Case Study Description of Debito Technologies: Taking a Debt Management App Abroad
Debito Technologies s.r.o. was started in December 2014 to help creditors better manage their issued debt. The company provided a complete beginning-to-end service using a debt management application (app) that traced debtors by following their digital footprint. The whole process was managed with just the mobile app and had no upfront fees. In 2017, with success in the Czech market, the company was considering expanding its operations abroad. The company needed to first select a country that provided excellent market potential and product fit, and then develop an ideal market entry. Ladislav Tyll and Mohit Srivastava are affiliated with University of Economics, Prague.
Swot Analysis of "Debito Technologies: Taking a Debt Management App Abroad" written by Ladislav Tyll, Mohit Srivastava includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Debito App facing as an external strategic factors. Some of the topics covered in Debito Technologies: Taking a Debt Management App Abroad case study are - Strategic Management Strategies, Growth strategy, International business, Marketing, Mobile and Global Business.
Some of the macro environment factors that can be used to understand the Debito Technologies: Taking a Debt Management App Abroad casestudy better are - – increasing energy prices, talent flight as more people leaving formal jobs, challanges to central banks by blockchain based private currencies, geopolitical disruptions, supply chains are disrupted by pandemic , increasing commodity prices, digital marketing is dominated by two big players Facebook and Google,
competitive advantages are harder to sustain because of technology dispersion, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of Debito Technologies: Taking a Debt Management App Abroad
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Debito Technologies: Taking a Debt Management App Abroad case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Debito App, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Debito App 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 Debito Technologies: Taking a Debt Management App Abroad can be done for the following purposes –
1. Strategic planning using facts provided in Debito Technologies: Taking a Debt Management App Abroad case study
2. Improving business portfolio management of Debito App
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 Debito App
Strengths Debito Technologies: Taking a Debt Management App Abroad | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Debito App in Debito Technologies: Taking a Debt Management App Abroad Harvard Business Review case study are -
Learning organization
- Debito App 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 Debito App is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Debito Technologies: Taking a Debt Management App Abroad Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Operational resilience
– The operational resilience strategy in the Debito Technologies: Taking a Debt Management App Abroad 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.
High switching costs
– The high switching costs that Debito App 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.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Debito App digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Debito App 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.
Cross disciplinary teams
– Horizontal connected teams at the Debito App 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 Debito App in the sector have low bargaining power. Debito Technologies: Taking a Debt Management App Abroad has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Debito App to manage not only supply disruptions but also source products at highly competitive prices.
Innovation driven organization
– Debito App is one of the most innovative firm in sector. Manager in Debito Technologies: Taking a Debt Management App Abroad 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 Debito App in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Strong track record of project management
– Debito App 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 brand equity
– Debito App has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Debito App to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Successful track record of launching new products
– Debito App has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Debito App 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.
Effective Research and Development (R&D)
– Debito App has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Debito Technologies: Taking a Debt Management App Abroad - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses Debito Technologies: Taking a Debt Management App Abroad | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Debito Technologies: Taking a Debt Management App Abroad are -
High operating costs
– Compare to the competitors, firm in the HBR case study Debito Technologies: Taking a Debt Management App Abroad 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 Debito App 's lucrative customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Debito App 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.
High cash cycle compare to competitors
Debito App 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.
Skills based hiring
– The stress on hiring functional specialists at Debito App 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Debito Technologies: Taking a Debt Management App Abroad, in the dynamic environment Debito App has struggled to respond to the nimble upstart competition. Debito App 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 Debito App products
– To increase the profitability and margins on the products, Debito App needs to provide more differentiated products than what it is currently offering in the marketplace.
Interest costs
– Compare to the competition, Debito App 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Debito Technologies: Taking a Debt Management App Abroad 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 Debito App has relatively successful track record of launching new products.
Slow decision making process
– As mentioned earlier in the report, Debito App 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. Debito App even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Capital Spending Reduction
– Even during the low interest decade, Debito App 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Debito Technologies: Taking a Debt Management App Abroad, is just above the industry average. Debito App 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.
Opportunities Debito Technologies: Taking a Debt Management App Abroad | 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 Debito Technologies: Taking a Debt Management App Abroad are -
Loyalty marketing
– Debito App 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.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Debito App can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Using analytics as competitive advantage
– Debito App 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 Debito Technologies: Taking a Debt Management App Abroad - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Debito App to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Debito App 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, Debito Technologies: Taking a Debt Management App Abroad, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Creating value in data economy
– The success of analytics program of Debito App has opened avenues for new revenue streams for the organization in the industry. This can help Debito App to build a more holistic ecosystem as suggested in the Debito Technologies: Taking a Debt Management App Abroad case study. Debito App can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Low interest rates
– Even though inflation is raising its head in most developed economies, Debito App can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Building a culture of innovation
– managers at Debito App 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 Global Business segment.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Debito App in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Global Business segment, and it will provide faster access to the consumers.
Leveraging digital technologies
– Debito App 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Debito App can use these opportunities to build new business models that can help the communities that Debito App operates in. Secondly it can use opportunities from government spending in Global Business sector.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Global Business industry, but it has also influenced the consumer preferences. Debito App can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Learning at scale
– Online learning technologies has now opened space for Debito App 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Debito App is facing challenges because of the dominance of functional experts in the organization. Debito Technologies: Taking a Debt Management App Abroad 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.
Threats Debito Technologies: Taking a Debt Management App Abroad External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Debito Technologies: Taking a Debt Management App Abroad are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Debito App with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Environmental challenges
– Debito App 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. Debito App can take advantage of this fund but it will also bring new competitors in the Global Business industry.
Shortening product life cycle
– it is one of the major threat that Debito App is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Debito App business can come under increasing regulations regarding data privacy, data security, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Debito App 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 Debito Technologies: Taking a Debt Management App Abroad .
Consumer confidence and its impact on Debito App 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Debito App 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.
Regulatory challenges
– Debito App 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 Global Business industry regulations.
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 Debito App in the Global Business sector and impact the bottomline 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. Debito App 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.
High dependence on third party suppliers
– Debito App 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Debito Technologies: Taking a Debt Management App Abroad, Debito App 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 .
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. Debito App can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of Debito Technologies: Taking a Debt Management App Abroad 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 Debito Technologies: Taking a Debt Management App Abroad 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 Debito Technologies: Taking a Debt Management App Abroad 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 Debito Technologies: Taking a Debt Management App Abroad 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 Debito Technologies: Taking a Debt Management App Abroad 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 Debito App needs to make to build a sustainable competitive advantage.