Challenges of Launching a Start-Up in China: Dorm99.com SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Challenges of Launching a Start-Up in China: Dorm99.com
After graduating from Harvard Business School in June 2006, Ken Pao and Bill Li were ready to fully commit to the Internet start-up they had been working on since they first stepped foot on the business school campus. They moved to Beijing, rounded out their management team, received venture capital investment, developed joint-venture partnerships, and set key milestones to create a full-impact product launch for their social networking Web site catering to the college market. On the day of their launch, they faced a setback from China's Ministry of Education and were forced back to square one. Discusses the pluses and minuses of partnering with China's government ministries, the highs and lows of entrepreneurship, and the numerous opportunities available to entrepreneurship in China today.
Authors :: William C. Kirby, F. Warren McFarlan, Tracy Yuen Manty
Swot Analysis of "Challenges of Launching a Start-Up in China: Dorm99.com" written by William C. Kirby, F. Warren McFarlan, Tracy Yuen Manty includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Dorm99 Minuses facing as an external strategic factors. Some of the topics covered in Challenges of Launching a Start-Up in China: Dorm99.com case study are - Strategic Management Strategies, Internet, Marketing, Networking, Venture capital and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Challenges of Launching a Start-Up in China: Dorm99.com casestudy better are - – increasing government debt because of Covid-19 spendings, competitive advantages are harder to sustain because of technology dispersion, central banks are concerned over increasing inflation, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing inequality as vast percentage of new income is going to the top 1%, increasing commodity prices, 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 Challenges of Launching a Start-Up in China: Dorm99.com
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Challenges of Launching a Start-Up in China: Dorm99.com case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Dorm99 Minuses, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Dorm99 Minuses 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 Challenges of Launching a Start-Up in China: Dorm99.com can be done for the following purposes –
1. Strategic planning using facts provided in Challenges of Launching a Start-Up in China: Dorm99.com case study
2. Improving business portfolio management of Dorm99 Minuses
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 Dorm99 Minuses
Strengths Challenges of Launching a Start-Up in China: Dorm99.com | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Dorm99 Minuses in Challenges of Launching a Start-Up in China: Dorm99.com Harvard Business Review case study are -
High brand equity
– Dorm99 Minuses has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Dorm99 Minuses to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– Challenges of Launching a Start-Up in China: Dorm99.com firm has clearly differentiated products in the market place. This has enabled Dorm99 Minuses to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Dorm99 Minuses to invest into research and development (R&D) and innovation.
Ability to recruit top talent
– Dorm99 Minuses is one of the leading recruiters in the industry. Managers in the Challenges of Launching a Start-Up in China: Dorm99.com are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Organizational Resilience of Dorm99 Minuses
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Dorm99 Minuses does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High switching costs
– The high switching costs that Dorm99 Minuses 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.
Training and development
– Dorm99 Minuses has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Challenges of Launching a Start-Up in China: Dorm99.com 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 lead change in Innovation & Entrepreneurship field
– Dorm99 Minuses 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 Dorm99 Minuses in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Diverse revenue streams
– Dorm99 Minuses is present in almost all the verticals within the industry. This has provided firm in Challenges of Launching a Start-Up in China: Dorm99.com 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.
Strong track record of project management
– Dorm99 Minuses is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Analytics focus
– Dorm99 Minuses 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 William C. Kirby, F. Warren McFarlan, Tracy Yuen Manty 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.
Operational resilience
– The operational resilience strategy in the Challenges of Launching a Start-Up in China: Dorm99.com 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.
Cross disciplinary teams
– Horizontal connected teams at the Dorm99 Minuses 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.
Weaknesses Challenges of Launching a Start-Up in China: Dorm99.com | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Challenges of Launching a Start-Up in China: Dorm99.com are -
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Challenges of Launching a Start-Up in China: Dorm99.com, it seems that the employees of Dorm99 Minuses 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.
