Case Study Description of DPSC Software: Post-acquisition Evaluation
DPSC created and marketed a range of compliance software to banks. Nine months after DPSC was purchased by Netzee, Netzee was in financial trouble. Since Netzee had purchased DPSC, DPSC's founder felt that Netzee had not fully utilized the potential of DPSC. He wanted to share his assessment of the merger and thoughts on future strategy with the new Netzee chief executive officer.
Swot Analysis of "DPSC Software: Post-acquisition Evaluation" written by Michael Parent, Ken Mark includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Dpsc Netzee facing as an external strategic factors. Some of the topics covered in DPSC Software: Post-acquisition Evaluation case study are - Strategic Management Strategies, Entrepreneurship, Strategic planning and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the DPSC Software: Post-acquisition Evaluation casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, competitive advantages are harder to sustain because of technology dispersion, challanges to central banks by blockchain based private currencies, there is backlash against globalization, central banks are concerned over increasing inflation, increasing government debt because of Covid-19 spendings, increasing transportation and logistics costs,
increasing energy prices, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of DPSC Software: Post-acquisition Evaluation
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in DPSC Software: Post-acquisition Evaluation case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Dpsc Netzee, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Dpsc Netzee 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 DPSC Software: Post-acquisition Evaluation can be done for the following purposes –
1. Strategic planning using facts provided in DPSC Software: Post-acquisition Evaluation case study
2. Improving business portfolio management of Dpsc Netzee
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 Dpsc Netzee
Strengths DPSC Software: Post-acquisition Evaluation | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Dpsc Netzee in DPSC Software: Post-acquisition Evaluation Harvard Business Review case study are -
Effective Research and Development (R&D)
– Dpsc Netzee 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 DPSC Software: Post-acquisition Evaluation - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Cross disciplinary teams
– Horizontal connected teams at the Dpsc Netzee 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.
Highly skilled collaborators
– Dpsc Netzee 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 DPSC Software: Post-acquisition Evaluation HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of Dpsc Netzee
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Dpsc Netzee does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High brand equity
– Dpsc Netzee has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Dpsc Netzee to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of Dpsc Netzee in the sector have low bargaining power. DPSC Software: Post-acquisition Evaluation has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Dpsc Netzee to manage not only supply disruptions but also source products at highly competitive prices.
Training and development
– Dpsc Netzee has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in DPSC Software: Post-acquisition Evaluation 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.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– DPSC Software: Post-acquisition Evaluation firm has clearly differentiated products in the market place. This has enabled Dpsc Netzee to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Dpsc Netzee to invest into research and development (R&D) and innovation.
Digital Transformation in Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Dpsc Netzee digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Dpsc Netzee 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.
High switching costs
– The high switching costs that Dpsc Netzee 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.
Ability to recruit top talent
– Dpsc Netzee is one of the leading recruiters in the industry. Managers in the DPSC Software: Post-acquisition Evaluation are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Superior customer experience
– The customer experience strategy of Dpsc Netzee in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses DPSC Software: Post-acquisition Evaluation | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of DPSC Software: Post-acquisition Evaluation are -
High operating costs
– Compare to the competitors, firm in the HBR case study DPSC Software: Post-acquisition Evaluation 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 Dpsc Netzee 's lucrative customers.
Lack of clear differentiation of Dpsc Netzee products
– To increase the profitability and margins on the products, Dpsc Netzee needs to provide more differentiated products than what it is currently offering in the marketplace.
Skills based hiring
– The stress on hiring functional specialists at Dpsc Netzee 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.
Slow decision making process
– As mentioned earlier in the report, Dpsc Netzee 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. Dpsc Netzee 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 Dpsc Netzee, firm in the HBR case study DPSC Software: Post-acquisition Evaluation needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Capital Spending Reduction
– Even during the low interest decade, Dpsc Netzee 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.
Interest costs
– Compare to the competition, Dpsc Netzee 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study DPSC Software: Post-acquisition Evaluation, in the dynamic environment Dpsc Netzee has struggled to respond to the nimble upstart competition. Dpsc Netzee 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, Dpsc Netzee is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study DPSC Software: Post-acquisition Evaluation can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Dpsc Netzee 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.
Products dominated business model
– Even though Dpsc Netzee 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 - DPSC Software: Post-acquisition Evaluation should strive to include more intangible value offerings along with its core products and services.
Opportunities DPSC Software: Post-acquisition Evaluation | 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 DPSC Software: Post-acquisition Evaluation are -
Building a culture of innovation
– managers at Dpsc Netzee 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.
Creating value in data economy
– The success of analytics program of Dpsc Netzee has opened avenues for new revenue streams for the organization in the industry. This can help Dpsc Netzee to build a more holistic ecosystem as suggested in the DPSC Software: Post-acquisition Evaluation case study. Dpsc Netzee can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Low interest rates
– Even though inflation is raising its head in most developed economies, Dpsc Netzee 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
– Dpsc Netzee can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. DPSC Software: Post-acquisition Evaluation 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Dpsc Netzee 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, DPSC Software: Post-acquisition Evaluation, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Better consumer reach
– The expansion of the 5G network will help Dpsc Netzee to increase its market reach. Dpsc Netzee will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Dpsc Netzee in the consumer business. Now Dpsc Netzee 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 Dpsc Netzee 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.
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. Dpsc Netzee can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Dpsc Netzee can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Leveraging digital technologies
– Dpsc Netzee 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.
Using analytics as competitive advantage
– Dpsc Netzee 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 DPSC Software: Post-acquisition Evaluation - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Dpsc Netzee to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Dpsc Netzee is facing challenges because of the dominance of functional experts in the organization. DPSC Software: Post-acquisition Evaluation 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.
Threats DPSC Software: Post-acquisition Evaluation External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study DPSC Software: Post-acquisition Evaluation are -
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 Dpsc Netzee in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Regulatory challenges
– Dpsc Netzee needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Innovation & Entrepreneurship industry regulations.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study DPSC Software: Post-acquisition Evaluation, Dpsc Netzee 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 .
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 international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Dpsc Netzee 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 DPSC Software: Post-acquisition Evaluation .
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. Dpsc Netzee needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.
Increasing wage structure of Dpsc Netzee
– 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 Dpsc Netzee.
Environmental challenges
– Dpsc Netzee 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. Dpsc Netzee can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
High dependence on third party suppliers
– Dpsc Netzee 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.
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 Dpsc Netzee.
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. Dpsc Netzee 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Dpsc Netzee 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.
Stagnating economy with rate increase
– Dpsc Netzee 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.
Weighted SWOT Analysis of DPSC Software: Post-acquisition Evaluation 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 DPSC Software: Post-acquisition Evaluation 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 DPSC Software: Post-acquisition Evaluation 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 DPSC Software: Post-acquisition Evaluation 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 DPSC Software: Post-acquisition Evaluation 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 Dpsc Netzee needs to make to build a sustainable competitive advantage.
