Prodigy Network: Democratizing Real Estate Design and Financing SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Prodigy Network: Democratizing Real Estate Design and Financing
This case follows Rodrigo Nino, founder and CEO of commercial real estate development company Prodigy Network, as he develops an equity-based crowdfunding model for small investors to access commercial real estate in Colombia, then tries out the model in the U.S. U.S. regulations, starting with the Securities Act of 1933, effectively barred sponsors from soliciting small investors for large commercial real estate. However, the JOBS Act of 2013 loosened U.S. restrictions on equity crowdfunding. Nino believes that crowdfunding will democratize real estate development by providing a new asset class for small investors, revolutionizing the industry. The case also follows Nino's development of an online platform to crowdsource design for his crowdfunded buildings, maximizing shared value throughout the development process. Nino faces many challenges as he attempts to crowdfund an extended stay hotel in Manhattan, New York. For example, crowdfunded real estate faces resistance from industry leaders, especially in regards to the concern of fraud, and SEC regulations on crowdfunding remain undetermined at the time of the case.
Authors :: Karim R. Lakhani, Katja Hutter, Greta Friar
Swot Analysis of "Prodigy Network: Democratizing Real Estate Design and Financing" written by Karim R. Lakhani, Katja Hutter, Greta Friar includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Crowdfunding Nino facing as an external strategic factors. Some of the topics covered in Prodigy Network: Democratizing Real Estate Design and Financing case study are - Strategic Management Strategies, Design, Disruptive innovation, Financial analysis, IT, Venture capital and Technology & Operations.
Some of the macro environment factors that can be used to understand the Prodigy Network: Democratizing Real Estate Design and Financing casestudy better are - – challanges to central banks by blockchain based private currencies, increasing transportation and logistics costs, increasing household debt because of falling income levels, supply chains are disrupted by pandemic , cloud computing is disrupting traditional business models, digital marketing is dominated by two big players Facebook and Google, customer relationship management is fast transforming because of increasing concerns over data privacy,
increasing commodity prices, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of Prodigy Network: Democratizing Real Estate Design and Financing
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Prodigy Network: Democratizing Real Estate Design and Financing case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Crowdfunding Nino, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Crowdfunding Nino 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 Prodigy Network: Democratizing Real Estate Design and Financing can be done for the following purposes –
1. Strategic planning using facts provided in Prodigy Network: Democratizing Real Estate Design and Financing case study
2. Improving business portfolio management of Crowdfunding Nino
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 Crowdfunding Nino
Strengths Prodigy Network: Democratizing Real Estate Design and Financing | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Crowdfunding Nino in Prodigy Network: Democratizing Real Estate Design and Financing Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of Crowdfunding Nino in the sector have low bargaining power. Prodigy Network: Democratizing Real Estate Design and Financing has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Crowdfunding Nino to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that Crowdfunding Nino 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.
Operational resilience
– The operational resilience strategy in the Prodigy Network: Democratizing Real Estate Design and Financing 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.
Diverse revenue streams
– Crowdfunding Nino is present in almost all the verticals within the industry. This has provided firm in Prodigy Network: Democratizing Real Estate Design and Financing 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.
Cross disciplinary teams
– Horizontal connected teams at the Crowdfunding Nino 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.
Learning organization
- Crowdfunding Nino 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 Crowdfunding Nino is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Prodigy Network: Democratizing Real Estate Design and Financing Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Training and development
– Crowdfunding Nino has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Prodigy Network: Democratizing Real Estate Design and Financing 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.
Organizational Resilience of Crowdfunding Nino
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Crowdfunding Nino does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Crowdfunding Nino is one of the leading recruiters in the industry. Managers in the Prodigy Network: Democratizing Real Estate Design and Financing are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Innovation driven organization
– Crowdfunding Nino is one of the most innovative firm in sector. Manager in Prodigy Network: Democratizing Real Estate Design and Financing Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Sustainable margins compare to other players in Technology & Operations industry
– Prodigy Network: Democratizing Real Estate Design and Financing firm has clearly differentiated products in the market place. This has enabled Crowdfunding Nino to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Crowdfunding Nino to invest into research and development (R&D) and innovation.
