VC Decision-Making in India: Aavishkaar and Milk Mantra (B) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of VC Decision-Making in India: Aavishkaar and Milk Mantra (B)
The case profiles the protagonist, Vineet Rai, managing partner of Aavishkaar Venture Management Services (an Indian, early stage VC firm with a focus on rural, underserved regions and sectors), as he seeks to build on the initial traction of his first venture fund and strives to raise a second, larger, and more ambitious fund. The case discusses Rai's "lessons learned" from his first fund (profiled in Case A), and discusses how such lessons have informed a changed approach to the Aavishkaar thesis and fund structure. It also provides a series of snapshots from prospective LPs in the fund being raised.
Swot Analysis of "VC Decision-Making in India: Aavishkaar and Milk Mantra (B)" written by Justin Randolph, Ilya Strebulaev includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Aavishkaar Fund facing as an external strategic factors. Some of the topics covered in VC Decision-Making in India: Aavishkaar and Milk Mantra (B) case study are - Strategic Management Strategies, Financial management, Marketing and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the VC Decision-Making in India: Aavishkaar and Milk Mantra (B) casestudy better are - – central banks are concerned over increasing inflation, increasing energy prices, customer relationship management is fast transforming because of increasing concerns over data privacy, digital marketing is dominated by two big players Facebook and Google, banking and financial system is disrupted by Bitcoin and other crypto currencies, there is backlash against globalization, challanges to central banks by blockchain based private currencies,
cloud computing is disrupting traditional business models, wage bills are increasing, etc
Introduction to SWOT Analysis of VC Decision-Making in India: Aavishkaar and Milk Mantra (B)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in VC Decision-Making in India: Aavishkaar and Milk Mantra (B) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Aavishkaar Fund, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Aavishkaar Fund 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 VC Decision-Making in India: Aavishkaar and Milk Mantra (B) can be done for the following purposes –
1. Strategic planning using facts provided in VC Decision-Making in India: Aavishkaar and Milk Mantra (B) case study
2. Improving business portfolio management of Aavishkaar Fund
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 Aavishkaar Fund
Strengths VC Decision-Making in India: Aavishkaar and Milk Mantra (B) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Aavishkaar Fund in VC Decision-Making in India: Aavishkaar and Milk Mantra (B) Harvard Business Review case study are -
High switching costs
– The high switching costs that Aavishkaar Fund 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.
Digital Transformation in Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Aavishkaar Fund digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Aavishkaar Fund 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.
Cross disciplinary teams
– Horizontal connected teams at the Aavishkaar Fund 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.
Strong track record of project management
– Aavishkaar Fund is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Operational resilience
– The operational resilience strategy in the VC Decision-Making in India: Aavishkaar and Milk Mantra (B) 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.
Analytics focus
– Aavishkaar Fund 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 Justin Randolph, Ilya Strebulaev 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.
High brand equity
– Aavishkaar Fund has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Aavishkaar Fund to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Highly skilled collaborators
– Aavishkaar Fund 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 VC Decision-Making in India: Aavishkaar and Milk Mantra (B) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Superior customer experience
– The customer experience strategy of Aavishkaar Fund in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– VC Decision-Making in India: Aavishkaar and Milk Mantra (B) firm has clearly differentiated products in the market place. This has enabled Aavishkaar Fund to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Aavishkaar Fund to invest into research and development (R&D) and innovation.
Innovation driven organization
– Aavishkaar Fund is one of the most innovative firm in sector. Manager in VC Decision-Making in India: Aavishkaar and Milk Mantra (B) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Training and development
– Aavishkaar Fund has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in VC Decision-Making in India: Aavishkaar and Milk Mantra (B) Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Weaknesses VC Decision-Making in India: Aavishkaar and Milk Mantra (B) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of VC Decision-Making in India: Aavishkaar and Milk Mantra (B) are -
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study VC Decision-Making in India: Aavishkaar and Milk Mantra (B), in the dynamic environment Aavishkaar Fund has struggled to respond to the nimble upstart competition. Aavishkaar Fund has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study VC Decision-Making in India: Aavishkaar and Milk Mantra (B), is just above the industry average. Aavishkaar Fund needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Aavishkaar Fund is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study VC Decision-Making in India: Aavishkaar and Milk Mantra (B) can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Skills based hiring
– The stress on hiring functional specialists at Aavishkaar Fund 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.
