Case Study Description of STATER NV: E-Servicing Strategies
After 2 years of on-line experiments, Tom van Vianen, CEO, felt certain it was time to fully implement STATER NV's new 'e-servicing' concept with a cohesive strategy. Established in 1997 in The Netherlands and headquartered in Amersfoort, STATER had 27 business clients and serviced over 80 different mortgage portfolios of more than 450,000 mainly residential loans in the Netherlands, Belgium, and Germany. Their mortgage service operations and information systems were considered state-of-the-art in 2002, but they were moving business on-line while simultaneously increasing the types of services provided and expanding operations into Spain, France, and Italy - within the next five years. In a land known for taming the forces of the sea, Tom faced what seemed like a sea of 'e-uncertainty.' What exact roles should STATER play in an on-line loan market? How should they position themselves to lead in those roles? The E-Servicing Steering Committee looked to Tom to direct them, and he knew he needed a clear vision for the next Steering Committee meeting in 2 months, in May 2002.
Swot Analysis of "STATER NV: E-Servicing Strategies" written by Scott L. Schneberger includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Stater Servicing facing as an external strategic factors. Some of the topics covered in STATER NV: E-Servicing Strategies case study are - Strategic Management Strategies, Strategy and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the STATER NV: E-Servicing Strategies casestudy better are - – technology disruption, geopolitical disruptions, wage bills are increasing, challanges to central banks by blockchain based private currencies, increasing transportation and logistics costs, increasing household debt because of falling income levels, competitive advantages are harder to sustain because of technology dispersion,
increasing inequality as vast percentage of new income is going to the top 1%, talent flight as more people leaving formal jobs, etc
Introduction to SWOT Analysis of STATER NV: E-Servicing Strategies
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in STATER NV: E-Servicing Strategies case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Stater Servicing, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Stater Servicing 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 STATER NV: E-Servicing Strategies can be done for the following purposes –
1. Strategic planning using facts provided in STATER NV: E-Servicing Strategies case study
2. Improving business portfolio management of Stater Servicing
3. Assessing feasibility of the new initiative in Leadership & Managing People field.
4. Making a Leadership & Managing People topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Stater Servicing
Strengths STATER NV: E-Servicing Strategies | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Stater Servicing in STATER NV: E-Servicing Strategies Harvard Business Review case study are -
Ability to lead change in Leadership & Managing People field
– Stater Servicing 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 Stater Servicing in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Stater Servicing digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Stater Servicing 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 Stater Servicing 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.
Organizational Resilience of Stater Servicing
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Stater Servicing does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Effective Research and Development (R&D)
– Stater Servicing 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 STATER NV: E-Servicing Strategies - 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 Stater Servicing 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.
Sustainable margins compare to other players in Leadership & Managing People industry
– STATER NV: E-Servicing Strategies firm has clearly differentiated products in the market place. This has enabled Stater Servicing to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Stater Servicing to invest into research and development (R&D) and innovation.
Innovation driven organization
– Stater Servicing is one of the most innovative firm in sector. Manager in STATER NV: E-Servicing Strategies Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Highly skilled collaborators
– Stater Servicing 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 STATER NV: E-Servicing Strategies HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– Stater Servicing has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Stater Servicing 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.
Superior customer experience
– The customer experience strategy of Stater Servicing in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Operational resilience
– The operational resilience strategy in the STATER NV: E-Servicing Strategies 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.
Weaknesses STATER NV: E-Servicing Strategies | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of STATER NV: E-Servicing Strategies are -
Interest costs
– Compare to the competition, Stater Servicing 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.
Aligning sales with marketing
– It come across in the case study STATER NV: E-Servicing Strategies 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 STATER NV: E-Servicing Strategies can leverage the sales team experience to cultivate customer relationships as Stater Servicing is planning to shift buying processes online.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Stater Servicing is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study STATER NV: E-Servicing Strategies can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
High cash cycle compare to competitors
Stater Servicing 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.
No frontier risks strategy
– After analyzing the HBR case study STATER NV: E-Servicing Strategies, it seems that company is thinking about the frontier risks that can impact Leadership & Managing People 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Scott L. Schneberger suggests that, Stater Servicing 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.
Skills based hiring
– The stress on hiring functional specialists at Stater Servicing 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.
Lack of clear differentiation of Stater Servicing products
– To increase the profitability and margins on the products, Stater Servicing needs to provide more differentiated products than what it is currently offering in the marketplace.
Products dominated business model
– Even though Stater Servicing 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 - STATER NV: E-Servicing Strategies should strive to include more intangible value offerings along with its core products and services.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study STATER NV: E-Servicing Strategies, it seems that the employees of Stater Servicing 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study STATER NV: E-Servicing Strategies, in the dynamic environment Stater Servicing has struggled to respond to the nimble upstart competition. Stater Servicing has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Opportunities STATER NV: E-Servicing Strategies | 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 STATER NV: E-Servicing Strategies are -
Better consumer reach
– The expansion of the 5G network will help Stater Servicing to increase its market reach. Stater Servicing 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Stater Servicing 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
– Stater Servicing 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Stater Servicing is facing challenges because of the dominance of functional experts in the organization. STATER NV: E-Servicing Strategies 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Stater Servicing in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Leadership & Managing People segment, and it will provide faster access to the consumers.
Loyalty marketing
– Stater Servicing 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Stater Servicing 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 Stater Servicing to hire the very best people irrespective of their geographical location.
Buying journey improvements
– Stater Servicing can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. STATER NV: E-Servicing Strategies 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, Stater Servicing can use these opportunities to build new business models that can help the communities that Stater Servicing operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Developing new processes and practices
– Stater Servicing can develop new processes and procedures in Leadership & Managing People industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Stater Servicing 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, STATER NV: E-Servicing Strategies, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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 Stater Servicing in the consumer business. Now Stater Servicing can target international markets with far fewer capital restrictions requirements than the existing system.
Manufacturing automation
– Stater Servicing can use the latest technology developments to improve its manufacturing and designing process in Leadership & Managing People 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.
Threats STATER NV: E-Servicing Strategies External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study STATER NV: E-Servicing Strategies are -
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.
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 Stater Servicing business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Stater Servicing 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Stater Servicing 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 STATER NV: E-Servicing Strategies .
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 Stater Servicing in the Leadership & Managing People sector and impact the bottomline of the organization.
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 Stater Servicing.
Shortening product life cycle
– it is one of the major threat that Stater Servicing is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Stagnating economy with rate increase
– Stater Servicing 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Stater Servicing in the Leadership & Managing People industry. The Leadership & Managing People 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.
Environmental challenges
– Stater Servicing 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. Stater Servicing can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Increasing wage structure of Stater Servicing
– 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 Stater Servicing.
Consumer confidence and its impact on Stater Servicing 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.
Weighted SWOT Analysis of STATER NV: E-Servicing Strategies 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 STATER NV: E-Servicing Strategies 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 STATER NV: E-Servicing Strategies 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 STATER NV: E-Servicing Strategies 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 STATER NV: E-Servicing Strategies 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 Stater Servicing needs to make to build a sustainable competitive advantage.