Building Smart Neighborhoods at Bouygues SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Building Smart Neighborhoods at Bouygues
Can a consortium of 16 organizations, including multinational corporations, local government agencies, and startups, turn a run-down Paris suburb into a "smart" (ecologically viable, high-tech, livable) neighborhood? This case explores how Bouygues Immobilier led such a project involving Alstom, Bouygues Energies & Services, Bouygues Telecom, EDF (Electricity of France), ERDF (Electricity Distribution Grid of France), Microsoft, Schneider Electric, Steria, and Total in Issy-les-Moulineaux (France). The enormous scope and diversity of the project is presented as well as the teaming strategies and governance model that facilitated its success. IssyGridA? earned the "Golden Issy" and "Grand Paris," among other awards, for its innovation and performance.
Swot Analysis of "Building Smart Neighborhoods at Bouygues" written by Amy C. Edmondson, Bertrand Moingeon, Guo Bai, Jean-Francois Harvey includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Bouygues Issy facing as an external strategic factors. Some of the topics covered in Building Smart Neighborhoods at Bouygues case study are - Strategic Management Strategies, Corporate governance, Creativity, Government, Innovation, IT, Leading teams, Organizational culture and Technology & Operations.
Some of the macro environment factors that can be used to understand the Building Smart Neighborhoods at Bouygues casestudy better are - – challanges to central banks by blockchain based private currencies, increasing commodity prices, there is increasing trade war between United States & China, increasing energy prices, cloud computing is disrupting traditional business models, increasing transportation and logistics costs, banking and financial system is disrupted by Bitcoin and other crypto currencies,
talent flight as more people leaving formal jobs, technology disruption, etc
Introduction to SWOT Analysis of Building Smart Neighborhoods at Bouygues
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Building Smart Neighborhoods at Bouygues case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Bouygues Issy, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Bouygues Issy 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 Building Smart Neighborhoods at Bouygues can be done for the following purposes –
1. Strategic planning using facts provided in Building Smart Neighborhoods at Bouygues case study
2. Improving business portfolio management of Bouygues Issy
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 Bouygues Issy
Strengths Building Smart Neighborhoods at Bouygues | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Bouygues Issy in Building Smart Neighborhoods at Bouygues Harvard Business Review case study are -
Sustainable margins compare to other players in Technology & Operations industry
– Building Smart Neighborhoods at Bouygues firm has clearly differentiated products in the market place. This has enabled Bouygues Issy to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Bouygues Issy to invest into research and development (R&D) and innovation.
Training and development
– Bouygues Issy has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Building Smart Neighborhoods at Bouygues 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.
Successful track record of launching new products
– Bouygues Issy has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Bouygues Issy 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.
High brand equity
– Bouygues Issy has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Bouygues Issy to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– Bouygues Issy is one of the most innovative firm in sector. Manager in Building Smart Neighborhoods at Bouygues Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Superior customer experience
– The customer experience strategy of Bouygues Issy in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Organizational Resilience of Bouygues Issy
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Bouygues Issy does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Operational resilience
– The operational resilience strategy in the Building Smart Neighborhoods at Bouygues 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.
Low bargaining power of suppliers
– Suppliers of Bouygues Issy in the sector have low bargaining power. Building Smart Neighborhoods at Bouygues has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Bouygues Issy to manage not only supply disruptions but also source products at highly competitive prices.
Analytics focus
– Bouygues Issy 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 Amy C. Edmondson, Bertrand Moingeon, Guo Bai, Jean-Francois Harvey 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.
Strong track record of project management
– Bouygues Issy is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High switching costs
– The high switching costs that Bouygues Issy 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.
Weaknesses Building Smart Neighborhoods at Bouygues | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Building Smart Neighborhoods at Bouygues are -
Aligning sales with marketing
– It come across in the case study Building Smart Neighborhoods at Bouygues 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 Building Smart Neighborhoods at Bouygues can leverage the sales team experience to cultivate customer relationships as Bouygues Issy is planning to shift buying processes online.
High cash cycle compare to competitors
Bouygues Issy 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.
Products dominated business model
– Even though Bouygues Issy 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 - Building Smart Neighborhoods at Bouygues should strive to include more intangible value offerings along with its core products and services.
Capital Spending Reduction
– Even during the low interest decade, Bouygues Issy 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.
No frontier risks strategy
– After analyzing the HBR case study Building Smart Neighborhoods at Bouygues, 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, Bouygues Issy 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 Bouygues Issy products
– To increase the profitability and margins on the products, Bouygues Issy needs to provide more differentiated products than what it is currently offering in the marketplace.
Skills based hiring
– The stress on hiring functional specialists at Bouygues Issy 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Building Smart Neighborhoods at Bouygues 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 Bouygues Issy has relatively successful track record of launching new products.
Workers concerns about automation
– As automation is fast increasing in the segment, Bouygues Issy 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.
Low market penetration in new markets
– Outside its home market of Bouygues Issy, firm in the HBR case study Building Smart Neighborhoods at Bouygues needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Opportunities Building Smart Neighborhoods at Bouygues | 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 Building Smart Neighborhoods at Bouygues are -
Developing new processes and practices
– Bouygues Issy 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.
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 Bouygues Issy in the consumer business. Now Bouygues Issy can target international markets with far fewer capital restrictions requirements than the existing system.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Bouygues Issy 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.
Loyalty marketing
– Bouygues Issy 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.
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. Bouygues Issy can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Bouygues Issy 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 Bouygues Issy to hire the very best people irrespective of their geographical location.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Bouygues Issy 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, Building Smart Neighborhoods at Bouygues, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Using analytics as competitive advantage
– Bouygues Issy 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 Building Smart Neighborhoods at Bouygues - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Bouygues Issy to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Building a culture of innovation
– managers at Bouygues Issy 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Bouygues Issy is facing challenges because of the dominance of functional experts in the organization. Building Smart Neighborhoods at Bouygues 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Bouygues Issy can use these opportunities to build new business models that can help the communities that Bouygues Issy 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 Bouygues Issy 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.
Leveraging digital technologies
– Bouygues Issy 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.
Threats Building Smart Neighborhoods at Bouygues External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Building Smart Neighborhoods at Bouygues are -
Technology acceleration in Forth Industrial Revolution
– Bouygues Issy has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Bouygues Issy 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.
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 Bouygues Issy business can come under increasing regulations regarding data privacy, data security, etc.
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.
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 Bouygues Issy.
Consumer confidence and its impact on Bouygues Issy 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.
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. Bouygues Issy needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
Increasing wage structure of Bouygues Issy
– 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 Bouygues Issy.
Shortening product life cycle
– it is one of the major threat that Bouygues Issy is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Bouygues Issy 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 Bouygues Issy in the Technology & Operations sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Bouygues Issy 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.
Environmental challenges
– Bouygues Issy 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. Bouygues Issy can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
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. Bouygues Issy 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.
Weighted SWOT Analysis of Building Smart Neighborhoods at Bouygues 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 Building Smart Neighborhoods at Bouygues 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 Building Smart Neighborhoods at Bouygues 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 Building Smart Neighborhoods at Bouygues 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 Building Smart Neighborhoods at Bouygues 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 Bouygues Issy needs to make to build a sustainable competitive advantage.