Aligning sales with marketing
– It come across in the case study VC Decision-Making in India: Aavishkaar and Milk Mantra (B) that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case VC Decision-Making in India: Aavishkaar and Milk Mantra (B) can leverage the sales team experience to cultivate customer relationships as Aavishkaar Fund is planning to shift buying processes online.
Slow decision making process
– As mentioned earlier in the report, Aavishkaar Fund 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. Aavishkaar Fund 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, Justin Randolph, Ilya Strebulaev suggests that, Aavishkaar Fund 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the VC Decision-Making in India: Aavishkaar and Milk Mantra (B) 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 Aavishkaar Fund has relatively successful track record of launching new products.
No frontier risks strategy
– After analyzing the HBR case study VC Decision-Making in India: Aavishkaar and Milk Mantra (B), 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.
Increasing silos among functional specialists
– The organizational structure of Aavishkaar Fund is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Aavishkaar Fund needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Aavishkaar Fund to focus more on services rather than just following the product oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Aavishkaar Fund 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.
Opportunities VC Decision-Making in India: Aavishkaar and Milk Mantra (B) | 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 VC Decision-Making in India: Aavishkaar and Milk Mantra (B) are -
Learning at scale
– Online learning technologies has now opened space for Aavishkaar Fund 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.
Manufacturing automation
– Aavishkaar Fund 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Aavishkaar Fund 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Aavishkaar Fund 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
– Aavishkaar Fund 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, Aavishkaar Fund 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, VC Decision-Making in India: Aavishkaar and Milk Mantra (B), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Aavishkaar Fund 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 Aavishkaar Fund to hire the very best people irrespective of their geographical location.
Loyalty marketing
– Aavishkaar Fund 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.
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. Aavishkaar Fund can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Leveraging digital technologies
– Aavishkaar Fund 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Aavishkaar Fund 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.
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 Aavishkaar Fund in the consumer business. Now Aavishkaar Fund can target international markets with far fewer capital restrictions requirements than the existing system.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Aavishkaar Fund 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 VC Decision-Making in India: Aavishkaar and Milk Mantra (B) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study VC Decision-Making in India: Aavishkaar and Milk Mantra (B) are -
Regulatory challenges
– Aavishkaar Fund needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Innovation & Entrepreneurship industry regulations.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Increasing wage structure of Aavishkaar Fund
– 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 Aavishkaar Fund.
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 Aavishkaar Fund in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Shortening product life cycle
– it is one of the major threat that Aavishkaar Fund is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Aavishkaar Fund 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 VC Decision-Making in India: Aavishkaar and Milk Mantra (B) .
Environmental challenges
– Aavishkaar Fund 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. Aavishkaar Fund can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
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. Aavishkaar Fund can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Aavishkaar Fund 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 Aavishkaar Fund business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Aavishkaar Fund 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study VC Decision-Making in India: Aavishkaar and Milk Mantra (B), Aavishkaar Fund 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 Aavishkaar Fund.
Weighted SWOT Analysis of VC Decision-Making in India: Aavishkaar and Milk Mantra (B) 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 VC Decision-Making in India: Aavishkaar and Milk Mantra (B) 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 VC Decision-Making in India: Aavishkaar and Milk Mantra (B) 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 VC Decision-Making in India: Aavishkaar and Milk Mantra (B) 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 VC Decision-Making in India: Aavishkaar and Milk Mantra (B) 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 Aavishkaar Fund needs to make to build a sustainable competitive advantage.