New Enterprise Associates in India: The Agile International Venture Capital Firm SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of New Enterprise Associates in India: The Agile International Venture Capital Firm
A swelling current account deficit, ballooning interest rates, and a plunging currency: These were just some of the worrisome trends in India that Krishna 'Kittu' Kolluri contemplated on his 20-hour return flight from Mumbai to Silicon Valley in September 2013. The U.S-based general partner co-leading India investments at New Enterprise Associates (NEA) reflected on how the American venture capital firm just 18 months earlier had set aside US$200 million of its US$2.6 billion world fund for investments in the sub-continent. Now Kolluri was mulling over whether to recommend changes to NEA's India strategy at the VC firm's quarterly general partner meeting in Washington, DC in October and the potential for missing out on lucrative investment opportunities in India if NEA played it too safe. This case closely examines how a venture capital firm creates and implements a strategy to invest outside the United States. It presents U.S. venture capital firm NEA's response to globalization and a contracting U.S. venture capital industry via an innovative global fund strategy that emphasizes agility in investment decision-making across and within geographies and sectors. The case focuses specifically on NEA's activities in India to illustrate the various elements of this strategy. It asks students to analyze the advantages and challenges of investing in an emerging market located half a world away both logistically and culturally, through a large, U.S.-based, multi-country venture fund. Students evaluate NEA's global fund strategy and determine the best investment strategy to follow in India given the country's deteriorating macro-economic situation at the time. They examine NEA's decision-making processes, communication channels, and incentive systems for its India practice. They gain a deeper understanding of what a U.S. venture capital firm like NEA expects from portfolio companies in emerging markets and what those portfolio companies receive in return.
Swot Analysis of "New Enterprise Associates in India: The Agile International Venture Capital Firm" written by Pamela Yatsko, Peter Ziebelman includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Nea's Nea facing as an external strategic factors. Some of the topics covered in New Enterprise Associates in India: The Agile International Venture Capital Firm case study are - Strategic Management Strategies, Decision making, Financial management, Globalization, Venture capital and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the New Enterprise Associates in India: The Agile International Venture Capital Firm casestudy better are - – challanges to central banks by blockchain based private currencies, cloud computing is disrupting traditional business models, digital marketing is dominated by two big players Facebook and Google, increasing government debt because of Covid-19 spendings, increasing inequality as vast percentage of new income is going to the top 1%, technology disruption, increasing energy prices,
talent flight as more people leaving formal jobs, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
Introduction to SWOT Analysis of New Enterprise Associates in India: The Agile International Venture Capital Firm
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in New Enterprise Associates in India: The Agile International Venture Capital Firm case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Nea's Nea, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Nea's Nea 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 New Enterprise Associates in India: The Agile International Venture Capital Firm can be done for the following purposes –
1. Strategic planning using facts provided in New Enterprise Associates in India: The Agile International Venture Capital Firm case study
2. Improving business portfolio management of Nea's Nea
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 Nea's Nea
Strengths New Enterprise Associates in India: The Agile International Venture Capital Firm | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Nea's Nea in New Enterprise Associates in India: The Agile International Venture Capital Firm Harvard Business Review case study are -
Training and development
– Nea's Nea has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in New Enterprise Associates in India: The Agile International Venture Capital Firm 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.
Strong track record of project management
– Nea's Nea is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Innovation driven organization
– Nea's Nea is one of the most innovative firm in sector. Manager in New Enterprise Associates in India: The Agile International Venture Capital Firm Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Learning organization
- Nea's Nea 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 Nea's Nea is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in New Enterprise Associates in India: The Agile International Venture Capital Firm Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Effective Research and Development (R&D)
– Nea's Nea 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 New Enterprise Associates in India: The Agile International Venture Capital Firm - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Diverse revenue streams
– Nea's Nea is present in almost all the verticals within the industry. This has provided firm in New Enterprise Associates in India: The Agile International Venture Capital Firm 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.
Ability to recruit top talent
– Nea's Nea is one of the leading recruiters in the industry. Managers in the New Enterprise Associates in India: The Agile International Venture Capital Firm are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Successful track record of launching new products
– Nea's Nea has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Nea's Nea 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.
