Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles"
It was long believed that entrepreneurship in Russia is close to impossible without government or mafia connections. This case study argues that, on the contrary, garage-type entrepreneurship is possible in Russia. For the Russians at Frontstep, the company in this case study, however, there were no how-to manuals to turn to. When the employees started making demands for Western-level salaries and benefits, matters came to a head. The problem was solved as the founders developed a hybrid organization, with Western incentives and structures, and Russian corporate culture.
Authors :: Manfred F.R. Kets de Vries, Konstantin Korotov, Elizabeth Florent-Treacy
Swot Analysis of "Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles"" written by Manfred F.R. Kets de Vries, Konstantin Korotov, Elizabeth Florent-Treacy includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Frontstep Russia facing as an external strategic factors. Some of the topics covered in Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" case study are - Strategic Management Strategies, Entrepreneurship, Human resource management, Leadership, Organizational structure and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" casestudy better are - – increasing government debt because of Covid-19 spendings, increasing household debt because of falling income levels, banking and financial system is disrupted by Bitcoin and other crypto currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing commodity prices, cloud computing is disrupting traditional business models, digital marketing is dominated by two big players Facebook and Google,
challanges to central banks by blockchain based private currencies, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles"
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Frontstep Russia, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Frontstep Russia 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 Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" can be done for the following purposes –
1. Strategic planning using facts provided in Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" case study
2. Improving business portfolio management of Frontstep Russia
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 Frontstep Russia
Strengths Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Frontstep Russia in Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" Harvard Business Review case study are -
High switching costs
– The high switching costs that Frontstep Russia 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.
Strong track record of project management
– Frontstep Russia 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
– Frontstep Russia has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Frontstep Russia 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.
Diverse revenue streams
– Frontstep Russia is present in almost all the verticals within the industry. This has provided firm in Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" 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.
Low bargaining power of suppliers
– Suppliers of Frontstep Russia in the sector have low bargaining power. Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Frontstep Russia to manage not only supply disruptions but also source products at highly competitive prices.
Ability to lead change in Innovation & Entrepreneurship field
– Frontstep Russia 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 Frontstep Russia in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Cross disciplinary teams
– Horizontal connected teams at the Frontstep Russia 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.
Training and development
– Frontstep Russia has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" 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.
Ability to recruit top talent
– Frontstep Russia is one of the leading recruiters in the industry. Managers in the Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Analytics focus
– Frontstep Russia 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 Manfred F.R. Kets de Vries, Konstantin Korotov, Elizabeth Florent-Treacy 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 Frontstep Russia
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Frontstep Russia does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Learning organization
- Frontstep Russia 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 Frontstep Russia is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" are -
No frontier risks strategy
– After analyzing the HBR case study Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles", it seems that company is thinking about the frontier risks that can impact Innovation & Entrepreneurship 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Manfred F.R. Kets de Vries, Konstantin Korotov, Elizabeth Florent-Treacy suggests that, Frontstep Russia 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles", in the dynamic environment Frontstep Russia has struggled to respond to the nimble upstart competition. Frontstep Russia has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Low market penetration in new markets
– Outside its home market of Frontstep Russia, firm in the HBR case study Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Lack of clear differentiation of Frontstep Russia products
– To increase the profitability and margins on the products, Frontstep Russia needs to provide more differentiated products than what it is currently offering in the marketplace.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" 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 Frontstep Russia has relatively successful track record of launching new products.
Need for greater diversity
– Frontstep Russia 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles", it seems that the employees of Frontstep Russia 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 Frontstep Russia supply chain. Even after few cautionary changes mentioned in the HBR case study - Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles", it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Frontstep Russia vulnerable to further global disruptions in South East Asia.
Capital Spending Reduction
– Even during the low interest decade, Frontstep Russia 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.
Increasing silos among functional specialists
– The organizational structure of Frontstep Russia is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Frontstep Russia needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Frontstep Russia to focus more on services rather than just following the product oriented approach.
Opportunities Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" | 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 Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" 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, Frontstep Russia can use these opportunities to build new business models that can help the communities that Frontstep Russia operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Manufacturing automation
– Frontstep Russia can use the latest technology developments to improve its manufacturing and designing process in Innovation & Entrepreneurship 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.
Creating value in data economy
– The success of analytics program of Frontstep Russia has opened avenues for new revenue streams for the organization in the industry. This can help Frontstep Russia to build a more holistic ecosystem as suggested in the Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" case study. Frontstep Russia can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– Frontstep Russia 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 Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Frontstep Russia to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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 Frontstep Russia 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, Frontstep Russia 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Frontstep Russia 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 Frontstep Russia to hire the very best people irrespective of their geographical location.
Building a culture of innovation
– managers at Frontstep Russia can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Innovation & Entrepreneurship segment.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Innovation & Entrepreneurship industry, but it has also influenced the consumer preferences. Frontstep Russia can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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 Frontstep Russia in the consumer business. Now Frontstep Russia can target international markets with far fewer capital restrictions requirements than the existing system.
Buying journey improvements
– Frontstep Russia can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" 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.
Learning at scale
– Online learning technologies has now opened space for Frontstep Russia 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.
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. Frontstep Russia 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. Frontstep Russia 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 Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" are -
Technology acceleration in Forth Industrial Revolution
– Frontstep Russia has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Frontstep Russia 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.
Increasing wage structure of Frontstep Russia
– 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 Frontstep Russia.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Frontstep Russia 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.
High dependence on third party suppliers
– Frontstep Russia 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 Frontstep Russia with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Frontstep Russia 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 Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" .
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles", Frontstep Russia may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Innovation & Entrepreneurship .
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 Frontstep Russia business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Frontstep Russia 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.
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. Frontstep Russia can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Consumer confidence and its impact on Frontstep Russia 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.
Shortening product life cycle
– it is one of the major threat that Frontstep Russia is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Frontstep Russia 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.
Weighted SWOT Analysis of Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" 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 Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" 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 Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" 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 Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" 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 Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles" 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 Frontstep Russia needs to make to build a sustainable competitive advantage.
Feel free to connect with us if you need business research.
You can download Excel Template of Case Study Solution & Analysis of Frontstep in Russia (A): High-Tech Start-up and Survival in a New "Time of Troubles"
