Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds
Compares and contrasts three different venture capital funds from the perspective of a potential investor. The first fund has a technology-enabled services preference, the second a Mid-Atlantic region preference, and the third a seed round preference. Students are asked to decide which fund (or combination of funds) would be the best investment and which fund would be the most attractive investor for entrepreneurs.
Swot Analysis of "Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds" written by William A. Sahlman, R. Matthew Willis includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Preference Funds facing as an external strategic factors. Some of the topics covered in Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds case study are - Strategic Management Strategies, Venture capital and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds casestudy better are - – supply chains are disrupted by pandemic , wage bills are increasing, there is backlash against globalization, challanges to central banks by blockchain based private currencies, increasing energy prices, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing transportation and logistics costs,
talent flight as more people leaving formal jobs, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Preference Funds, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Preference Funds 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 Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds can be done for the following purposes –
1. Strategic planning using facts provided in Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds case study
2. Improving business portfolio management of Preference Funds
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 Preference Funds
Strengths Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Preference Funds in Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds Harvard Business Review case study are -
Sustainable margins compare to other players in Finance & Accounting industry
– Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds firm has clearly differentiated products in the market place. This has enabled Preference Funds to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Preference Funds to invest into research and development (R&D) and innovation.
Innovation driven organization
– Preference Funds is one of the most innovative firm in sector. Manager in Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
High switching costs
– The high switching costs that Preference Funds 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.
Learning organization
- Preference Funds 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 Preference Funds is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Highly skilled collaborators
– Preference Funds 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 Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Strong track record of project management
– Preference Funds is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Cross disciplinary teams
– Horizontal connected teams at the Preference Funds 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.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Preference Funds digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Preference Funds 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.
Analytics focus
– Preference Funds 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 William A. Sahlman, R. Matthew Willis 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.
Ability to recruit top talent
– Preference Funds is one of the leading recruiters in the industry. Managers in the Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Effective Research and Development (R&D)
– Preference Funds 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 Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Diverse revenue streams
– Preference Funds is present in almost all the verticals within the industry. This has provided firm in Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds 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.
Weaknesses Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds are -
Skills based hiring
– The stress on hiring functional specialists at Preference Funds 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.
Products dominated business model
– Even though Preference Funds 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 - Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds 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, Preference Funds 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. Preference Funds 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.
Need for greater diversity
– Preference Funds 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.
No frontier risks strategy
– After analyzing the HBR case study Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds, 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.
Lack of clear differentiation of Preference Funds products
– To increase the profitability and margins on the products, Preference Funds needs to provide more differentiated products than what it is currently offering in the marketplace.
Increasing silos among functional specialists
– The organizational structure of Preference Funds is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Preference Funds needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Preference Funds to focus more on services rather than just following the product oriented approach.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Preference Funds is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Capital Spending Reduction
– Even during the low interest decade, Preference Funds 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.
Low market penetration in new markets
– Outside its home market of Preference Funds, firm in the HBR case study Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
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 Preference Funds supply chain. Even after few cautionary changes mentioned in the HBR case study - Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Preference Funds vulnerable to further global disruptions in South East Asia.
Opportunities Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds | 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 Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds are -
Using analytics as competitive advantage
– Preference Funds 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 Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Preference Funds to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Preference Funds is facing challenges because of the dominance of functional experts in the organization. Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Preference Funds 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, Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds, 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 Preference Funds 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.
Loyalty marketing
– Preference Funds 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.
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 Preference Funds 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.
Buying journey improvements
– Preference Funds can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds 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.
Manufacturing automation
– Preference Funds can use the latest technology developments to improve its manufacturing and designing process in Finance & Accounting 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.
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 Preference Funds in the consumer business. Now Preference Funds can target international markets with far fewer capital restrictions requirements than the existing system.
Low interest rates
– Even though inflation is raising its head in most developed economies, Preference Funds 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.
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. Preference Funds 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 Preference Funds can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Developing new processes and practices
– Preference Funds 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.
Threats Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds are -
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 Preference Funds in the Finance & Accounting sector and impact the bottomline of the organization.
Shortening product life cycle
– it is one of the major threat that Preference Funds is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Technology acceleration in Forth Industrial Revolution
– Preference Funds has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Preference Funds needs to keep up with the evolution of technology in the Finance & Accounting 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Preference Funds with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Regulatory challenges
– Preference Funds 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.
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. Preference Funds 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.
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 Preference Funds business can come under increasing regulations regarding data privacy, data security, etc.
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. Preference Funds can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds, Preference Funds may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Finance & Accounting .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Preference Funds 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 Preference Funds.
Increasing wage structure of Preference Funds
– 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 Preference Funds.
Stagnating economy with rate increase
– Preference Funds 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.
Weighted SWOT Analysis of Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds 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 Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds 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 Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds 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 Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds 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 Emergence, Valhalla, and Orchid: Divergent Models for Venture Capital Funds 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 Preference Funds needs to make to build a sustainable competitive advantage.