Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development
Homestrings is an online investment platform for overseas diasporas to link financially with their home countries. The founder believes crowd-funding can become a pillar for development, but U.S. regulatory hurdles and resources constraints are substantial. The company is considering targeting non-diaspora investors, introducing new products like insurance or banking, and related expansion strategies.
Swot Analysis of "Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development" written by William R. Kerr, Alexis Brownell includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Homestrings Diaspora facing as an external strategic factors. Some of the topics covered in Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development case study are - Strategic Management Strategies, Financial management, Growth strategy, Marketing, Venture capital and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development casestudy better are - – increasing energy prices, geopolitical disruptions, increasing government debt because of Covid-19 spendings, there is backlash against globalization, increasing commodity prices, talent flight as more people leaving formal jobs, digital marketing is dominated by two big players Facebook and Google,
technology disruption, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Homestrings Diaspora, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Homestrings Diaspora 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 Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development can be done for the following purposes –
1. Strategic planning using facts provided in Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development case study
2. Improving business portfolio management of Homestrings Diaspora
3. Assessing feasibility of the new initiative in Innovation & Entrepreneurship field.
4. Making a Innovation & Entrepreneurship topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Homestrings Diaspora
Strengths Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Homestrings Diaspora in Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development Harvard Business Review case study are -
Ability to lead change in Innovation & Entrepreneurship field
– Homestrings Diaspora 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 Homestrings Diaspora in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Operational resilience
– The operational resilience strategy in the Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development 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.
Highly skilled collaborators
– Homestrings Diaspora 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 Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High switching costs
– The high switching costs that Homestrings Diaspora 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.
Learning organization
- Homestrings Diaspora 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 Homestrings Diaspora is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– Homestrings Diaspora is one of the leading recruiters in the industry. Managers in the Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Strong track record of project management
– Homestrings Diaspora is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development firm has clearly differentiated products in the market place. This has enabled Homestrings Diaspora to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Homestrings Diaspora to invest into research and development (R&D) and innovation.
Successful track record of launching new products
– Homestrings Diaspora has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Homestrings Diaspora has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Effective Research and Development (R&D)
– Homestrings Diaspora 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 Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Low bargaining power of suppliers
– Suppliers of Homestrings Diaspora in the sector have low bargaining power. Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Homestrings Diaspora to manage not only supply disruptions but also source products at highly competitive prices.
Training and development
– Homestrings Diaspora has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development 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.
Weaknesses Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development are -
Low market penetration in new markets
– Outside its home market of Homestrings Diaspora, firm in the HBR case study Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Need for greater diversity
– Homestrings Diaspora 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development 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 Homestrings Diaspora has relatively successful track record of launching new products.
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 Homestrings Diaspora supply chain. Even after few cautionary changes mentioned in the HBR case study - Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Homestrings Diaspora vulnerable to further global disruptions in South East Asia.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Homestrings Diaspora is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Aligning sales with marketing
– It come across in the case study Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development can leverage the sales team experience to cultivate customer relationships as Homestrings Diaspora is planning to shift buying processes online.
Products dominated business model
– Even though Homestrings Diaspora 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 - Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development should strive to include more intangible value offerings along with its core products and services.
High operating costs
– Compare to the competitors, firm in the HBR case study Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development 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 Homestrings Diaspora 's lucrative customers.
High bargaining power of channel partners
– Because of the regulatory requirements, William R. Kerr, Alexis Brownell suggests that, Homestrings Diaspora 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development, is just above the industry average. Homestrings Diaspora 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.
Slow to strategic competitive environment developments
– As Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development HBR case study mentions - Homestrings Diaspora 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.
Opportunities Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development | 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 Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Homestrings Diaspora is facing challenges because of the dominance of functional experts in the organization. Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Homestrings Diaspora in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Innovation & Entrepreneurship segment, and it will provide faster access to the consumers.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Innovation & Entrepreneurship industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Homestrings Diaspora 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. Homestrings Diaspora 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.
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 Homestrings Diaspora in the consumer business. Now Homestrings Diaspora can target international markets with far fewer capital restrictions requirements than the existing system.
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 Homestrings Diaspora 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.
Loyalty marketing
– Homestrings Diaspora 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.
Developing new processes and practices
– Homestrings Diaspora can develop new processes and procedures in Innovation & Entrepreneurship 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.
Using analytics as competitive advantage
– Homestrings Diaspora 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 Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Homestrings Diaspora to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Homestrings Diaspora 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, Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Creating value in data economy
– The success of analytics program of Homestrings Diaspora has opened avenues for new revenue streams for the organization in the industry. This can help Homestrings Diaspora to build a more holistic ecosystem as suggested in the Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development case study. Homestrings Diaspora can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Leveraging digital technologies
– Homestrings Diaspora 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.
Better consumer reach
– The expansion of the 5G network will help Homestrings Diaspora to increase its market reach. Homestrings Diaspora 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. Homestrings Diaspora can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development are -
Easy access to finance
– Easy access to finance in Innovation & Entrepreneurship field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Homestrings Diaspora can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Regulatory challenges
– Homestrings Diaspora 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 Innovation & Entrepreneurship industry regulations.
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.
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. Homestrings Diaspora needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.
Technology acceleration in Forth Industrial Revolution
– Homestrings Diaspora has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Homestrings Diaspora needs to keep up with the evolution of technology in the Innovation & Entrepreneurship 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.
High dependence on third party suppliers
– Homestrings Diaspora 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Homestrings Diaspora with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Homestrings Diaspora in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Environmental challenges
– Homestrings Diaspora 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. Homestrings Diaspora can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
Shortening product life cycle
– it is one of the major threat that Homestrings Diaspora is facing in Innovation & Entrepreneurship 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 Homestrings Diaspora in the Innovation & Entrepreneurship industry. The Innovation & Entrepreneurship 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.
Stagnating economy with rate increase
– Homestrings Diaspora 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.
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 Homestrings Diaspora business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development 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 Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development 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 Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development 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 Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development 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 Homestrings, Inc.: Diaspora-Based Financing and the Crowd Funding of Development 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 Homestrings Diaspora needs to make to build a sustainable competitive advantage.