Low market penetration in new markets
– Outside its home market of Dorm99 Minuses, firm in the HBR case study Challenges of Launching a Start-Up in China: Dorm99.com needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Workers concerns about automation
– As automation is fast increasing in the segment, Dorm99 Minuses 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 Challenges of Launching a Start-Up in China: Dorm99.com 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 Dorm99 Minuses 's lucrative customers.
High bargaining power of channel partners
– Because of the regulatory requirements, William C. Kirby, F. Warren McFarlan, Tracy Yuen Manty suggests that, Dorm99 Minuses 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.
Slow to strategic competitive environment developments
– As Challenges of Launching a Start-Up in China: Dorm99.com HBR case study mentions - Dorm99 Minuses 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.
High cash cycle compare to competitors
Dorm99 Minuses has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Capital Spending Reduction
– Even during the low interest decade, Dorm99 Minuses 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.
Skills based hiring
– The stress on hiring functional specialists at Dorm99 Minuses 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Challenges of Launching a Start-Up in China: Dorm99.com, is just above the industry average. Dorm99 Minuses 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.
No frontier risks strategy
– After analyzing the HBR case study Challenges of Launching a Start-Up in China: Dorm99.com, 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.
Opportunities Challenges of Launching a Start-Up in China: Dorm99.com | 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 Challenges of Launching a Start-Up in China: Dorm99.com are -
Buying journey improvements
– Dorm99 Minuses can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Challenges of Launching a Start-Up in China: Dorm99.com suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Better consumer reach
– The expansion of the 5G network will help Dorm99 Minuses to increase its market reach. Dorm99 Minuses will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Dorm99 Minuses in the consumer business. Now Dorm99 Minuses can target international markets with far fewer capital restrictions requirements than the existing system.
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. Dorm99 Minuses 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. Dorm99 Minuses 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Dorm99 Minuses can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Developing new processes and practices
– Dorm99 Minuses 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Dorm99 Minuses 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, Challenges of Launching a Start-Up in China: Dorm99.com, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Dorm99 Minuses can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Using analytics as competitive advantage
– Dorm99 Minuses 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 Challenges of Launching a Start-Up in China: Dorm99.com - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Dorm99 Minuses to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Dorm99 Minuses 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Dorm99 Minuses can use these opportunities to build new business models that can help the communities that Dorm99 Minuses operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Creating value in data economy
– The success of analytics program of Dorm99 Minuses has opened avenues for new revenue streams for the organization in the industry. This can help Dorm99 Minuses to build a more holistic ecosystem as suggested in the Challenges of Launching a Start-Up in China: Dorm99.com case study. Dorm99 Minuses can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Manufacturing automation
– Dorm99 Minuses 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.
Threats Challenges of Launching a Start-Up in China: Dorm99.com External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Challenges of Launching a Start-Up in China: Dorm99.com are -
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. Dorm99 Minuses 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.
High dependence on third party suppliers
– Dorm99 Minuses 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.
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. Dorm99 Minuses needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.
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 Dorm99 Minuses business can come under increasing regulations regarding data privacy, data security, etc.
Regulatory challenges
– Dorm99 Minuses 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Challenges of Launching a Start-Up in China: Dorm99.com, Dorm99 Minuses 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 .
Increasing wage structure of Dorm99 Minuses
– 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 Dorm99 Minuses.
Environmental challenges
– Dorm99 Minuses 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. Dorm99 Minuses can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
Consumer confidence and its impact on Dorm99 Minuses 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Dorm99 Minuses 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.
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.
Shortening product life cycle
– it is one of the major threat that Dorm99 Minuses is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Dorm99 Minuses in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Challenges of Launching a Start-Up in China: Dorm99.com 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 Challenges of Launching a Start-Up in China: Dorm99.com 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 Challenges of Launching a Start-Up in China: Dorm99.com 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 Challenges of Launching a Start-Up in China: Dorm99.com 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 Challenges of Launching a Start-Up in China: Dorm99.com 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 Dorm99 Minuses needs to make to build a sustainable competitive advantage.
