Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent
The protagonist is Bruce Dunlevie, a co-founder of venture firm Benchmark Capital. In early 2007, Dunlevie and his partners are faced with whether to expand their firm into China and/or India, as many other well respected VC firms had been doing at the same time. Despite having two existing and successful satellite offices in the UK and Israel, the partners are not convinced that further expansion makes sense. Therefore, to follow logic, they are also considering whether to spin out the existing satelittes to be independent entities or keep them as part of the Benchmark franchise.
Swot Analysis of "Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent" written by John Glynn, Joshua Spitzer includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Dunlevie Benchmark facing as an external strategic factors. Some of the topics covered in Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent case study are - Strategic Management Strategies, Financial markets, Global strategy, Organizational structure, Venture capital and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent casestudy better are - – there is increasing trade war between United States & China, competitive advantages are harder to sustain because of technology dispersion, wage bills are increasing, cloud computing is disrupting traditional business models, there is backlash against globalization, technology disruption, increasing government debt because of Covid-19 spendings,
challanges to central banks by blockchain based private currencies, increasing commodity prices, etc
Introduction to SWOT Analysis of Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Dunlevie Benchmark, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Dunlevie Benchmark 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 Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent can be done for the following purposes –
1. Strategic planning using facts provided in Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent case study
2. Improving business portfolio management of Dunlevie Benchmark
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 Dunlevie Benchmark
Strengths Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Dunlevie Benchmark in Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent Harvard Business Review case study are -
Strong track record of project management
– Dunlevie Benchmark is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Highly skilled collaborators
– Dunlevie Benchmark 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 Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Sustainable margins compare to other players in Finance & Accounting industry
– Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent firm has clearly differentiated products in the market place. This has enabled Dunlevie Benchmark to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Dunlevie Benchmark to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Dunlevie Benchmark 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.
Operational resilience
– The operational resilience strategy in the Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent 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.
Analytics focus
– Dunlevie Benchmark 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 John Glynn, Joshua Spitzer 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.
Organizational Resilience of Dunlevie Benchmark
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Dunlevie Benchmark does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High brand equity
– Dunlevie Benchmark has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Dunlevie Benchmark to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Dunlevie Benchmark is present in almost all the verticals within the industry. This has provided firm in Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent 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.
Successful track record of launching new products
– Dunlevie Benchmark has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Dunlevie Benchmark 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 Dunlevie Benchmark 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 Dunlevie Benchmark 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 Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent are -
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent, is just above the industry average. Dunlevie Benchmark 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Dunlevie Benchmark needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
High operating costs
– Compare to the competitors, firm in the HBR case study Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent 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 Dunlevie Benchmark 's lucrative customers.
Products dominated business model
– Even though Dunlevie Benchmark 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 - Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent should strive to include more intangible value offerings along with its core products and services.
Increasing silos among functional specialists
– The organizational structure of Dunlevie Benchmark is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Dunlevie Benchmark needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Dunlevie Benchmark to focus more on services rather than just following the product oriented approach.
Lack of clear differentiation of Dunlevie Benchmark products
– To increase the profitability and margins on the products, Dunlevie Benchmark needs to provide more differentiated products than what it is currently offering in the marketplace.
Interest costs
– Compare to the competition, Dunlevie Benchmark 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent, it seems that the employees of Dunlevie Benchmark 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.
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 Dunlevie Benchmark supply chain. Even after few cautionary changes mentioned in the HBR case study - Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Dunlevie Benchmark vulnerable to further global disruptions in South East Asia.
Skills based hiring
– The stress on hiring functional specialists at Dunlevie Benchmark 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.
No frontier risks strategy
– After analyzing the HBR case study Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent, 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 Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent | 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 Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent are -
Loyalty marketing
– Dunlevie Benchmark 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Dunlevie Benchmark 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, Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Dunlevie Benchmark 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. Dunlevie Benchmark 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.
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. Dunlevie Benchmark can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Manufacturing automation
– Dunlevie Benchmark 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Dunlevie Benchmark 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Dunlevie Benchmark can use these opportunities to build new business models that can help the communities that Dunlevie Benchmark operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
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. Dunlevie Benchmark can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Better consumer reach
– The expansion of the 5G network will help Dunlevie Benchmark to increase its market reach. Dunlevie Benchmark 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.
Buying journey improvements
– Dunlevie Benchmark can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Dunlevie Benchmark is facing challenges because of the dominance of functional experts in the organization. Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent 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
– Dunlevie Benchmark can develop new processes and procedures in Finance & Accounting industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
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 Dunlevie Benchmark 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.
Threats Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent are -
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
– Dunlevie Benchmark 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 Dunlevie Benchmark 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 Dunlevie Benchmark with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Stagnating economy with rate increase
– Dunlevie Benchmark 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.
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 Dunlevie Benchmark.
Shortening product life cycle
– it is one of the major threat that Dunlevie Benchmark is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Dunlevie Benchmark 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.
Regulatory challenges
– Dunlevie Benchmark 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.
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. Dunlevie Benchmark needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
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 Dunlevie Benchmark in the Finance & Accounting sector and impact the bottomline of the organization.
Increasing wage structure of Dunlevie Benchmark
– 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 Dunlevie Benchmark.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent, Dunlevie Benchmark 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 .
Weighted SWOT Analysis of Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent 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 Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent 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 Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent 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 Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent 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 Benchmark Capital Europe: Bringing Silicon Valley Venture Capital to the Continent 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 Dunlevie Benchmark needs to make to build a sustainable competitive advantage.
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