Managing the Human Cloud SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Managing the Human Cloud
Online crowdsourcing platforms are growing at double-digit rates and are starting to attract the attention of large companies. Just as cloud computing offers unconstrained access to processing capacity and storage, what the authors call the "human cloud"promises to connect businesses to millions of workers on tap, ready to perform tasks and solve problems that range from the simple to the complex.This is an MIT Sloan Management Review article. Although the initial concept for the human cloud was to create an eBay-like marketplace for talent and labor, there were obstacles. The simple auction model seemed ill-suited for large, complex undertakings. The model was also often perceived as too risky by managers, who had a hard time developing "virtual"rapport with workers. Today, four new human cloud models have developed, each aiming to overcome these problems in a distinct way: 1. The Facilitator model connects suppliers and buyers directly through a bidding process but offers increased visibility into the supplier's identity and work processes. Elance and oDesk are examples of this model. 2. The Arbitrator model enables buyers to compare the inputs of multiple providers before choosing which to purchase. Arbitrator platforms such as CrowdSpring and InnoCentive follow this approach. 3. The Aggregator model breaks down a job, such as proofreading, translation, transcription or tagging, into tiny bits of work -microtasks -and finds workers willing to complete these tasks, sometimes in the context of a game. Platforms like Amazon Mechanical Turk and CrowdFlower offer such capabilities. 4. The most sophisticated model, the Governor, provides project management, supplier certification and quality control to assure qualified coordination and management of complex projects. The authors note that harnessing the human cloud's power will -as with earlier outsourcing waves -require hard work and learning. Buyers may find it helpful to think about managing a human cloud initiative much the same way that they manage the main phases of any outsourcing engagement.
Swot Analysis of "Managing the Human Cloud" written by Evgeny Kaganer, Erran Carmel, Rudy Hirschheim, Timothy Olsen includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Cloud Human facing as an external strategic factors. Some of the topics covered in Managing the Human Cloud case study are - Strategic Management Strategies, International business and Global Business.
Some of the macro environment factors that can be used to understand the Managing the Human Cloud casestudy better are - – increasing transportation and logistics costs, increasing inequality as vast percentage of new income is going to the top 1%, wage bills are increasing, increasing commodity prices, supply chains are disrupted by pandemic , increasing government debt because of Covid-19 spendings, digital marketing is dominated by two big players Facebook and Google,
talent flight as more people leaving formal jobs, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Managing the Human Cloud
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Managing the Human Cloud case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Cloud Human, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Cloud Human 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 Managing the Human Cloud can be done for the following purposes –
1. Strategic planning using facts provided in Managing the Human Cloud case study
2. Improving business portfolio management of Cloud Human
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 Cloud Human
Strengths Managing the Human Cloud | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Cloud Human in Managing the Human Cloud Harvard Business Review case study are -
Strong track record of project management
– Cloud Human is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Successful track record of launching new products
– Cloud Human has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Cloud Human 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.
Superior customer experience
– The customer experience strategy of Cloud Human in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High brand equity
– Cloud Human has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Cloud Human to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– Cloud Human is one of the most innovative firm in sector. Manager in Managing the Human Cloud 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 Cloud Human in the sector have low bargaining power. Managing the Human Cloud has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Cloud Human to manage not only supply disruptions but also source products at highly competitive prices.
Organizational Resilience of Cloud Human
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Cloud Human does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Analytics focus
– Cloud Human 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 Evgeny Kaganer, Erran Carmel, Rudy Hirschheim, Timothy Olsen 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.
Sustainable margins compare to other players in Global Business industry
– Managing the Human Cloud firm has clearly differentiated products in the market place. This has enabled Cloud Human to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Cloud Human to invest into research and development (R&D) and innovation.
Learning organization
- Cloud Human 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 Cloud Human is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Managing the Human Cloud Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Cloud Human 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.
High switching costs
– The high switching costs that Cloud Human 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.
Weaknesses Managing the Human Cloud | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Managing the Human Cloud are -
Interest costs
– Compare to the competition, Cloud Human 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Managing the Human Cloud, is just above the industry average. Cloud Human needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Lack of clear differentiation of Cloud Human products
– To increase the profitability and margins on the products, Cloud Human needs to provide more differentiated products than what it is currently offering in the marketplace.
Products dominated business model
– Even though Cloud Human 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 - Managing the Human Cloud should strive to include more intangible value offerings along with its core products and services.
Capital Spending Reduction
– Even during the low interest decade, Cloud Human 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Cloud Human is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Managing the Human Cloud can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Low market penetration in new markets
– Outside its home market of Cloud Human, firm in the HBR case study Managing the Human Cloud 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 Cloud Human supply chain. Even after few cautionary changes mentioned in the HBR case study - Managing the Human Cloud, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Cloud Human vulnerable to further global disruptions in South East Asia.
Slow decision making process
– As mentioned earlier in the report, Cloud Human 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. Cloud Human 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Managing the Human Cloud HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Cloud Human has relatively successful track record of launching new products.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Managing the Human Cloud, it seems that the employees of Cloud Human 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.
Opportunities Managing the Human Cloud | 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 Managing the Human Cloud are -
Better consumer reach
– The expansion of the 5G network will help Cloud Human to increase its market reach. Cloud Human 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.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Cloud Human can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Cloud Human is facing challenges because of the dominance of functional experts in the organization. Managing the Human Cloud 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.
Developing new processes and practices
– Cloud Human can develop new processes and procedures in Global Business 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Cloud Human 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 Cloud Human to hire the very best people irrespective of their geographical location.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Global Business industry, but it has also influenced the consumer preferences. Cloud Human can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Cloud Human 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, Managing the Human Cloud, 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 Cloud Human 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Cloud Human can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Creating value in data economy
– The success of analytics program of Cloud Human has opened avenues for new revenue streams for the organization in the industry. This can help Cloud Human to build a more holistic ecosystem as suggested in the Managing the Human Cloud case study. Cloud Human can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Manufacturing automation
– Cloud Human 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Cloud Human can use these opportunities to build new business models that can help the communities that Cloud Human operates in. Secondly it can use opportunities from government spending in Global Business sector.
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. Cloud Human 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. Cloud Human 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.
Threats Managing the Human Cloud External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Managing the Human Cloud are -
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 Cloud Human business can come under increasing regulations regarding data privacy, data security, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Cloud Human with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Shortening product life cycle
– it is one of the major threat that Cloud Human is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Technology acceleration in Forth Industrial Revolution
– Cloud Human has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Cloud Human 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.
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 Cloud Human.
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. Cloud Human 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.
Increasing wage structure of Cloud Human
– 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 Cloud Human.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Managing the Human Cloud, Cloud Human 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 .
Environmental challenges
– Cloud Human 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. Cloud Human can take advantage of this fund but it will also bring new competitors in the Global Business industry.
Stagnating economy with rate increase
– Cloud Human 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Cloud Human 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 Managing the Human Cloud .
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. Cloud Human can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of Managing the Human Cloud 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 Managing the Human Cloud 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 Managing the Human Cloud 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 Managing the Human Cloud 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 Managing the Human Cloud 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 Cloud Human needs to make to build a sustainable competitive advantage.