Invest or Take: A Venture Capitalist's Ethical Dilemma SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Invest or Take: A Venture Capitalist's Ethical Dilemma
In May 2015, a managing partner in an Australian venture capital firm faced a major dilemma. As one of five partners, he held the deciding vote on whether his firm, KTN Capital, would take an entrepreneur's idea for a solar-powered water filter and build a new company around it, or instead, invest in the entrepreneur's company. The venture capital firm would not be doing anything illegal by taking the entrepreneur's idea because the entrepreneur had not properly protected his intellectual property through patents, but the decision-maker was struggling with the ethics of that choice. To further complicate the situation, the entrepreneur was very difficult to deal with, and the investment firm was facing pressure from the fund's investors to find investments that would yield big returns. The managing partner had many business and ethical considerations to factor into his decision, and it seemed there would be no easy choice. Jon Carrick is affiliated with Stetson University.
Swot Analysis of "Invest or Take: A Venture Capitalist's Ethical Dilemma" written by Jon Carrick includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Entrepreneur's Carrick facing as an external strategic factors. Some of the topics covered in Invest or Take: A Venture Capitalist's Ethical Dilemma case study are - Strategic Management Strategies, and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Invest or Take: A Venture Capitalist's Ethical Dilemma casestudy better are - – increasing commodity prices, technology disruption, geopolitical disruptions, there is backlash against globalization, central banks are concerned over increasing inflation, increasing energy prices, banking and financial system is disrupted by Bitcoin and other crypto currencies,
increasing government debt because of Covid-19 spendings, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Invest or Take: A Venture Capitalist's Ethical Dilemma
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Invest or Take: A Venture Capitalist's Ethical Dilemma case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Entrepreneur's Carrick, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Entrepreneur's Carrick 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 Invest or Take: A Venture Capitalist's Ethical Dilemma can be done for the following purposes –
1. Strategic planning using facts provided in Invest or Take: A Venture Capitalist's Ethical Dilemma case study
2. Improving business portfolio management of Entrepreneur's Carrick
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 Entrepreneur's Carrick
Strengths Invest or Take: A Venture Capitalist's Ethical Dilemma | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Entrepreneur's Carrick in Invest or Take: A Venture Capitalist's Ethical Dilemma Harvard Business Review case study are -
Organizational Resilience of Entrepreneur's Carrick
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Entrepreneur's Carrick does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High brand equity
– Entrepreneur's Carrick has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Entrepreneur's Carrick to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Learning organization
- Entrepreneur's Carrick 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 Entrepreneur's Carrick is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Invest or Take: A Venture Capitalist's Ethical Dilemma Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Effective Research and Development (R&D)
– Entrepreneur's Carrick 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 Invest or Take: A Venture Capitalist's Ethical Dilemma - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Innovation driven organization
– Entrepreneur's Carrick is one of the most innovative firm in sector. Manager in Invest or Take: A Venture Capitalist's Ethical Dilemma Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Superior customer experience
– The customer experience strategy of Entrepreneur's Carrick in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Strong track record of project management
– Entrepreneur's Carrick is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Analytics focus
– Entrepreneur's Carrick 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 Jon Carrick 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.
Successful track record of launching new products
– Entrepreneur's Carrick has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Entrepreneur's Carrick 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.
High switching costs
– The high switching costs that Entrepreneur's Carrick has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Ability to lead change in Leadership & Managing People field
– Entrepreneur's Carrick 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 Entrepreneur's Carrick in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Training and development
– Entrepreneur's Carrick has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Invest or Take: A Venture Capitalist's Ethical Dilemma 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.
Weaknesses Invest or Take: A Venture Capitalist's Ethical Dilemma | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Invest or Take: A Venture Capitalist's Ethical Dilemma are -
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Invest or Take: A Venture Capitalist's Ethical Dilemma, is just above the industry average. Entrepreneur's Carrick needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Interest costs
– Compare to the competition, Entrepreneur's Carrick 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.
