Is government the biggest, worst customer in the world? And is that a reason for venture investors to back companies that sell to government or to stay away? It had been seven years since Scott Burns joined his friend Zach Stabenow to get a company called GovDocs off the ground. In that time, they had evolved from a provider of government-mandated labor law posters to the country's largest sender of government-to-citizen emails. GovDelivery, as the company became known, was one of the first companies to move governments into the cloud, one of the first to sell them software as a service (SaaS), and in 2007, the only one with 3 million registered citizens using its platform to receive communications from federal, state, regional, and city governments and public authorities. In those seven years, Burns had raised capital from many sources: friends and family, angel investors, strategic partners, banks, and the investment arm of a major family fund. He and Stabenow had also grown the business through operating revenue and by keeping a tight watch on costs. They had to. Because growth capital had come in from almost all corners, expect one: major venture firms. Now, with roughly $6 million in annual revenue and projections to double that within three years, Burns was prepping for discussions with half a dozen Tier 1 firms. In doing so, he was anticipating what he thought would be the "elephant in the room." GovDelivery's business-to-government revenue model had been a conversation-stopper with major investors looking at Burns' company and companies like it. What would he tell potential backers?
Swot Analysis of "GovDelivery" written by Mitchell Weiss includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Burns Govdelivery facing as an external strategic factors. Some of the topics covered in GovDelivery case study are - Strategic Management Strategies, IT, Venture capital and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the GovDelivery casestudy better are - – 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%, there is increasing trade war between United States & China, increasing commodity prices, increasing household debt because of falling income levels, increasing government debt because of Covid-19 spendings, there is backlash against globalization,
competitive advantages are harder to sustain because of technology dispersion, increasing transportation and logistics costs, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in GovDelivery case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Burns Govdelivery, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Burns Govdelivery 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 GovDelivery can be done for the following purposes –
1. Strategic planning using facts provided in GovDelivery case study
2. Improving business portfolio management of Burns Govdelivery
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 Burns Govdelivery
Strengths GovDelivery | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Burns Govdelivery in GovDelivery Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of Burns Govdelivery in the sector have low bargaining power. GovDelivery has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Burns Govdelivery to manage not only supply disruptions but also source products at highly competitive prices.
Training and development
– Burns Govdelivery has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in GovDelivery 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.
Digital Transformation in Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Burns Govdelivery digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Burns Govdelivery has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Organizational Resilience of Burns Govdelivery
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Burns Govdelivery does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Learning organization
- Burns Govdelivery 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 Burns Govdelivery is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in GovDelivery Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Burns Govdelivery is present in almost all the verticals within the industry. This has provided firm in GovDelivery 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.
Highly skilled collaborators
– Burns Govdelivery 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 GovDelivery HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to lead change in Innovation & Entrepreneurship field
– Burns Govdelivery 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 Burns Govdelivery 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 Burns Govdelivery 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.
High brand equity
– Burns Govdelivery has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Burns Govdelivery to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Successful track record of launching new products
– Burns Govdelivery has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Burns Govdelivery 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.
High switching costs
– The high switching costs that Burns Govdelivery has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Weaknesses GovDelivery | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of GovDelivery are -
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study GovDelivery, in the dynamic environment Burns Govdelivery has struggled to respond to the nimble upstart competition. Burns Govdelivery has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow decision making process
– As mentioned earlier in the report, Burns Govdelivery 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. Burns Govdelivery 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.
Low market penetration in new markets
– Outside its home market of Burns Govdelivery, firm in the HBR case study GovDelivery needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Products dominated business model
– Even though Burns Govdelivery 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 - GovDelivery should strive to include more intangible value offerings along with its core products and services.
High cash cycle compare to competitors
Burns Govdelivery 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.
Need for greater diversity
– Burns Govdelivery 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study GovDelivery, is just above the industry average. Burns Govdelivery 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.
Skills based hiring
– The stress on hiring functional specialists at Burns Govdelivery 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.
Capital Spending Reduction
– Even during the low interest decade, Burns Govdelivery 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.
High operating costs
– Compare to the competitors, firm in the HBR case study GovDelivery 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 Burns Govdelivery 's lucrative customers.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Burns Govdelivery is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study GovDelivery can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities GovDelivery | 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 GovDelivery 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, Burns Govdelivery can use these opportunities to build new business models that can help the communities that Burns Govdelivery operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Burns Govdelivery 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 Burns Govdelivery to hire the very best people irrespective of their geographical location.
Building a culture of innovation
– managers at Burns Govdelivery 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.
Using analytics as competitive advantage
– Burns Govdelivery 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 GovDelivery - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Burns Govdelivery to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Low interest rates
– Even though inflation is raising its head in most developed economies, Burns Govdelivery 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Burns Govdelivery 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 Burns Govdelivery in the consumer business. Now Burns Govdelivery 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. Burns Govdelivery 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. Burns Govdelivery 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.
Developing new processes and practices
– Burns Govdelivery 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.
Loyalty marketing
– Burns Govdelivery 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.
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. Burns Govdelivery can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Burns Govdelivery is facing challenges because of the dominance of functional experts in the organization. GovDelivery 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 Burns Govdelivery 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.
Threats GovDelivery External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study GovDelivery are -
Shortening product life cycle
– it is one of the major threat that Burns Govdelivery is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
High dependence on third party suppliers
– Burns Govdelivery 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.
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.
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.
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. Burns Govdelivery 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Burns Govdelivery 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 GovDelivery .
Environmental challenges
– Burns Govdelivery 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. Burns Govdelivery can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Burns Govdelivery with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Burns Govdelivery.
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 Burns Govdelivery business can come under increasing regulations regarding data privacy, data security, etc.
Increasing wage structure of Burns Govdelivery
– 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 Burns Govdelivery.
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. Burns Govdelivery can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Burns Govdelivery needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.
Weighted SWOT Analysis of GovDelivery 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 GovDelivery 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 GovDelivery 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 GovDelivery 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 GovDelivery 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 Burns Govdelivery needs to make to build a sustainable competitive advantage.
