Case Study Description of 1366 Technologies: Scaling the Venture
To maximize their effectiveness, color cases should be printed in color.For some time, 1366's co-founders, Frank van Mierlo and Ely Sachs, had faced a choice, which was now made all the more stark: 1366 could expand to produce silicon wafers itself, raising the required capital from "friendly" investors and building shipment volume slowly, or 1366 could accelerate its market entry dramatically by partnering with the Asian manufacturers that had begun to dominate the world-wide solar industry. While accelerated growth was attractive to 1366 and its current investors, the company believed that it would face considerable risks if it were to expose its intellectual property to the "wrong" partners. 1366 had no intention of losing control of its technology, but given the pace of innovation and the active role of governments in the solar industry, van Mierlo and Sachs feared this might not be a race that could be won by the cautious.
Authors :: Joseph B. Lassiter, Ramana Nanda, David Kiron, Evan Richardson
Swot Analysis of "1366 Technologies: Scaling the Venture" written by Joseph B. Lassiter, Ramana Nanda, David Kiron, Evan Richardson includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that 1366 Mierlo facing as an external strategic factors. Some of the topics covered in 1366 Technologies: Scaling the Venture case study are - Strategic Management Strategies, Entrepreneurial finance, Entrepreneurial management, Financial management, Government, Innovation and Finance & Accounting.
Some of the macro environment factors that can be used to understand the 1366 Technologies: Scaling the Venture casestudy better are - – increasing government debt because of Covid-19 spendings, customer relationship management is fast transforming because of increasing concerns over data privacy, challanges to central banks by blockchain based private currencies, increasing commodity prices, central banks are concerned over increasing inflation, increasing transportation and logistics costs, banking and financial system is disrupted by Bitcoin and other crypto currencies,
technology disruption, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of 1366 Technologies: Scaling the Venture
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in 1366 Technologies: Scaling the Venture case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the 1366 Mierlo, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which 1366 Mierlo 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 1366 Technologies: Scaling the Venture can be done for the following purposes –
1. Strategic planning using facts provided in 1366 Technologies: Scaling the Venture case study
2. Improving business portfolio management of 1366 Mierlo
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 1366 Mierlo
Strengths 1366 Technologies: Scaling the Venture | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of 1366 Mierlo in 1366 Technologies: Scaling the Venture Harvard Business Review case study are -
Successful track record of launching new products
– 1366 Mierlo has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. 1366 Mierlo 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)
– 1366 Mierlo 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 1366 Technologies: Scaling the Venture - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Highly skilled collaborators
– 1366 Mierlo 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 1366 Technologies: Scaling the Venture HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Operational resilience
– The operational resilience strategy in the 1366 Technologies: Scaling the Venture 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.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For 1366 Mierlo digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. 1366 Mierlo 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.
Strong track record of project management
– 1366 Mierlo is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Innovation driven organization
– 1366 Mierlo is one of the most innovative firm in sector. Manager in 1366 Technologies: Scaling the Venture Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Low bargaining power of suppliers
– Suppliers of 1366 Mierlo in the sector have low bargaining power. 1366 Technologies: Scaling the Venture has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps 1366 Mierlo to manage not only supply disruptions but also source products at highly competitive prices.
Analytics focus
– 1366 Mierlo 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 Joseph B. Lassiter, Ramana Nanda, David Kiron, Evan Richardson 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 lead change in Finance & Accounting field
– 1366 Mierlo 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 1366 Mierlo in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Ability to recruit top talent
– 1366 Mierlo is one of the leading recruiters in the industry. Managers in the 1366 Technologies: Scaling the Venture are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
High brand equity
– 1366 Mierlo has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled 1366 Mierlo to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses 1366 Technologies: Scaling the Venture | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of 1366 Technologies: Scaling the Venture are -
Lack of clear differentiation of 1366 Mierlo products
– To increase the profitability and margins on the products, 1366 Mierlo needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, 1366 Mierlo is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study 1366 Technologies: Scaling the Venture can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study 1366 Technologies: Scaling the Venture, in the dynamic environment 1366 Mierlo has struggled to respond to the nimble upstart competition. 1366 Mierlo has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Products dominated business model
– Even though 1366 Mierlo 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 - 1366 Technologies: Scaling the Venture should strive to include more intangible value offerings along with its core products and services.