Need for greater diversity
– Entrepreneur's Carrick 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.
Skills based hiring
– The stress on hiring functional specialists at Entrepreneur's Carrick 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Invest or Take: A Venture Capitalist's Ethical Dilemma, in the dynamic environment Entrepreneur's Carrick has struggled to respond to the nimble upstart competition. Entrepreneur's Carrick has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High operating costs
– Compare to the competitors, firm in the HBR case study Invest or Take: A Venture Capitalist's Ethical Dilemma has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Entrepreneur's Carrick 's lucrative customers.
Low market penetration in new markets
– Outside its home market of Entrepreneur's Carrick, firm in the HBR case study Invest or Take: A Venture Capitalist's Ethical Dilemma needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to strategic competitive environment developments
– As Invest or Take: A Venture Capitalist's Ethical Dilemma HBR case study mentions - Entrepreneur's Carrick 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.
No frontier risks strategy
– After analyzing the HBR case study Invest or Take: A Venture Capitalist's Ethical Dilemma, 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.
Lack of clear differentiation of Entrepreneur's Carrick products
– To increase the profitability and margins on the products, Entrepreneur's Carrick needs to provide more differentiated products than what it is currently offering in the marketplace.
Products dominated business model
– Even though Entrepreneur's Carrick 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 - Invest or Take: A Venture Capitalist's Ethical Dilemma should strive to include more intangible value offerings along with its core products and services.
Opportunities Invest or Take: A Venture Capitalist's Ethical Dilemma | 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 Invest or Take: A Venture Capitalist's Ethical Dilemma are -
Manufacturing automation
– Entrepreneur's Carrick 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Entrepreneur's Carrick 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, Invest or Take: A Venture Capitalist's Ethical Dilemma, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Developing new processes and practices
– Entrepreneur's Carrick 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.
Using analytics as competitive advantage
– Entrepreneur's Carrick 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 Invest or Take: A Venture Capitalist's Ethical Dilemma - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Entrepreneur's Carrick to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Loyalty marketing
– Entrepreneur's Carrick 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 Entrepreneur's Carrick 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 Entrepreneur's Carrick to hire the very best people irrespective of their geographical location.
Leveraging digital technologies
– Entrepreneur's Carrick 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.
Learning at scale
– Online learning technologies has now opened space for Entrepreneur's Carrick 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. Entrepreneur's Carrick can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Building a culture of innovation
– managers at Entrepreneur's Carrick 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.
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 Entrepreneur's Carrick 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.
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. Entrepreneur's Carrick 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. Entrepreneur's Carrick 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.
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. Entrepreneur's Carrick can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats Invest or Take: A Venture Capitalist's Ethical Dilemma External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Invest or Take: A Venture Capitalist's Ethical Dilemma are -
Regulatory challenges
– Entrepreneur's Carrick 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.
Technology acceleration in Forth Industrial Revolution
– Entrepreneur's Carrick has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Entrepreneur's Carrick 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.
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 Entrepreneur's Carrick.
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. Entrepreneur's Carrick needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Invest or Take: A Venture Capitalist's Ethical Dilemma, Entrepreneur's Carrick 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 .
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Entrepreneur's Carrick 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
– Entrepreneur's Carrick 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 Entrepreneur's Carrick in the Leadership & Managing People sector and impact the bottomline of the organization.
Shortening product life cycle
– it is one of the major threat that Entrepreneur's Carrick is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Entrepreneur's Carrick can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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
– Entrepreneur's Carrick 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. Entrepreneur's Carrick can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Weighted SWOT Analysis of Invest or Take: A Venture Capitalist's Ethical Dilemma 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 Invest or Take: A Venture Capitalist's Ethical Dilemma 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 Invest or Take: A Venture Capitalist's Ethical Dilemma 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 Invest or Take: A Venture Capitalist's Ethical Dilemma 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 Invest or Take: A Venture Capitalist's Ethical Dilemma 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 Entrepreneur's Carrick needs to make to build a sustainable competitive advantage.