Playing With Fire at Sittercity (B) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Playing With Fire at Sittercity (B)
To help her finance her aggressive expansion plans, Genevieve Thiers plans to raise venture capital for the first time. She has spent the last six long years building Sittercity into the nation's leading babysitting web service, larger than all of its competitors combined. In the process, she brought her boyfriend and his sister into the business to help her, and ended up learning important lessons about mixing family and business. Now looking to raise venture capital, Thiers has just received an email from a general partner at a top VC firm, proposing another meeting and asking her to bring to the meeting an extensive list of proprietary information. This was a promising development, but Thiers was unsure whether she wanted to discuss Sittercity in such depth, especially when the venture capital firm had refused to sign a non-disclosure agreement. How should she respond?
Swot Analysis of "Playing With Fire at Sittercity (B)" written by Noam Wasserman, Rachel Gordon includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Sittercity Thiers facing as an external strategic factors. Some of the topics covered in Playing With Fire at Sittercity (B) case study are - Strategic Management Strategies, Competition, Entrepreneurship, Gender, Growth strategy, Internet, Leadership, Negotiations, Risk management and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Playing With Fire at Sittercity (B) casestudy better are - – technology disruption, competitive advantages are harder to sustain because of technology dispersion, talent flight as more people leaving formal jobs, increasing government debt because of Covid-19 spendings, customer relationship management is fast transforming because of increasing concerns over data privacy, central banks are concerned over increasing inflation, digital marketing is dominated by two big players Facebook and Google,
there is increasing trade war between United States & China, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Playing With Fire at Sittercity (B)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Playing With Fire at Sittercity (B) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Sittercity Thiers, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Sittercity Thiers 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 Playing With Fire at Sittercity (B) can be done for the following purposes –
1. Strategic planning using facts provided in Playing With Fire at Sittercity (B) case study
2. Improving business portfolio management of Sittercity Thiers
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 Sittercity Thiers
Strengths Playing With Fire at Sittercity (B) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Sittercity Thiers in Playing With Fire at Sittercity (B) Harvard Business Review case study are -
Learning organization
- Sittercity Thiers 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 Sittercity Thiers is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Playing With Fire at Sittercity (B) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– Playing With Fire at Sittercity (B) firm has clearly differentiated products in the market place. This has enabled Sittercity Thiers to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Sittercity Thiers to invest into research and development (R&D) and innovation.
Low bargaining power of suppliers
– Suppliers of Sittercity Thiers in the sector have low bargaining power. Playing With Fire at Sittercity (B) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Sittercity Thiers to manage not only supply disruptions but also source products at highly competitive prices.
Effective Research and Development (R&D)
– Sittercity Thiers 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 Playing With Fire at Sittercity (B) - 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 Sittercity Thiers in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High switching costs
– The high switching costs that Sittercity Thiers 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.
High brand equity
– Sittercity Thiers has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Sittercity Thiers to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Highly skilled collaborators
– Sittercity Thiers 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 Playing With Fire at Sittercity (B) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Analytics focus
– Sittercity Thiers 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 Noam Wasserman, Rachel Gordon 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.
Training and development
– Sittercity Thiers has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Playing With Fire at Sittercity (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.
Ability to lead change in Innovation & Entrepreneurship field
– Sittercity Thiers 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 Sittercity Thiers in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Strong track record of project management
– Sittercity Thiers is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses Playing With Fire at Sittercity (B) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Playing With Fire at Sittercity (B) are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Sittercity Thiers is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Playing With Fire at Sittercity (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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Playing With Fire at Sittercity (B), in the dynamic environment Sittercity Thiers has struggled to respond to the nimble upstart competition. Sittercity Thiers has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High bargaining power of channel partners
– Because of the regulatory requirements, Noam Wasserman, Rachel Gordon suggests that, Sittercity Thiers 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 Playing With Fire at Sittercity (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 Sittercity Thiers has relatively successful track record of launching new products.
No frontier risks strategy
– After analyzing the HBR case study Playing With Fire at Sittercity (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.
Workers concerns about automation
– As automation is fast increasing in the segment, Sittercity Thiers 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.
Lack of clear differentiation of Sittercity Thiers products
– To increase the profitability and margins on the products, Sittercity Thiers needs to provide more differentiated products than what it is currently offering in the marketplace.
Interest costs
– Compare to the competition, Sittercity Thiers 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.
High cash cycle compare to competitors
Sittercity Thiers 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
– Sittercity Thiers 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.
Slow to strategic competitive environment developments
– As Playing With Fire at Sittercity (B) HBR case study mentions - Sittercity Thiers 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.
Opportunities Playing With Fire at Sittercity (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 Playing With Fire at Sittercity (B) are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Sittercity Thiers can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Loyalty marketing
– Sittercity Thiers 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.
Building a culture of innovation
– managers at Sittercity Thiers can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Innovation & Entrepreneurship segment.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Innovation & Entrepreneurship industry, but it has also influenced the consumer preferences. Sittercity Thiers can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Low interest rates
– Even though inflation is raising its head in most developed economies, Sittercity Thiers 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.
Buying journey improvements
– Sittercity Thiers can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Playing With Fire at Sittercity (B) 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Sittercity Thiers 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.
Manufacturing automation
– Sittercity Thiers 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Sittercity Thiers 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, Playing With Fire at Sittercity (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.
Learning at scale
– Online learning technologies has now opened space for Sittercity Thiers to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Innovation & Entrepreneurship industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Sittercity Thiers 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. Sittercity Thiers 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Sittercity Thiers 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 Sittercity Thiers to hire the very best people irrespective of their geographical location.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Sittercity Thiers can use these opportunities to build new business models that can help the communities that Sittercity Thiers operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Threats Playing With Fire at Sittercity (B) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Playing With Fire at Sittercity (B) are -
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Sittercity Thiers with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Sittercity Thiers can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Sittercity Thiers 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 Playing With Fire at Sittercity (B) .
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Playing With Fire at Sittercity (B), Sittercity Thiers 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 .
Consumer confidence and its impact on Sittercity Thiers 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.
Increasing wage structure of Sittercity Thiers
– 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 Sittercity Thiers.
Stagnating economy with rate increase
– Sittercity Thiers 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.
Shortening product life cycle
– it is one of the major threat that Sittercity Thiers 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
– Sittercity Thiers 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.
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 Sittercity Thiers business can come under increasing regulations regarding data privacy, data security, etc.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Sittercity Thiers 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.
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 Sittercity Thiers in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Playing With Fire at Sittercity (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 Playing With Fire at Sittercity (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 Playing With Fire at Sittercity (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 Playing With Fire at Sittercity (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 Playing With Fire at Sittercity (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 Sittercity Thiers needs to make to build a sustainable competitive advantage.
