Deposita - Whether to Dominate the Value Chain or Not SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Deposita - Whether to Dominate the Value Chain or Not
Post-Apartheid South Africa has been characterized by high levels of crime, but also by sustained increases in the income levels of the previously disadvantaged black community. Cash is the preferred method of payment for new entrants into an economy, but it is also an attractive target for criminals. Deposita has seized the business opportunity presented by this tension, and developed an automated banking machine, basically an "ATM in reverse." As soon as businesses feed their cash into the machine on their premises, information about the deposit is relayed via a cellphone network to the Deposita database. With the realization that Deposita offers a cash management system that not only eliminates the time, cost and inaccuracies of manual cash counting, but also gives businesses remote visibility into the movement of cash, interest in Deposita grew rapidly, both within South Africa and internationally. The case highlights the systemic nature of innovation, technology-enabled innovation at the base of the pyramid, hyper-mediation, and the tension between product and geographic expansion as the owners of Deposita redirect their strategic focus to the entire cash value chain in South Africa or to international markets or both.
Swot Analysis of "Deposita - Whether to Dominate the Value Chain or Not" written by Helena Barnard includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Deposita Cash facing as an external strategic factors. Some of the topics covered in Deposita - Whether to Dominate the Value Chain or Not case study are - Strategic Management Strategies, Innovation and Global Business.
Some of the macro environment factors that can be used to understand the Deposita - Whether to Dominate the Value Chain or Not casestudy better are - – digital marketing is dominated by two big players Facebook and Google, talent flight as more people leaving formal jobs, cloud computing is disrupting traditional business models, there is increasing trade war between United States & China, increasing household debt because of falling income levels, increasing commodity prices, customer relationship management is fast transforming because of increasing concerns over data privacy,
increasing energy prices, wage bills are increasing, etc
Introduction to SWOT Analysis of Deposita - Whether to Dominate the Value Chain or Not
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Deposita - Whether to Dominate the Value Chain or Not case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Deposita Cash, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Deposita Cash 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 Deposita - Whether to Dominate the Value Chain or Not can be done for the following purposes –
1. Strategic planning using facts provided in Deposita - Whether to Dominate the Value Chain or Not case study
2. Improving business portfolio management of Deposita Cash
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 Deposita Cash
Strengths Deposita - Whether to Dominate the Value Chain or Not | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Deposita Cash in Deposita - Whether to Dominate the Value Chain or Not Harvard Business Review case study are -
Learning organization
- Deposita Cash 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 Deposita Cash is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Deposita - Whether to Dominate the Value Chain or Not Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Low bargaining power of suppliers
– Suppliers of Deposita Cash in the sector have low bargaining power. Deposita - Whether to Dominate the Value Chain or Not has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Deposita Cash to manage not only supply disruptions but also source products at highly competitive prices.
Highly skilled collaborators
– Deposita Cash 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 Deposita - Whether to Dominate the Value Chain or Not HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Cross disciplinary teams
– Horizontal connected teams at the Deposita Cash 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.
Innovation driven organization
– Deposita Cash is one of the most innovative firm in sector. Manager in Deposita - Whether to Dominate the Value Chain or Not Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Analytics focus
– Deposita Cash 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 Helena Barnard 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 Global Business field
– Deposita Cash 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 Deposita Cash 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 Global Business industry
– Deposita - Whether to Dominate the Value Chain or Not firm has clearly differentiated products in the market place. This has enabled Deposita Cash to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Deposita Cash to invest into research and development (R&D) and innovation.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Deposita Cash digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Deposita Cash 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.
Effective Research and Development (R&D)
– Deposita Cash 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 Deposita - Whether to Dominate the Value Chain or Not - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High switching costs
– The high switching costs that Deposita Cash 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.
