What3words: Positioning the Company for Growth SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of What3words: Positioning the Company for Growth
In mid-2015, the founders of what3words, a technology start-up in London, England, were eager to position their company for growth. After having financed their two-year entrepreneurial journey with the help of angel investors, they were preparing to meet with a strategic investor to finance the next level of growth. The strategic investor needed to know that the founders had a clear path to profitability and a strategy for continued growth in order to secure long-term business potential. How could the founders create an action plan to move the start-up from surviving to thriving?
Authors :: J. Robert Mitchell, Ramasastry Chandrasekhar
Swot Analysis of "What3words: Positioning the Company for Growth" written by J. Robert Mitchell, Ramasastry Chandrasekhar includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that What3words Founders facing as an external strategic factors. Some of the topics covered in What3words: Positioning the Company for Growth case study are - Strategic Management Strategies, and Global Business.
Some of the macro environment factors that can be used to understand the What3words: Positioning the Company for Growth casestudy better are - – talent flight as more people leaving formal jobs, banking and financial system is disrupted by Bitcoin and other crypto currencies, cloud computing is disrupting traditional business models, central banks are concerned over increasing inflation, increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies, technology disruption,
geopolitical disruptions, there is backlash against globalization, etc
Introduction to SWOT Analysis of What3words: Positioning the Company for Growth
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in What3words: Positioning the Company for Growth case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the What3words Founders, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which What3words Founders 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 What3words: Positioning the Company for Growth can be done for the following purposes –
1. Strategic planning using facts provided in What3words: Positioning the Company for Growth case study
2. Improving business portfolio management of What3words Founders
3. Assessing feasibility of the new initiative in Global Business field.
4. Making a Global Business topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of What3words Founders
Strengths What3words: Positioning the Company for Growth | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of What3words Founders in What3words: Positioning the Company for Growth Harvard Business Review case study are -
Learning organization
- What3words Founders 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 What3words Founders is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in What3words: Positioning the Company for Growth Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Strong track record of project management
– What3words Founders 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 What3words Founders 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.
Successful track record of launching new products
– What3words Founders has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. What3words Founders 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.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For What3words Founders digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. What3words Founders has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Sustainable margins compare to other players in Global Business industry
– What3words: Positioning the Company for Growth firm has clearly differentiated products in the market place. This has enabled What3words Founders to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped What3words Founders to invest into research and development (R&D) and innovation.
Organizational Resilience of What3words Founders
– The covid-19 pandemic has put organizational resilience at the centre of everthing that What3words Founders does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Highly skilled collaborators
– What3words Founders 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 What3words: Positioning the Company for Growth HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Diverse revenue streams
– What3words Founders is present in almost all the verticals within the industry. This has provided firm in What3words: Positioning the Company for Growth 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 What3words Founders 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.
High brand equity
– What3words Founders has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled What3words Founders to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Operational resilience
– The operational resilience strategy in the What3words: Positioning the Company for Growth 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.
Weaknesses What3words: Positioning the Company for Growth | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of What3words: Positioning the Company for Growth are -
Increasing silos among functional specialists
– The organizational structure of What3words Founders is dominated by functional specialists. It is not different from other players in the Global Business segment. What3words Founders needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help What3words Founders to focus more on services rather than just following the product oriented approach.
Slow decision making process
– As mentioned earlier in the report, What3words Founders 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. What3words Founders 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.
High operating costs
– Compare to the competitors, firm in the HBR case study What3words: Positioning the Company for Growth 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 What3words Founders 's lucrative customers.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study What3words: Positioning the Company for Growth, in the dynamic environment What3words Founders has struggled to respond to the nimble upstart competition. What3words Founders has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Lack of clear differentiation of What3words Founders products
– To increase the profitability and margins on the products, What3words Founders needs to provide more differentiated products than what it is currently offering in the marketplace.
Need for greater diversity
– What3words Founders 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 What3words: Positioning the Company for Growth, it seems that the employees of What3words Founders 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 cash cycle compare to competitors
What3words Founders 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.
Slow to strategic competitive environment developments
– As What3words: Positioning the Company for Growth HBR case study mentions - What3words Founders takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Low market penetration in new markets
– Outside its home market of What3words Founders, firm in the HBR case study What3words: Positioning the Company for Growth needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Products dominated business model
– Even though What3words Founders 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 - What3words: Positioning the Company for Growth should strive to include more intangible value offerings along with its core products and services.
Opportunities What3words: Positioning the Company for Growth | 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 What3words: Positioning the Company for Growth are -
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Global Business industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. What3words Founders 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. What3words Founders 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.
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 What3words Founders in the consumer business. Now What3words Founders can target international markets with far fewer capital restrictions requirements than the existing system.
Developing new processes and practices
– What3words Founders can develop new processes and procedures in Global Business 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.
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 What3words Founders 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.
Creating value in data economy
– The success of analytics program of What3words Founders has opened avenues for new revenue streams for the organization in the industry. This can help What3words Founders to build a more holistic ecosystem as suggested in the What3words: Positioning the Company for Growth case study. What3words Founders can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Redefining models of collaboration and team work
– As explained in the weaknesses section, What3words Founders is facing challenges because of the dominance of functional experts in the organization. What3words: Positioning the Company for Growth 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for What3words Founders 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 What3words Founders 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, What3words Founders 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, What3words: Positioning the Company for Growth, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Learning at scale
– Online learning technologies has now opened space for What3words Founders 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.
Using analytics as competitive advantage
– What3words Founders 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 What3words: Positioning the Company for Growth - to build a competitive advantage using analytics. The analytics driven competitive advantage can help What3words Founders to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Loyalty marketing
– What3words Founders 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects What3words Founders can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Manufacturing automation
– What3words Founders can use the latest technology developments to improve its manufacturing and designing process in Global Business 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.
Threats What3words: Positioning the Company for Growth External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study What3words: Positioning the Company for Growth are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study What3words: Positioning the Company for Growth, What3words Founders may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Global Business .
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.
Increasing wage structure of What3words Founders
– 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 What3words Founders.
Environmental challenges
– What3words Founders 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. What3words Founders can take advantage of this fund but it will also bring new competitors in the Global Business industry.
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. What3words Founders needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.
Easy access to finance
– Easy access to finance in Global Business field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. What3words Founders can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for What3words Founders in the Global Business industry. The Global Business 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents What3words Founders with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. What3words Founders 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.
Technology acceleration in Forth Industrial Revolution
– What3words Founders has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, What3words Founders needs to keep up with the evolution of technology in the Global Business sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, What3words Founders 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 What3words: Positioning the Company for Growth .
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.
Shortening product life cycle
– it is one of the major threat that What3words Founders is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of What3words: Positioning the Company for Growth 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 What3words: Positioning the Company for Growth 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 What3words: Positioning the Company for Growth 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 What3words: Positioning the Company for Growth 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 What3words: Positioning the Company for Growth 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 What3words Founders needs to make to build a sustainable competitive advantage.