Increasing silos among functional specialists
– The organizational structure of 1366 Mierlo is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. 1366 Mierlo needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help 1366 Mierlo to focus more on services rather than just following the product oriented approach.
Interest costs
– Compare to the competition, 1366 Mierlo 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.
Capital Spending Reduction
– Even during the low interest decade, 1366 Mierlo 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.
Need for greater diversity
– 1366 Mierlo 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.
Aligning sales with marketing
– It come across in the case study 1366 Technologies: Scaling the Venture that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case 1366 Technologies: Scaling the Venture can leverage the sales team experience to cultivate customer relationships as 1366 Mierlo is planning to shift buying processes online.
Slow decision making process
– As mentioned earlier in the report, 1366 Mierlo 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. 1366 Mierlo 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.
No frontier risks strategy
– After analyzing the HBR case study 1366 Technologies: Scaling the Venture, 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.
Opportunities 1366 Technologies: Scaling the Venture | 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 1366 Technologies: Scaling the Venture are -
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. 1366 Mierlo 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. 1366 Mierlo 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.
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. 1366 Mierlo can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for 1366 Mierlo 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 1366 Mierlo to hire the very best people irrespective of their geographical location.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, 1366 Mierlo can use these opportunities to build new business models that can help the communities that 1366 Mierlo 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 1366 Mierlo 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, 1366 Mierlo is facing challenges because of the dominance of functional experts in the organization. 1366 Technologies: Scaling the Venture 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.
Leveraging digital technologies
– 1366 Mierlo 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.
Creating value in data economy
– The success of analytics program of 1366 Mierlo has opened avenues for new revenue streams for the organization in the industry. This can help 1366 Mierlo to build a more holistic ecosystem as suggested in the 1366 Technologies: Scaling the Venture case study. 1366 Mierlo can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– 1366 Mierlo can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. 1366 Technologies: Scaling the Venture 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.
Building a culture of innovation
– managers at 1366 Mierlo 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.
Manufacturing automation
– 1366 Mierlo 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.
Loyalty marketing
– 1366 Mierlo 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.
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 1366 Mierlo in the consumer business. Now 1366 Mierlo can target international markets with far fewer capital restrictions requirements than the existing system.
Threats 1366 Technologies: Scaling the Venture External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study 1366 Technologies: Scaling the Venture are -
Shortening product life cycle
– it is one of the major threat that 1366 Mierlo is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. 1366 Mierlo needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
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 1366 Mierlo business can come under increasing regulations regarding data privacy, data security, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study 1366 Technologies: Scaling the Venture, 1366 Mierlo 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 .
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, 1366 Mierlo 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 1366 Technologies: Scaling the Venture .
High dependence on third party suppliers
– 1366 Mierlo 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.
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. 1366 Mierlo can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Environmental challenges
– 1366 Mierlo 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. 1366 Mierlo can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents 1366 Mierlo with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Technology acceleration in Forth Industrial Revolution
– 1366 Mierlo has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, 1366 Mierlo 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.
Regulatory challenges
– 1366 Mierlo 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for 1366 Mierlo 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 1366 Mierlo.
Weighted SWOT Analysis of 1366 Technologies: Scaling the Venture 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 1366 Technologies: Scaling the Venture 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 1366 Technologies: Scaling the Venture 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 1366 Technologies: Scaling the Venture 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 1366 Technologies: Scaling the Venture 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 1366 Mierlo needs to make to build a sustainable competitive advantage.
