Box: Building the Next Generation Enterprise Software Company SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Box: Building the Next Generation Enterprise Software Company
CEO Aaron Levie co-founded Box as a student at USC in 2004. Less than 10 years later, Box had become one of the fastest growing enterprise software companies in Silicon Valley, serving more than 180,000 businesses including marquee customers such as Procter and Gamble, Panasonic, and Avaya. Despite this success, Levie was concerned about the future. He and his leadership team would need to overcome significant hurdles to turn Box into one of the next great enterprise software companies. This case explores how Levie planned to evolve Box from online storage to a data platform in the cloud. It follows the company's attempt to shift from collaborative sharing of information to becoming a platform for accessing critical data. Issues covered include: managing competitive threats from large, well-funded companies such as Microsoft and Citrix, delivering enterprise-class solutions with consumer-grade ease-of-use, and maintaining Box's distinctive and fun culture as the company grew and added more disciplined business processes.
Authors :: Robert Burgelman, Robert Siegel, Shalie Gaskill
Swot Analysis of "Box: Building the Next Generation Enterprise Software Company" written by Robert Burgelman, Robert Siegel, Shalie Gaskill includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Box Levie facing as an external strategic factors. Some of the topics covered in Box: Building the Next Generation Enterprise Software Company case study are - Strategic Management Strategies, and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Box: Building the Next Generation Enterprise Software Company casestudy better are - – increasing commodity prices, increasing inequality as vast percentage of new income is going to the top 1%, supply chains are disrupted by pandemic , increasing household debt because of falling income levels, increasing transportation and logistics costs, geopolitical disruptions, increasing government debt because of Covid-19 spendings,
talent flight as more people leaving formal jobs, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of Box: Building the Next Generation Enterprise Software Company
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Box: Building the Next Generation Enterprise Software Company case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Box Levie, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Box Levie 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 Box: Building the Next Generation Enterprise Software Company can be done for the following purposes –
1. Strategic planning using facts provided in Box: Building the Next Generation Enterprise Software Company case study
2. Improving business portfolio management of Box Levie
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 Box Levie
Strengths Box: Building the Next Generation Enterprise Software Company | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Box Levie in Box: Building the Next Generation Enterprise Software Company Harvard Business Review case study are -
Superior customer experience
– The customer experience strategy of Box Levie in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to recruit top talent
– Box Levie is one of the leading recruiters in the industry. Managers in the Box: Building the Next Generation Enterprise Software Company are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Effective Research and Development (R&D)
– Box Levie 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 Box: Building the Next Generation Enterprise Software Company - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Low bargaining power of suppliers
– Suppliers of Box Levie in the sector have low bargaining power. Box: Building the Next Generation Enterprise Software Company has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Box Levie to manage not only supply disruptions but also source products at highly competitive prices.
Organizational Resilience of Box Levie
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Box Levie does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to lead change in Leadership & Managing People field
– Box Levie 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 Box Levie in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Highly skilled collaborators
– Box Levie 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 Box: Building the Next Generation Enterprise Software Company HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Analytics focus
– Box Levie 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 Robert Burgelman, Robert Siegel, Shalie Gaskill 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.
High switching costs
– The high switching costs that Box Levie 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.
Cross disciplinary teams
– Horizontal connected teams at the Box Levie 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.
Learning organization
- Box Levie 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 Box Levie is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Box: Building the Next Generation Enterprise Software Company Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Strong track record of project management
– Box Levie is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses Box: Building the Next Generation Enterprise Software Company | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Box: Building the Next Generation Enterprise Software Company are -
Lack of clear differentiation of Box Levie products
– To increase the profitability and margins on the products, Box Levie needs to provide more differentiated products than what it is currently offering in the marketplace.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Box: Building the Next Generation Enterprise Software Company, is just above the industry average. Box Levie 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, Box Levie 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Box: Building the Next Generation Enterprise Software Company HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Box Levie has relatively successful track record of launching new products.
Need for greater diversity
– Box Levie 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, Box Levie 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 Box Levie 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.
Increasing silos among functional specialists
– The organizational structure of Box Levie is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Box Levie needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Box Levie to focus more on services rather than just following the product oriented approach.
Products dominated business model
– Even though Box Levie 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 - Box: Building the Next Generation Enterprise Software Company should strive to include more intangible value offerings along with its core products and services.
Slow decision making process
– As mentioned earlier in the report, Box Levie 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. Box Levie 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.
Capital Spending Reduction
– Even during the low interest decade, Box Levie 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.
Opportunities Box: Building the Next Generation Enterprise Software Company | 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 Box: Building the Next Generation Enterprise Software Company are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Box Levie can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Box Levie 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 Box Levie to hire the very best people irrespective of their geographical location.
Loyalty marketing
– Box Levie 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.
Buying journey improvements
– Box Levie can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Box: Building the Next Generation Enterprise Software Company 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, Box Levie can use these opportunities to build new business models that can help the communities that Box Levie operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Low interest rates
– Even though inflation is raising its head in most developed economies, Box Levie 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.
Learning at scale
– Online learning technologies has now opened space for Box Levie 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.
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 Box Levie in the consumer business. Now Box Levie can target international markets with far fewer capital restrictions requirements than the existing system.
Developing new processes and practices
– Box Levie 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.
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 Box Levie 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.
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. Box Levie can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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. Box Levie can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Creating value in data economy
– The success of analytics program of Box Levie has opened avenues for new revenue streams for the organization in the industry. This can help Box Levie to build a more holistic ecosystem as suggested in the Box: Building the Next Generation Enterprise Software Company case study. Box Levie can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats Box: Building the Next Generation Enterprise Software Company External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Box: Building the Next Generation Enterprise Software Company are -
Increasing wage structure of Box Levie
– 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 Box Levie.
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. Box Levie can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Environmental challenges
– Box Levie 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. Box Levie can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Stagnating economy with rate increase
– Box Levie 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.
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 Box Levie in the Leadership & Managing People sector and impact the bottomline of the organization.
Consumer confidence and its impact on Box Levie 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Box Levie with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Box: Building the Next Generation Enterprise Software Company, Box Levie 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 international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Box Levie 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 Box: Building the Next Generation Enterprise Software Company .
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.
Technology acceleration in Forth Industrial Revolution
– Box Levie has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Box Levie 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
– Box Levie 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.
High dependence on third party suppliers
– Box Levie 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.
Weighted SWOT Analysis of Box: Building the Next Generation Enterprise Software Company 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 Box: Building the Next Generation Enterprise Software Company 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 Box: Building the Next Generation Enterprise Software Company 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 Box: Building the Next Generation Enterprise Software Company 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 Box: Building the Next Generation Enterprise Software Company 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 Box Levie needs to make to build a sustainable competitive advantage.
