Real Estate Franchising: The Case of Coldwell Banker Expansion into China SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Real Estate Franchising: The Case of Coldwell Banker Expansion into China
Discusses the Chinese real estate market, with special reference to Shanghai, and depicts an interview with Taiwan's largest real estate company, which bought the master international franchising rights of Coldwell Banker for China. China's real estate market only recently opened to foreign investment, and franchising in China is in its infancy. Provides a unique examination of international franchising into a new product market area in the country. In addition, highlights some practices that professional services firms could adopt in their international expansion and discusses post-WTO implications to real estate franchising in China.
Swot Analysis of "Real Estate Franchising: The Case of Coldwell Banker Expansion into China" written by Ilan Alon, Ke Bian includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Franchising Estate facing as an external strategic factors. Some of the topics covered in Real Estate Franchising: The Case of Coldwell Banker Expansion into China case study are - Strategic Management Strategies, Growth strategy and Global Business.
Some of the macro environment factors that can be used to understand the Real Estate Franchising: The Case of Coldwell Banker Expansion into China casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, supply chains are disrupted by pandemic , technology disruption, increasing transportation and logistics costs, there is backlash against globalization, digital marketing is dominated by two big players Facebook and Google, central banks are concerned over increasing inflation,
increasing energy prices, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of Real Estate Franchising: The Case of Coldwell Banker Expansion into China
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Real Estate Franchising: The Case of Coldwell Banker Expansion into China case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Franchising Estate, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Franchising Estate 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 Real Estate Franchising: The Case of Coldwell Banker Expansion into China can be done for the following purposes –
1. Strategic planning using facts provided in Real Estate Franchising: The Case of Coldwell Banker Expansion into China case study
2. Improving business portfolio management of Franchising Estate
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 Franchising Estate
Strengths Real Estate Franchising: The Case of Coldwell Banker Expansion into China | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Franchising Estate in Real Estate Franchising: The Case of Coldwell Banker Expansion into China Harvard Business Review case study are -
Cross disciplinary teams
– Horizontal connected teams at the Franchising Estate 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.
Analytics focus
– Franchising Estate 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 Ilan Alon, Ke Bian 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.
Superior customer experience
– The customer experience strategy of Franchising Estate in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High switching costs
– The high switching costs that Franchising Estate 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.
Innovation driven organization
– Franchising Estate is one of the most innovative firm in sector. Manager in Real Estate Franchising: The Case of Coldwell Banker Expansion into China Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Strong track record of project management
– Franchising Estate is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to lead change in Global Business field
– Franchising Estate 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 Franchising Estate in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High brand equity
– Franchising Estate has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Franchising Estate to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Operational resilience
– The operational resilience strategy in the Real Estate Franchising: The Case of Coldwell Banker Expansion into China 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.
Diverse revenue streams
– Franchising Estate is present in almost all the verticals within the industry. This has provided firm in Real Estate Franchising: The Case of Coldwell Banker Expansion into China 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.
Training and development
– Franchising Estate has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Real Estate Franchising: The Case of Coldwell Banker Expansion into China Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Franchising Estate digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Franchising Estate 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.
Weaknesses Real Estate Franchising: The Case of Coldwell Banker Expansion into China | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Real Estate Franchising: The Case of Coldwell Banker Expansion into China are -
Low market penetration in new markets
– Outside its home market of Franchising Estate, firm in the HBR case study Real Estate Franchising: The Case of Coldwell Banker Expansion into China needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Interest costs
– Compare to the competition, Franchising Estate 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.
Skills based hiring
– The stress on hiring functional specialists at Franchising Estate 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.
Need for greater diversity
– Franchising Estate 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Franchising Estate is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Real Estate Franchising: The Case of Coldwell Banker Expansion into China can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Products dominated business model
– Even though Franchising Estate 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 - Real Estate Franchising: The Case of Coldwell Banker Expansion into China should strive to include more intangible value offerings along with its core products and services.
Lack of clear differentiation of Franchising Estate products
– To increase the profitability and margins on the products, Franchising Estate needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to strategic competitive environment developments
– As Real Estate Franchising: The Case of Coldwell Banker Expansion into China HBR case study mentions - Franchising Estate takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Capital Spending Reduction
– Even during the low interest decade, Franchising Estate 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.
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 Franchising Estate supply chain. Even after few cautionary changes mentioned in the HBR case study - Real Estate Franchising: The Case of Coldwell Banker Expansion into China, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Franchising Estate vulnerable to further global disruptions in South East Asia.
High operating costs
– Compare to the competitors, firm in the HBR case study Real Estate Franchising: The Case of Coldwell Banker Expansion into China 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 Franchising Estate 's lucrative customers.
Opportunities Real Estate Franchising: The Case of Coldwell Banker Expansion into China | 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 Real Estate Franchising: The Case of Coldwell Banker Expansion into China are -
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Franchising Estate can use these opportunities to build new business models that can help the communities that Franchising Estate operates in. Secondly it can use opportunities from government spending in Global Business sector.
Using analytics as competitive advantage
– Franchising Estate 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 Real Estate Franchising: The Case of Coldwell Banker Expansion into China - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Franchising Estate to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Franchising Estate 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. Franchising Estate 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.
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 Franchising Estate 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Franchising Estate 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Franchising Estate can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Buying journey improvements
– Franchising Estate can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Real Estate Franchising: The Case of Coldwell Banker Expansion into China 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.
Better consumer reach
– The expansion of the 5G network will help Franchising Estate to increase its market reach. Franchising Estate 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.
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 Franchising Estate in the consumer business. Now Franchising Estate can target international markets with far fewer capital restrictions requirements than the existing system.
Creating value in data economy
– The success of analytics program of Franchising Estate has opened avenues for new revenue streams for the organization in the industry. This can help Franchising Estate to build a more holistic ecosystem as suggested in the Real Estate Franchising: The Case of Coldwell Banker Expansion into China case study. Franchising Estate can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Franchising Estate 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.
Learning at scale
– Online learning technologies has now opened space for Franchising Estate 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.
Leveraging digital technologies
– Franchising Estate 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.
Threats Real Estate Franchising: The Case of Coldwell Banker Expansion into China External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Real Estate Franchising: The Case of Coldwell Banker Expansion into China are -
Shortening product life cycle
– it is one of the major threat that Franchising Estate is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Franchising Estate can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing wage structure of Franchising Estate
– 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 Franchising Estate.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Franchising Estate 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.
Technology acceleration in Forth Industrial Revolution
– Franchising Estate has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Franchising Estate needs to keep up with the evolution of technology in the Global Business 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.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Franchising Estate with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
High dependence on third party suppliers
– Franchising Estate 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Franchising Estate 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.
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 Franchising Estate in the Global Business sector and impact the bottomline of the organization.
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. Franchising Estate needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.
Stagnating economy with rate increase
– Franchising Estate 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 Real Estate Franchising: The Case of Coldwell Banker Expansion into China 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 Real Estate Franchising: The Case of Coldwell Banker Expansion into China 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 Real Estate Franchising: The Case of Coldwell Banker Expansion into China 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 Real Estate Franchising: The Case of Coldwell Banker Expansion into China 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 Real Estate Franchising: The Case of Coldwell Banker Expansion into China 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 Franchising Estate needs to make to build a sustainable competitive advantage.