Operational resilience
– The operational resilience strategy in the Deposita - Whether to Dominate the Value Chain or Not Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Weaknesses Deposita - Whether to Dominate the Value Chain or Not | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Deposita - Whether to Dominate the Value Chain or Not are -
Increasing silos among functional specialists
– The organizational structure of Deposita Cash is dominated by functional specialists. It is not different from other players in the Global Business segment. Deposita Cash needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Deposita Cash 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, Deposita Cash is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Deposita - Whether to Dominate the Value Chain or Not can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Deposita - Whether to Dominate the Value Chain or Not, it seems that the employees of Deposita Cash 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.
Products dominated business model
– Even though Deposita Cash 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 - Deposita - Whether to Dominate the Value Chain or Not should strive to include more intangible value offerings along with its core products and services.
Lack of clear differentiation of Deposita Cash products
– To increase the profitability and margins on the products, Deposita Cash needs to provide more differentiated products than what it is currently offering in the marketplace.
Skills based hiring
– The stress on hiring functional specialists at Deposita Cash 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Helena Barnard suggests that, Deposita Cash 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.
Capital Spending Reduction
– Even during the low interest decade, Deposita Cash 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.
Interest costs
– Compare to the competition, Deposita Cash 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.
Slow decision making process
– As mentioned earlier in the report, Deposita Cash 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. Deposita Cash 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.
Low market penetration in new markets
– Outside its home market of Deposita Cash, firm in the HBR case study Deposita - Whether to Dominate the Value Chain or Not needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Opportunities Deposita - Whether to Dominate the Value Chain or Not | 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 Deposita - Whether to Dominate the Value Chain or Not are -
Leveraging digital technologies
– Deposita Cash 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Deposita Cash 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.
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 Deposita Cash 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.
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 Deposita Cash in the consumer business. Now Deposita Cash can target international markets with far fewer capital restrictions requirements than the existing system.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Deposita Cash can use these opportunities to build new business models that can help the communities that Deposita Cash operates in. Secondly it can use opportunities from government spending in Global Business sector.
Buying journey improvements
– Deposita Cash can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Deposita - Whether to Dominate the Value Chain or Not 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
– Deposita Cash can use the latest technology developments to improve its manufacturing and designing process in Global Business segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Building a culture of innovation
– managers at Deposita Cash 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Deposita Cash is facing challenges because of the dominance of functional experts in the organization. Deposita - Whether to Dominate the Value Chain or Not 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.
Learning at scale
– Online learning technologies has now opened space for Deposita Cash 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Deposita Cash 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 Deposita Cash to hire the very best people irrespective of their geographical location.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Global Business industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Deposita Cash 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. Deposita Cash 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.
Better consumer reach
– The expansion of the 5G network will help Deposita Cash to increase its market reach. Deposita Cash will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Threats Deposita - Whether to Dominate the Value Chain or Not External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Deposita - Whether to Dominate the Value Chain or Not are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Deposita Cash 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Deposita - Whether to Dominate the Value Chain or Not, Deposita Cash 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 .
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 Deposita Cash in the Global Business sector and impact the bottomline of the organization.
Increasing wage structure of Deposita Cash
– 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 Deposita Cash.
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 Deposita Cash.
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.
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 Deposita Cash business can come under increasing regulations regarding data privacy, data security, etc.
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.
High dependence on third party suppliers
– Deposita Cash 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.
Consumer confidence and its impact on Deposita Cash 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Deposita Cash with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Deposita Cash needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.
Environmental challenges
– Deposita Cash 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. Deposita Cash can take advantage of this fund but it will also bring new competitors in the Global Business industry.
Weighted SWOT Analysis of Deposita - Whether to Dominate the Value Chain or Not 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 Deposita - Whether to Dominate the Value Chain or Not 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 Deposita - Whether to Dominate the Value Chain or Not 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 Deposita - Whether to Dominate the Value Chain or Not 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 Deposita - Whether to Dominate the Value Chain or Not 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 Deposita Cash needs to make to build a sustainable competitive advantage.