Low bargaining power of suppliers
– Suppliers of Nea's Nea in the sector have low bargaining power. New Enterprise Associates in India: The Agile International Venture Capital Firm has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Nea's Nea to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that Nea's Nea 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.
Superior customer experience
– The customer experience strategy of Nea's Nea in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Analytics focus
– Nea's Nea 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 Pamela Yatsko, Peter Ziebelman 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.
Weaknesses New Enterprise Associates in India: The Agile International Venture Capital Firm | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of New Enterprise Associates in India: The Agile International Venture Capital Firm are -
Skills based hiring
– The stress on hiring functional specialists at Nea's Nea 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Nea's Nea 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Nea's Nea is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study New Enterprise Associates in India: The Agile International Venture Capital Firm can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
No frontier risks strategy
– After analyzing the HBR case study New Enterprise Associates in India: The Agile International Venture Capital Firm, 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.
Low market penetration in new markets
– Outside its home market of Nea's Nea, firm in the HBR case study New Enterprise Associates in India: The Agile International Venture Capital Firm needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow decision making process
– As mentioned earlier in the report, Nea's Nea 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. Nea's Nea 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.
Aligning sales with marketing
– It come across in the case study New Enterprise Associates in India: The Agile International Venture Capital Firm 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 New Enterprise Associates in India: The Agile International Venture Capital Firm can leverage the sales team experience to cultivate customer relationships as Nea's Nea is planning to shift buying processes online.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study New Enterprise Associates in India: The Agile International Venture Capital Firm, in the dynamic environment Nea's Nea has struggled to respond to the nimble upstart competition. Nea's Nea has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Interest costs
– Compare to the competition, Nea's Nea 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.
Products dominated business model
– Even though Nea's Nea 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 - New Enterprise Associates in India: The Agile International Venture Capital Firm should strive to include more intangible value offerings along with its core products and services.
Increasing silos among functional specialists
– The organizational structure of Nea's Nea is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Nea's Nea needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Nea's Nea to focus more on services rather than just following the product oriented approach.
Opportunities New Enterprise Associates in India: The Agile International Venture Capital Firm | 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 New Enterprise Associates in India: The Agile International Venture Capital Firm are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Nea's Nea is facing challenges because of the dominance of functional experts in the organization. New Enterprise Associates in India: The Agile International Venture Capital Firm 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Nea's Nea can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Nea's Nea in the consumer business. Now Nea's Nea can target international markets with far fewer capital restrictions requirements than the existing system.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Nea's Nea 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.
Using analytics as competitive advantage
– Nea's Nea 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 New Enterprise Associates in India: The Agile International Venture Capital Firm - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Nea's Nea to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Nea's Nea 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, New Enterprise Associates in India: The Agile International Venture Capital Firm, 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 Nea's Nea to increase its market reach. Nea's Nea 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
– Nea's Nea 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.
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 Nea's Nea 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.
Learning at scale
– Online learning technologies has now opened space for Nea's Nea 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.
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. Nea's Nea can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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. Nea's Nea 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. Nea's Nea 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Nea's Nea can use these opportunities to build new business models that can help the communities that Nea's Nea operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Threats New Enterprise Associates in India: The Agile International Venture Capital Firm External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study New Enterprise Associates in India: The Agile International Venture Capital Firm are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study New Enterprise Associates in India: The Agile International Venture Capital Firm, Nea's Nea 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 acceleration in Forth Industrial Revolution
– Nea's Nea has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Nea's Nea 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.
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. Nea's Nea 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.
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. Nea's Nea needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.
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 Nea's Nea in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Increasing wage structure of Nea's Nea
– 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 Nea's Nea.
Consumer confidence and its impact on Nea's Nea 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Nea's Nea 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.
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.
Environmental challenges
– Nea's Nea 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. Nea's Nea can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
Stagnating economy with rate increase
– Nea's Nea 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.
Regulatory challenges
– Nea's Nea 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.
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 Nea's Nea business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of New Enterprise Associates in India: The Agile International Venture Capital Firm 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 New Enterprise Associates in India: The Agile International Venture Capital Firm 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 New Enterprise Associates in India: The Agile International Venture Capital Firm 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 New Enterprise Associates in India: The Agile International Venture Capital Firm 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 New Enterprise Associates in India: The Agile International Venture Capital Firm 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 Nea's Nea needs to make to build a sustainable competitive advantage.