BroadVision .
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 Broadvision Software business can come under increasing regulations regarding data privacy, data security, etc.
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 Broadvision Software.
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 Broadvision Software in the Technology & Operations sector and impact the bottomline of the organization.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study BroadVision, Broadvision Software 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 .
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. Broadvision Software needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
Environmental challenges
– Broadvision Software 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. Broadvision Software can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
High dependence on third party suppliers
– Broadvision Software 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. Broadvision Software can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
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. Broadvision Software 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.
Shortening product life cycle
– it is one of the major threat that Broadvision Software is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of BroadVision 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 BroadVision 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 BroadVision 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 BroadVision 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 BroadVision 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 Broadvision Software needs to make to build a sustainable competitive advantage.