Case Study Description of Financial Inclusion at Omidyar Network
A team of investors at Omidyar Network explore two different investment possibilities in the budding financial inclusion space, using their investment framework to consider capital alternatives available for both investments, each of which carries highly divergent financial and impact potential.
Authors :: Vikram Gandhi, Caitlin Lindsay Reimers Brumme, James Barnett
Swot Analysis of "Financial Inclusion at Omidyar Network" written by Vikram Gandhi, Caitlin Lindsay Reimers Brumme, James Barnett includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Omidyar Inclusion facing as an external strategic factors. Some of the topics covered in Financial Inclusion at Omidyar Network case study are - Strategic Management Strategies, Financial management, Strategy and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Financial Inclusion at Omidyar Network casestudy better are - – central banks are concerned over increasing inflation, cloud computing is disrupting traditional business models, increasing transportation and logistics costs, increasing commodity prices, increasing inequality as vast percentage of new income is going to the top 1%, increasing energy prices, customer relationship management is fast transforming because of increasing concerns over data privacy,
geopolitical disruptions, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Financial Inclusion at Omidyar Network
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Financial Inclusion at Omidyar Network case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Omidyar Inclusion, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Omidyar Inclusion 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 Financial Inclusion at Omidyar Network can be done for the following purposes –
1. Strategic planning using facts provided in Financial Inclusion at Omidyar Network case study
2. Improving business portfolio management of Omidyar Inclusion
3. Assessing feasibility of the new initiative in Finance & Accounting field.
4. Making a Finance & Accounting topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Omidyar Inclusion
Strengths Financial Inclusion at Omidyar Network | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Omidyar Inclusion in Financial Inclusion at Omidyar Network Harvard Business Review case study are -
Learning organization
- Omidyar Inclusion 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 Omidyar Inclusion is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Financial Inclusion at Omidyar Network Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Analytics focus
– Omidyar Inclusion 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 Vikram Gandhi, Caitlin Lindsay Reimers Brumme, James Barnett 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.
Highly skilled collaborators
– Omidyar Inclusion 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 Financial Inclusion at Omidyar Network HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– Omidyar Inclusion has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Omidyar Inclusion 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.
Innovation driven organization
– Omidyar Inclusion is one of the most innovative firm in sector. Manager in Financial Inclusion at Omidyar Network Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Omidyar Inclusion digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Omidyar Inclusion 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.
Organizational Resilience of Omidyar Inclusion
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Omidyar Inclusion does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Diverse revenue streams
– Omidyar Inclusion is present in almost all the verticals within the industry. This has provided firm in Financial Inclusion at Omidyar Network 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.
Ability to lead change in Finance & Accounting field
– Omidyar Inclusion 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 Omidyar Inclusion in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Sustainable margins compare to other players in Finance & Accounting industry
– Financial Inclusion at Omidyar Network firm has clearly differentiated products in the market place. This has enabled Omidyar Inclusion to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Omidyar Inclusion to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Omidyar Inclusion 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.
Low bargaining power of suppliers
– Suppliers of Omidyar Inclusion in the sector have low bargaining power. Financial Inclusion at Omidyar Network has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Omidyar Inclusion to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses Financial Inclusion at Omidyar Network | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Financial Inclusion at Omidyar Network are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Omidyar Inclusion is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Financial Inclusion at Omidyar Network can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Need for greater diversity
– Omidyar Inclusion 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.
Increasing silos among functional specialists
– The organizational structure of Omidyar Inclusion is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Omidyar Inclusion needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Omidyar Inclusion to focus more on services rather than just following the product oriented approach.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Financial Inclusion at Omidyar Network, it seems that the employees of Omidyar Inclusion 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Omidyar Inclusion 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.
No frontier risks strategy
– After analyzing the HBR case study Financial Inclusion at Omidyar Network, it seems that company is thinking about the frontier risks that can impact Finance & Accounting 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.
Low market penetration in new markets
– Outside its home market of Omidyar Inclusion, firm in the HBR case study Financial Inclusion at Omidyar Network needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High bargaining power of channel partners
– Because of the regulatory requirements, Vikram Gandhi, Caitlin Lindsay Reimers Brumme, James Barnett suggests that, Omidyar Inclusion 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.
Products dominated business model
– Even though Omidyar Inclusion 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 - Financial Inclusion at Omidyar Network should strive to include more intangible value offerings along with its core products and services.
Slow decision making process
– As mentioned earlier in the report, Omidyar Inclusion 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. Omidyar Inclusion 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 dependence on star products
– The top 2 products and services of the firm as mentioned in the Financial Inclusion at Omidyar Network 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 Omidyar Inclusion has relatively successful track record of launching new products.
Opportunities Financial Inclusion at Omidyar Network | 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 Financial Inclusion at Omidyar Network are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Omidyar Inclusion is facing challenges because of the dominance of functional experts in the organization. Financial Inclusion at Omidyar Network 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.
Loyalty marketing
– Omidyar Inclusion 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Omidyar Inclusion 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 Omidyar Inclusion to hire the very best people irrespective of their geographical location.
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 Omidyar Inclusion in the consumer business. Now Omidyar Inclusion can target international markets with far fewer capital restrictions requirements than the existing system.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Finance & Accounting industry, but it has also influenced the consumer preferences. Omidyar Inclusion can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Developing new processes and practices
– Omidyar Inclusion can develop new processes and procedures in Finance & Accounting 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.
Using analytics as competitive advantage
– Omidyar Inclusion 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 Financial Inclusion at Omidyar Network - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Omidyar Inclusion to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Omidyar Inclusion can use these opportunities to build new business models that can help the communities that Omidyar Inclusion operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Learning at scale
– Online learning technologies has now opened space for Omidyar Inclusion to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Finance & Accounting industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Omidyar Inclusion 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. Omidyar Inclusion 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Omidyar Inclusion can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Building a culture of innovation
– managers at Omidyar Inclusion 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 Finance & Accounting segment.
Buying journey improvements
– Omidyar Inclusion can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Financial Inclusion at Omidyar Network 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.
Threats Financial Inclusion at Omidyar Network External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Financial Inclusion at Omidyar Network are -
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.
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. Omidyar Inclusion 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.
Easy access to finance
– Easy access to finance in Finance & Accounting field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Omidyar Inclusion can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Omidyar Inclusion needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
Regulatory challenges
– Omidyar Inclusion 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 Finance & Accounting industry regulations.
High dependence on third party suppliers
– Omidyar Inclusion 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.
Shortening product life cycle
– it is one of the major threat that Omidyar Inclusion is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing wage structure of Omidyar Inclusion
– 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 Omidyar Inclusion.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Omidyar Inclusion in the Finance & Accounting industry. The Finance & Accounting 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 Omidyar Inclusion.
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 Omidyar Inclusion business can come under increasing regulations regarding data privacy, data security, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Omidyar Inclusion 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.
Weighted SWOT Analysis of Financial Inclusion at Omidyar Network 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 Financial Inclusion at Omidyar Network 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 Financial Inclusion at Omidyar Network 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 Financial Inclusion at Omidyar Network 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 Financial Inclusion at Omidyar Network 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 Omidyar Inclusion needs to make to build a sustainable competitive advantage.