Indore City Bus Transport Service (B) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Indore City Bus Transport Service (B)
Supplement to case A00024. Towards the end of 90s, mounting losses forced Madhya Pradesh State Road Transport Corporation (MPSRTC), the sole provider of public transport in Madhya Pradesh, to suspend their urban services. As a consequence, organized public transport services ceased to exist in Indore, the largest metropolitan city of the state of Madhya Pradesh. This void was filled by Intermediate Public Transport (IPT) consisting of minibuses, tempos and auto rickshaws. As of January 2004, 300 private minibuses, 150 tempos, and 10,000 auto rickshaws were plying as IPT, but with poor service levels. Lack of public transport was a catalyst for rapid increase in personalized vehicles, and high level of pollution and accidents. Worried over the rapid growth of personalized vehicles, and high levels of pollution and accidents in Indore, policy makers and administrators had made several attempts of reviving the public transport system in the city. In 2005, the Collector and District Magistrate of Indore decided to make another attempt of reviving the public transport. The two cases, Indore City Bus Transport Service (A) and Indore City Bus Transport Service (B) discuss the complexity involved in the planning, rolling out, and running of public transport services in Indore on a sustainable basis. Case (A) details the prevalent socio-economic condition, travel characteristics, and positions taken by various stakeholders on provisioning of public transport service in Indore as of November 2005. Case (B) discusses the challenges during the growth and operation of the services as of June 2008. Unprecedented rise in crude oil prices along with (i) increase in maintenance cost of buses, price of new buses, and bank interest and (ii) decrease/marginal increase in the fare box revenue (more people were shifting to passes) and advertisement revenue depleted the margin of the operators. The fares had not been increased since the launch of services in February 2006. It was clear that Indore City Transport Service Limited (ICTSL), the SPV created to run the transport system, would survive only if operators were able to survive. The readers have to take the position of the board of ICTSL and consider various options available to them for running the services on a sustainable basis.
Authors :: G. Raghuram, Satyam Shivam Sundaram, Himanshu Patni
Swot Analysis of "Indore City Bus Transport Service (B)" written by G. Raghuram, Satyam Shivam Sundaram, Himanshu Patni includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Transport Indore facing as an external strategic factors. Some of the topics covered in Indore City Bus Transport Service (B) case study are - Strategic Management Strategies, and Technology & Operations.
Some of the macro environment factors that can be used to understand the Indore City Bus Transport Service (B) casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, increasing household debt because of falling income levels, increasing inequality as vast percentage of new income is going to the top 1%, banking and financial system is disrupted by Bitcoin and other crypto currencies, technology disruption, central banks are concerned over increasing inflation, wage bills are increasing,
talent flight as more people leaving formal jobs, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of Indore City Bus Transport Service (B)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Indore City Bus Transport Service (B) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Transport Indore, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Transport Indore 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 Indore City Bus Transport Service (B) can be done for the following purposes –
1. Strategic planning using facts provided in Indore City Bus Transport Service (B) case study
2. Improving business portfolio management of Transport Indore
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 Transport Indore
Strengths Indore City Bus Transport Service (B) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Transport Indore in Indore City Bus Transport Service (B) Harvard Business Review case study are -
Successful track record of launching new products
– Transport Indore has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Transport Indore 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.
Diverse revenue streams
– Transport Indore is present in almost all the verticals within the industry. This has provided firm in Indore City Bus Transport Service (B) case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Superior customer experience
– The customer experience strategy of Transport Indore in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Sustainable margins compare to other players in Technology & Operations industry
– Indore City Bus Transport Service (B) firm has clearly differentiated products in the market place. This has enabled Transport Indore to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Transport Indore to invest into research and development (R&D) and innovation.
Strong track record of project management
– Transport Indore is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Learning organization
- Transport Indore 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 Transport Indore is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Indore City Bus Transport Service (B) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to lead change in Technology & Operations field
– Transport Indore 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 Transport Indore in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Low bargaining power of suppliers
– Suppliers of Transport Indore in the sector have low bargaining power. Indore City Bus Transport Service (B) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Transport Indore to manage not only supply disruptions but also source products at highly competitive prices.
