Montague Corporation: Unfolding the Future in Cycling SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Montague Corporation: Unfolding the Future in Cycling
Montague has developed a major innovation that creates a new sub-category in the bicycle industry: a full-sized, high-quality bicycle that folds. In contrast to existing small-wheeled folding bicycles that are portable, but with inferior performance characteristics, the Montague folding bicycle has the look, feel, and performance of a standard bicycle. However, while the firm has experienced notable success since its founding, it has yet to achieve widespread adoption of its innovation. What should the firm do to increase penetration? How can Montague overcome the reputation of folding bicycles as inferior performers and convince consumers, dealers, and others of its bicycle's quality? How can the firm get consumers to even notice the innovation when the bicycle looks just like a regular bicycle? In other words, how can Montague balance the need to look like a regular bicycle in order to achieve legitimacy with the need to signal value by looking different? What market segment should Montague be targeting - customers looking specifically for a folding bicycle, or consumers interested in a full-sized bicycle but for whom the folding feature might add value? Finally, should Montague license its technology to one of the leading mainstream bicycle manufacturers in order to increase adoption, vs. continuing to go it alone in the product market?
Swot Analysis of "Montague Corporation: Unfolding the Future in Cycling" written by Mary Tripsas includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Bicycle Montague facing as an external strategic factors. Some of the topics covered in Montague Corporation: Unfolding the Future in Cycling case study are - Strategic Management Strategies, Innovation, Market research, Sales, Strategy and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Montague Corporation: Unfolding the Future in Cycling casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing commodity prices, technology disruption, cloud computing is disrupting traditional business models, challanges to central banks by blockchain based private currencies, geopolitical disruptions, increasing household debt because of falling income levels,
increasing energy prices, talent flight as more people leaving formal jobs, etc
Introduction to SWOT Analysis of Montague Corporation: Unfolding the Future in Cycling
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Montague Corporation: Unfolding the Future in Cycling case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Bicycle Montague, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Bicycle Montague 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 Montague Corporation: Unfolding the Future in Cycling can be done for the following purposes –
1. Strategic planning using facts provided in Montague Corporation: Unfolding the Future in Cycling case study
2. Improving business portfolio management of Bicycle Montague
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 Bicycle Montague
Strengths Montague Corporation: Unfolding the Future in Cycling | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Bicycle Montague in Montague Corporation: Unfolding the Future in Cycling Harvard Business Review case study are -
Effective Research and Development (R&D)
– Bicycle Montague 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 Montague Corporation: Unfolding the Future in Cycling - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Superior customer experience
– The customer experience strategy of Bicycle Montague in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High brand equity
– Bicycle Montague has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Bicycle Montague to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Learning organization
- Bicycle Montague 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 Bicycle Montague is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Montague Corporation: Unfolding the Future in Cycling Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Analytics focus
– Bicycle Montague 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 Mary Tripsas 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.
Strong track record of project management
– Bicycle Montague is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Innovation driven organization
– Bicycle Montague is one of the most innovative firm in sector. Manager in Montague Corporation: Unfolding the Future in Cycling Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– Montague Corporation: Unfolding the Future in Cycling firm has clearly differentiated products in the market place. This has enabled Bicycle Montague to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Bicycle Montague to invest into research and development (R&D) and innovation.
Ability to recruit top talent
– Bicycle Montague is one of the leading recruiters in the industry. Managers in the Montague Corporation: Unfolding the Future in Cycling 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 Bicycle Montague
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Bicycle Montague 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 Bicycle Montague 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.
Successful track record of launching new products
– Bicycle Montague has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Bicycle Montague 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.
Weaknesses Montague Corporation: Unfolding the Future in Cycling | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Montague Corporation: Unfolding the Future in Cycling are -
Need for greater diversity
– Bicycle Montague 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Montague Corporation: Unfolding the Future in Cycling, in the dynamic environment Bicycle Montague has struggled to respond to the nimble upstart competition. Bicycle Montague has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Bicycle Montague is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Montague Corporation: Unfolding the Future in Cycling can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Products dominated business model
– Even though Bicycle Montague 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 - Montague Corporation: Unfolding the Future in Cycling should strive to include more intangible value offerings along with its core products and services.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Montague Corporation: Unfolding the Future in Cycling, it seems that the employees of Bicycle Montague 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.
Interest costs
– Compare to the competition, Bicycle Montague 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.
Lack of clear differentiation of Bicycle Montague products
– To increase the profitability and margins on the products, Bicycle Montague needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow decision making process
– As mentioned earlier in the report, Bicycle Montague has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Bicycle Montague even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
High bargaining power of channel partners
– Because of the regulatory requirements, Mary Tripsas suggests that, Bicycle Montague 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.
Increasing silos among functional specialists
– The organizational structure of Bicycle Montague is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Bicycle Montague needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Bicycle Montague to focus more on services rather than just following the product oriented approach.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Montague Corporation: Unfolding the Future in Cycling 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 Bicycle Montague has relatively successful track record of launching new products.
Opportunities Montague Corporation: Unfolding the Future in Cycling | 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 Montague Corporation: Unfolding the Future in Cycling are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Bicycle Montague is facing challenges because of the dominance of functional experts in the organization. Montague Corporation: Unfolding the Future in Cycling 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.
Learning at scale
– Online learning technologies has now opened space for Bicycle Montague 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.
Using analytics as competitive advantage
– Bicycle Montague 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 Montague Corporation: Unfolding the Future in Cycling - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Bicycle Montague to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Bicycle Montague can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Building a culture of innovation
– managers at Bicycle Montague 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Bicycle Montague can use these opportunities to build new business models that can help the communities that Bicycle Montague operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
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. Bicycle Montague 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. Bicycle Montague 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.
Loyalty marketing
– Bicycle Montague 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Bicycle Montague can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Bicycle Montague in the consumer business. Now Bicycle Montague can target international markets with far fewer capital restrictions requirements than the existing system.
Better consumer reach
– The expansion of the 5G network will help Bicycle Montague to increase its market reach. Bicycle Montague 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.
Leveraging digital technologies
– Bicycle Montague 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.
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 Bicycle Montague 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 Montague Corporation: Unfolding the Future in Cycling External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Montague Corporation: Unfolding the Future in Cycling are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Montague Corporation: Unfolding the Future in Cycling, Bicycle Montague 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 .
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 Bicycle Montague.
Regulatory challenges
– Bicycle Montague 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.
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. Bicycle Montague can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Bicycle Montague in the Innovation & Entrepreneurship sector and impact the bottomline 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. Bicycle Montague needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.
High dependence on third party suppliers
– Bicycle Montague 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Bicycle Montague 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.
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 Bicycle Montague business can come under increasing regulations regarding data privacy, data security, etc.
Consumer confidence and its impact on Bicycle Montague 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.
Technology acceleration in Forth Industrial Revolution
– Bicycle Montague has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Bicycle Montague 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.
Stagnating economy with rate increase
– Bicycle Montague 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.
Environmental challenges
– Bicycle Montague 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. Bicycle Montague can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
Weighted SWOT Analysis of Montague Corporation: Unfolding the Future in Cycling 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 Montague Corporation: Unfolding the Future in Cycling 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 Montague Corporation: Unfolding the Future in Cycling 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 Montague Corporation: Unfolding the Future in Cycling 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 Montague Corporation: Unfolding the Future in Cycling 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 Bicycle Montague needs to make to build a sustainable competitive advantage.