East Solutions: Transforming a BPO Provider in India SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of East Solutions: Transforming a BPO Provider in India
East Solutions was a successful business process outsourcing (BPO) provider based in Bangalore, India. Although salaries for Indian IT professionals were about half of those of their counterparts in the United States, the board of directors at East Solutions recognized a worrying trend: if salaries in India continued to grow at a fast rate, they would soon erode the cost advantage of sending work to India and potentially threaten the entire Indian BPO industry. As a solution, East Solutions repositioned itself by leveraging technical, industry and process expertise to form a partnership with clients based on value added in addition to cost savings. This plan required East Solutions to refocus on fewer geographic and sector groups. It also required transforming the role of the company's IT managers, who needed extensive training, additional resources and a new compensation strategy. On an average year, the new compensation plan increased the IT managers' incomes by 4 per cent, so it was expected to be popular, but IT managers rejected the new compensation plan and it was abandoned after 18 months. The chief executive officer (CEO) in charge of the new plan for East Solutions was unsure why it had failed. Author Scott Walsworth is affiliated with University of Saskatchewan.
Swot Analysis of "East Solutions: Transforming a BPO Provider in India" written by Scott Walsworth includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that East Solutions facing as an external strategic factors. Some of the topics covered in East Solutions: Transforming a BPO Provider in India case study are - Strategic Management Strategies, and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the East Solutions: Transforming a BPO Provider in India casestudy better are - – increasing energy prices, cloud computing is disrupting traditional business models, wage bills are increasing, there is increasing trade war between United States & China, increasing commodity prices, increasing transportation and logistics costs, there is backlash against globalization,
talent flight as more people leaving formal jobs, banking and financial system is disrupted by Bitcoin and other crypto currencies, etc
Introduction to SWOT Analysis of East Solutions: Transforming a BPO Provider in India
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in East Solutions: Transforming a BPO Provider in India case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the East Solutions, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which East Solutions 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 East Solutions: Transforming a BPO Provider in India can be done for the following purposes –
1. Strategic planning using facts provided in East Solutions: Transforming a BPO Provider in India case study
2. Improving business portfolio management of East Solutions
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 East Solutions
Strengths East Solutions: Transforming a BPO Provider in India | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of East Solutions in East Solutions: Transforming a BPO Provider in India Harvard Business Review case study are -
Diverse revenue streams
– East Solutions is present in almost all the verticals within the industry. This has provided firm in East Solutions: Transforming a BPO Provider in India 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.
Strong track record of project management
– East Solutions is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Learning organization
- East Solutions 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 East Solutions is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in East Solutions: Transforming a BPO Provider in India Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– East Solutions is one of the most innovative firm in sector. Manager in East Solutions: Transforming a BPO Provider in India 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 Leadership & Managing People industry
– East Solutions: Transforming a BPO Provider in India firm has clearly differentiated products in the market place. This has enabled East Solutions to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped East Solutions to invest into research and development (R&D) and innovation.
Low bargaining power of suppliers
– Suppliers of East Solutions in the sector have low bargaining power. East Solutions: Transforming a BPO Provider in India has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps East Solutions to manage not only supply disruptions but also source products at highly competitive prices.
Cross disciplinary teams
– Horizontal connected teams at the East Solutions 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.
High switching costs
– The high switching costs that East Solutions 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.
Effective Research and Development (R&D)
– East Solutions 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 East Solutions: Transforming a BPO Provider in India - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Highly skilled collaborators
– East Solutions 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 East Solutions: Transforming a BPO Provider in India HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Training and development
– East Solutions has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in East Solutions: Transforming a BPO Provider in India 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
– East Solutions has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. East Solutions 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.
Weaknesses East Solutions: Transforming a BPO Provider in India | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of East Solutions: Transforming a BPO Provider in India are -
Lack of clear differentiation of East Solutions products
– To increase the profitability and margins on the products, East Solutions needs to provide more differentiated products than what it is currently offering in the marketplace.
High bargaining power of channel partners
– Because of the regulatory requirements, Scott Walsworth suggests that, East Solutions 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study East Solutions: Transforming a BPO Provider in India, in the dynamic environment East Solutions has struggled to respond to the nimble upstart competition. East Solutions 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, East Solutions 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 East Solutions 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 - East Solutions: Transforming a BPO Provider in India 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 East Solutions: Transforming a BPO Provider in India, it seems that the employees of East Solutions 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.
Need for greater diversity
– East Solutions 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.
Workers concerns about automation
– As automation is fast increasing in the segment, East Solutions 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.
Skills based hiring
– The stress on hiring functional specialists at East Solutions 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.
Capital Spending Reduction
– Even during the low interest decade, East Solutions 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, East Solutions is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study East Solutions: Transforming a BPO Provider in India 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 East Solutions: Transforming a BPO Provider in India | 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 East Solutions: Transforming a BPO Provider in India are -
Leveraging digital technologies
– East Solutions 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, East Solutions is facing challenges because of the dominance of functional experts in the organization. East Solutions: Transforming a BPO Provider in India 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, East Solutions can use these opportunities to build new business models that can help the communities that East Solutions operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Creating value in data economy
– The success of analytics program of East Solutions has opened avenues for new revenue streams for the organization in the industry. This can help East Solutions to build a more holistic ecosystem as suggested in the East Solutions: Transforming a BPO Provider in India case study. East Solutions can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at East Solutions 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 Leadership & Managing People segment.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Leadership & Managing People industry, but it has also influenced the consumer preferences. East Solutions can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Developing new processes and practices
– East Solutions 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for East Solutions 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Leadership & Managing People industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. East Solutions 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. East Solutions 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, East Solutions 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, East Solutions: Transforming a BPO Provider in India, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Buying journey improvements
– East Solutions can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. East Solutions: Transforming a BPO Provider in India 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, East Solutions 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.
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. East Solutions can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats East Solutions: Transforming a BPO Provider in India External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study East Solutions: Transforming a BPO Provider in India 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study East Solutions: Transforming a BPO Provider in India, East Solutions may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Leadership & Managing People .
Increasing wage structure of East Solutions
– 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 East Solutions.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents East Solutions with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Shortening product life cycle
– it is one of the major threat that East Solutions is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Technology acceleration in Forth Industrial Revolution
– East Solutions has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, East Solutions needs to keep up with the evolution of technology in the Leadership & Managing People 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.
Regulatory challenges
– East Solutions 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 Leadership & Managing People industry regulations.
Stagnating economy with rate increase
– East Solutions 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.
Easy access to finance
– Easy access to finance in Leadership & Managing People field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. East Solutions can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 East Solutions business can come under increasing regulations regarding data privacy, data security, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for East Solutions 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.
High dependence on third party suppliers
– East Solutions 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.
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 East Solutions in the Leadership & Managing People sector and impact the bottomline of the organization.
Weighted SWOT Analysis of East Solutions: Transforming a BPO Provider in India 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 East Solutions: Transforming a BPO Provider in India 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 East Solutions: Transforming a BPO Provider in India 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 East Solutions: Transforming a BPO Provider in India 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 East Solutions: Transforming a BPO Provider in India 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 East Solutions needs to make to build a sustainable competitive advantage.