Effective Research and Development (R&D)
– Transport Indore 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 Indore City Bus Transport Service (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.
Ability to recruit top talent
– Transport Indore is one of the leading recruiters in the industry. Managers in the Indore City Bus Transport Service (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.
High brand equity
– Transport Indore has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Transport Indore to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Organizational Resilience of Transport Indore
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Transport Indore does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses Indore City Bus Transport Service (B) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Indore City Bus Transport Service (B) are -
No frontier risks strategy
– After analyzing the HBR case study Indore City Bus Transport Service (B), 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.
Products dominated business model
– Even though Transport Indore 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 - Indore City Bus Transport Service (B) should strive to include more intangible value offerings along with its core products and services.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Indore City Bus Transport Service (B), it seems that the employees of Transport Indore 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 operating costs
– Compare to the competitors, firm in the HBR case study Indore City Bus Transport Service (B) 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 Transport Indore 's lucrative customers.
Interest costs
– Compare to the competition, Transport Indore 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.
Lack of clear differentiation of Transport Indore products
– To increase the profitability and margins on the products, Transport Indore needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow decision making process
– As mentioned earlier in the report, Transport Indore 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. Transport Indore 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.
Capital Spending Reduction
– Even during the low interest decade, Transport Indore 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 bargaining power of channel partners
– Because of the regulatory requirements, G. Raghuram, Satyam Shivam Sundaram, Himanshu Patni suggests that, Transport Indore 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.
Aligning sales with marketing
– It come across in the case study Indore City Bus Transport Service (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 Indore City Bus Transport Service (B) can leverage the sales team experience to cultivate customer relationships as Transport Indore is planning to shift buying processes online.
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 Transport Indore supply chain. Even after few cautionary changes mentioned in the HBR case study - Indore City Bus Transport Service (B), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Transport Indore vulnerable to further global disruptions in South East Asia.
Opportunities Indore City Bus Transport Service (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 Indore City Bus Transport Service (B) are -
Better consumer reach
– The expansion of the 5G network will help Transport Indore to increase its market reach. Transport Indore 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Transport Indore is facing challenges because of the dominance of functional experts in the organization. Indore City Bus Transport Service (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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Transport Indore can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Leveraging digital technologies
– Transport Indore 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.
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. Transport Indore 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. Transport Indore 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Transport Indore can use these opportunities to build new business models that can help the communities that Transport Indore operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Using analytics as competitive advantage
– Transport Indore 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 Indore City Bus Transport Service (B) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Transport Indore to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Transport Indore in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Technology & Operations segment, and it will provide faster access to the consumers.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Transport Indore 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, Indore City Bus Transport Service (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.
Loyalty marketing
– Transport Indore 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.
Learning at scale
– Online learning technologies has now opened space for Transport Indore 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 Transport Indore 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.
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. Transport Indore can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats Indore City Bus Transport Service (B) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Indore City Bus Transport Service (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 Transport Indore.
Regulatory challenges
– Transport Indore 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 Technology & Operations industry regulations.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Transport Indore 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.
Shortening product life cycle
– it is one of the major threat that Transport Indore is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Transport Indore needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
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.
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. Transport Indore can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Transport Indore 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 Indore City Bus Transport Service (B), Transport Indore 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 .
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. Transport Indore 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Transport Indore 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 Indore City Bus Transport Service (B) .
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 Transport Indore business can come under increasing regulations regarding data privacy, data security, etc.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Weighted SWOT Analysis of Indore City Bus Transport Service (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 Indore City Bus Transport Service (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 Indore City Bus Transport Service (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 Indore City Bus Transport Service (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 Indore City Bus Transport Service (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 Transport Indore needs to make to build a sustainable competitive advantage.
