Case Study Description of Considerations for Entrepreneurial Acquisitions
This note synthesizes interviews with entrepreneurial acquirers and financiers from across the globe. The discussion and recommendations that follow reflect the varied experiences of entrepreneurial acquisitions practitioners and attempts to encapsulate the considerations any would-be entrepreneurs should bear in mind as they embark on the journey of acquiring an entrepreneurial opportunity.
Authors :: Ian Nieboer, Mathieu Carenzo, Antonio Davila
Swot Analysis of "Considerations for Entrepreneurial Acquisitions" written by Ian Nieboer, Mathieu Carenzo, Antonio Davila includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Entrepreneurial Considerations facing as an external strategic factors. Some of the topics covered in Considerations for Entrepreneurial Acquisitions case study are - Strategic Management Strategies, Entrepreneurship, Financial management and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Considerations for Entrepreneurial Acquisitions casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, wage bills are increasing, increasing transportation and logistics costs, increasing inequality as vast percentage of new income is going to the top 1%, supply chains are disrupted by pandemic , central banks are concerned over increasing inflation, challanges to central banks by blockchain based private currencies,
increasing energy prices, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Considerations for Entrepreneurial Acquisitions
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Considerations for Entrepreneurial Acquisitions case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Entrepreneurial Considerations, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Entrepreneurial Considerations 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 Considerations for Entrepreneurial Acquisitions can be done for the following purposes –
1. Strategic planning using facts provided in Considerations for Entrepreneurial Acquisitions case study
2. Improving business portfolio management of Entrepreneurial Considerations
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 Entrepreneurial Considerations
Strengths Considerations for Entrepreneurial Acquisitions | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Entrepreneurial Considerations in Considerations for Entrepreneurial Acquisitions Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of Entrepreneurial Considerations in the sector have low bargaining power. Considerations for Entrepreneurial Acquisitions has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Entrepreneurial Considerations to manage not only supply disruptions but also source products at highly competitive prices.
Cross disciplinary teams
– Horizontal connected teams at the Entrepreneurial Considerations 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.
Diverse revenue streams
– Entrepreneurial Considerations is present in almost all the verticals within the industry. This has provided firm in Considerations for Entrepreneurial Acquisitions 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.
Training and development
– Entrepreneurial Considerations has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Considerations for Entrepreneurial Acquisitions 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.
Successful track record of launching new products
– Entrepreneurial Considerations has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Entrepreneurial Considerations 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.
Organizational Resilience of Entrepreneurial Considerations
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Entrepreneurial Considerations does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Highly skilled collaborators
– Entrepreneurial Considerations 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 Considerations for Entrepreneurial Acquisitions HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Operational resilience
– The operational resilience strategy in the Considerations for Entrepreneurial Acquisitions 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.
Innovation driven organization
– Entrepreneurial Considerations is one of the most innovative firm in sector. Manager in Considerations for Entrepreneurial Acquisitions Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– Considerations for Entrepreneurial Acquisitions firm has clearly differentiated products in the market place. This has enabled Entrepreneurial Considerations to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Entrepreneurial Considerations to invest into research and development (R&D) and innovation.
Ability to recruit top talent
– Entrepreneurial Considerations is one of the leading recruiters in the industry. Managers in the Considerations for Entrepreneurial Acquisitions 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 Entrepreneurial Considerations in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses Considerations for Entrepreneurial Acquisitions | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Considerations for Entrepreneurial Acquisitions are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Considerations for Entrepreneurial Acquisitions 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 Entrepreneurial Considerations has relatively successful track record of launching new products.
Lack of clear differentiation of Entrepreneurial Considerations products
– To increase the profitability and margins on the products, Entrepreneurial Considerations needs to provide more differentiated products than what it is currently offering in the marketplace.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Considerations for Entrepreneurial Acquisitions, it seems that the employees of Entrepreneurial Considerations don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Workers concerns about automation
– As automation is fast increasing in the segment, Entrepreneurial Considerations 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.
High cash cycle compare to competitors
Entrepreneurial Considerations 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.
Low market penetration in new markets
– Outside its home market of Entrepreneurial Considerations, firm in the HBR case study Considerations for Entrepreneurial Acquisitions needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Products dominated business model
– Even though Entrepreneurial Considerations 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 - Considerations for Entrepreneurial Acquisitions should strive to include more intangible value offerings along with its core products and services.
Slow to strategic competitive environment developments
– As Considerations for Entrepreneurial Acquisitions HBR case study mentions - Entrepreneurial Considerations 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.
Capital Spending Reduction
– Even during the low interest decade, Entrepreneurial Considerations 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.
Need for greater diversity
– Entrepreneurial Considerations 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 harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Entrepreneurial Considerations is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Considerations for Entrepreneurial Acquisitions 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 Considerations for Entrepreneurial Acquisitions | 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 Considerations for Entrepreneurial Acquisitions are -
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 Entrepreneurial Considerations 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Entrepreneurial Considerations is facing challenges because of the dominance of functional experts in the organization. Considerations for Entrepreneurial Acquisitions 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.
Buying journey improvements
– Entrepreneurial Considerations can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Considerations for Entrepreneurial Acquisitions 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Entrepreneurial Considerations can use these opportunities to build new business models that can help the communities that Entrepreneurial Considerations operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Entrepreneurial Considerations can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Entrepreneurial Considerations 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, Entrepreneurial Considerations 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.
Manufacturing automation
– Entrepreneurial Considerations 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.
Better consumer reach
– The expansion of the 5G network will help Entrepreneurial Considerations to increase its market reach. Entrepreneurial Considerations will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Leveraging digital technologies
– Entrepreneurial Considerations 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.
Creating value in data economy
– The success of analytics program of Entrepreneurial Considerations has opened avenues for new revenue streams for the organization in the industry. This can help Entrepreneurial Considerations to build a more holistic ecosystem as suggested in the Considerations for Entrepreneurial Acquisitions case study. Entrepreneurial Considerations can build new products and services such as - data insight services, data privacy related products, data based consulting services, 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. Entrepreneurial Considerations can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Entrepreneurial Considerations 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 Considerations for Entrepreneurial Acquisitions External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Considerations for Entrepreneurial Acquisitions are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Entrepreneurial Considerations with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing wage structure of Entrepreneurial Considerations
– 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 Entrepreneurial Considerations.
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 Entrepreneurial Considerations business can come under increasing regulations regarding data privacy, data security, etc.
Consumer confidence and its impact on Entrepreneurial Considerations 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.
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.
High dependence on third party suppliers
– Entrepreneurial Considerations 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 Entrepreneurial Considerations.
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 Entrepreneurial Considerations in the Innovation & Entrepreneurship sector and impact the bottomline 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. Entrepreneurial Considerations 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.
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. Entrepreneurial Considerations can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Technology acceleration in Forth Industrial Revolution
– Entrepreneurial Considerations has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Entrepreneurial Considerations needs to keep up with the evolution of technology in the Innovation & Entrepreneurship sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Stagnating economy with rate increase
– Entrepreneurial Considerations 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.
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.
Weighted SWOT Analysis of Considerations for Entrepreneurial Acquisitions 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 Considerations for Entrepreneurial Acquisitions 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 Considerations for Entrepreneurial Acquisitions 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 Considerations for Entrepreneurial Acquisitions 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 Considerations for Entrepreneurial Acquisitions 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 Entrepreneurial Considerations needs to make to build a sustainable competitive advantage.