Analytics focus
– Crowdfunding Nino 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 Karim R. Lakhani, Katja Hutter, Greta Friar 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 Prodigy Network: Democratizing Real Estate Design and Financing | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Prodigy Network: Democratizing Real Estate Design and Financing are -
Need for greater diversity
– Crowdfunding Nino 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Prodigy Network: Democratizing Real Estate Design and Financing, it seems that the employees of Crowdfunding Nino 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.
Products dominated business model
– Even though Crowdfunding Nino 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 - Prodigy Network: Democratizing Real Estate Design and Financing should strive to include more intangible value offerings along with its core products and services.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Prodigy Network: Democratizing Real Estate Design and Financing, is just above the industry average. Crowdfunding Nino 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.
No frontier risks strategy
– After analyzing the HBR case study Prodigy Network: Democratizing Real Estate Design and Financing, 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.
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 Crowdfunding Nino supply chain. Even after few cautionary changes mentioned in the HBR case study - Prodigy Network: Democratizing Real Estate Design and Financing, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Crowdfunding Nino vulnerable to further global disruptions in South East Asia.
High operating costs
– Compare to the competitors, firm in the HBR case study Prodigy Network: Democratizing Real Estate Design and Financing 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 Crowdfunding Nino 's lucrative customers.
Low market penetration in new markets
– Outside its home market of Crowdfunding Nino, firm in the HBR case study Prodigy Network: Democratizing Real Estate Design and Financing needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Aligning sales with marketing
– It come across in the case study Prodigy Network: Democratizing Real Estate Design and Financing 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 Prodigy Network: Democratizing Real Estate Design and Financing can leverage the sales team experience to cultivate customer relationships as Crowdfunding Nino is planning to shift buying processes online.
Skills based hiring
– The stress on hiring functional specialists at Crowdfunding Nino 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.
Slow decision making process
– As mentioned earlier in the report, Crowdfunding Nino 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. Crowdfunding Nino 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.
Opportunities Prodigy Network: Democratizing Real Estate Design and Financing | 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 Prodigy Network: Democratizing Real Estate Design and Financing are -
Learning at scale
– Online learning technologies has now opened space for Crowdfunding Nino 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
– Crowdfunding Nino 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.
Buying journey improvements
– Crowdfunding Nino can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Prodigy Network: Democratizing Real Estate Design and Financing 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.
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 Crowdfunding Nino 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.
Better consumer reach
– The expansion of the 5G network will help Crowdfunding Nino to increase its market reach. Crowdfunding Nino 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
– Crowdfunding Nino 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.
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. Crowdfunding Nino can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Crowdfunding Nino can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Creating value in data economy
– The success of analytics program of Crowdfunding Nino has opened avenues for new revenue streams for the organization in the industry. This can help Crowdfunding Nino to build a more holistic ecosystem as suggested in the Prodigy Network: Democratizing Real Estate Design and Financing case study. Crowdfunding Nino can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Crowdfunding Nino 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
– Crowdfunding Nino 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.
Manufacturing automation
– Crowdfunding Nino 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Crowdfunding Nino can use these opportunities to build new business models that can help the communities that Crowdfunding Nino operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Threats Prodigy Network: Democratizing Real Estate Design and Financing External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Prodigy Network: Democratizing Real Estate Design and Financing are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Crowdfunding Nino 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.
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 Crowdfunding Nino.
Environmental challenges
– Crowdfunding Nino 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. Crowdfunding Nino can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
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. Crowdfunding Nino can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
Regulatory challenges
– Crowdfunding Nino 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.
Shortening product life cycle
– it is one of the major threat that Crowdfunding Nino is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Stagnating economy with rate increase
– Crowdfunding Nino 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Crowdfunding Nino with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
Consumer confidence and its impact on Crowdfunding Nino 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.
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 Crowdfunding Nino in the Technology & Operations sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– Crowdfunding Nino has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Crowdfunding Nino 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.
Weighted SWOT Analysis of Prodigy Network: Democratizing Real Estate Design and Financing 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 Prodigy Network: Democratizing Real Estate Design and Financing 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 Prodigy Network: Democratizing Real Estate Design and Financing 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 Prodigy Network: Democratizing Real Estate Design and Financing 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 Prodigy Network: Democratizing Real Estate Design and Financing 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 Crowdfunding Nino needs to make to build a sustainable competitive advantage.