Harvard Case - Bahwan CyberTek in 2017 and Beyond
"Bahwan CyberTek in 2017 and Beyond" Harvard business case study is written by Robert Burgelman, Sheila Melvin. It deals with the challenges in the field of Service Management. The case study is 34 page(s) long and it was first published on : Oct 23, 2017
At Fern Fort University, we recommend that Bahwan CyberTek (BCT) adopt a strategic roadmap focused on service innovation, international expansion, and organizational transformation to navigate the evolving IT landscape and achieve sustainable growth beyond 2017. This roadmap should prioritize service quality, customer experience management, and employee empowerment to build a strong competitive advantage.
2. Background
Bahwan CyberTek (BCT) is an Oman-based IT services company facing a rapidly changing market. The company provides a wide range of services, including IT management, customer service, and service management, primarily focused on the Middle East and Africa region. BCT is experiencing strong growth, but faces challenges in scaling its operations, managing talent, and adapting to the increasing demand for technology-enabled services.
The case study highlights the key protagonists:
- Sheikh Abdullah Bahwan: The visionary founder and Chairman of the Bahwan Group, who emphasizes the importance of entrepreneurship and business growth.
- Dr. S.K. Mohanty: The CEO of BCT, who is responsible for driving the company's strategic direction and organizational change.
- The BCT Leadership Team: Responsible for executing the company's strategy, managing operations, and navigating the complexities of international business.
3. Analysis of the Case Study
SWOT Analysis:
Strengths:
- Strong brand reputation and established presence in the Middle East and Africa.
- Diverse service portfolio catering to various industry sectors.
- Experienced and skilled workforce with a strong understanding of the regional market.
- Strong financial performance and a commitment to business growth.
Weaknesses:
- Limited international presence compared to global competitors.
- Challenges in scaling operations and managing talent growth.
- Lack of a robust service innovation strategy to differentiate from competitors.
- Potential for cultural barriers and communication challenges in international expansion.
Opportunities:
- Growing demand for IT services across emerging markets.
- Potential for service innovation to create new value propositions and gain a competitive edge.
- Expanding into new geographic markets with untapped potential.
- Leveraging technology advancements to improve efficiency and customer experience.
Threats:
- Increased competition from global IT service providers.
- Rapid technological advancements requiring continuous adaptation and investment.
- Economic instability and political uncertainties in some target markets.
- Talent acquisition and retention challenges in a competitive market.
Porter's Five Forces Analysis:
- Threat of New Entrants: Moderate - The IT services industry is relatively easy to enter, but BCT's established brand and regional expertise provide a barrier.
- Bargaining Power of Buyers: Moderate - Customers have options, but BCT's strong relationships and customized solutions provide some leverage.
- Bargaining Power of Suppliers: Low - BCT relies on technology providers, but the market is competitive, giving them negotiating power.
- Threat of Substitute Products: High - Cloud computing and other emerging technologies offer alternatives to traditional IT services.
- Rivalry Among Existing Competitors: High - The IT services market is highly competitive, with both local and global players vying for market share.
Service Quality Gaps Model:
BCT needs to address the gaps between customer expectations and perceived service quality. This can be achieved through:
- Service Design: Developing innovative service offerings that meet evolving customer needs.
- Service Delivery: Implementing efficient and reliable service delivery processes.
- Service Communication: Clearly communicating service offerings and expectations to customers.
- Service Recovery: Implementing effective mechanisms to address service failures and build customer loyalty.
4. Recommendations
1. Service Innovation and Differentiation:
- Develop a dedicated service innovation team: This team should focus on identifying emerging trends, developing new service offerings, and exploring service-dominant logic to create value co-creation with customers.
- Invest in R&D and technology: BCT should invest in research and development to explore new technologies like artificial intelligence, cloud computing, and cybersecurity.
- Implement a customer-centric approach: BCT should prioritize customer experience management by understanding customer needs, mapping customer journeys, and leveraging customer relationship management (CRM) systems.
- Develop a robust service quality framework: This should include the SERVQUAL model, service blueprinting, and service level agreements (SLAs) to ensure consistent service delivery.
2. International Expansion:
- Target high-growth markets: BCT should focus on expanding into regions with strong economic growth and demand for IT services, such as Southeast Asia and Latin America.
- Develop a strategic partnership approach: Collaborate with local companies to gain access to new markets, leverage expertise, and build trust with customers.
- Adapt to local cultural nuances: BCT should be sensitive to cultural differences in communication, business practices, and customer expectations.
- Invest in language skills and cultural training: Equip employees with the necessary language skills and cultural understanding to effectively operate in new markets.
3. Organizational Transformation:
- Embrace a culture of innovation: Encourage employees to share ideas, experiment with new approaches, and contribute to service innovation.
- Invest in employee development and training: Provide opportunities for professional growth and skill development, particularly in areas like service design, service operations management, and service marketing mix.
- Implement a performance-based incentive system: Reward employees for exceeding performance goals, contributing to innovation, and delivering exceptional customer service.
- Promote diversity and inclusion: Create a workplace that values diverse perspectives and fosters a sense of belonging for all employees.
5. Basis of Recommendations
- Core Competencies and Consistency with Mission: The recommendations align with BCT's core competencies in IT services and its mission to provide innovative solutions to customers.
- External Customers and Internal Clients: The recommendations prioritize customer needs and employee satisfaction, fostering a positive service culture and enhancing customer loyalty.
- Competitors: The recommendations aim to differentiate BCT from competitors by focusing on service innovation, customer experience management, and international expansion.
- Attractiveness: The recommendations are expected to drive business growth, increase market share, and enhance BCT's profitability.
6. Conclusion
By implementing a strategic roadmap focused on service innovation, international expansion, and organizational transformation, BCT can position itself for sustainable growth in the evolving IT landscape. This roadmap should prioritize service quality, customer experience management, and employee empowerment to build a strong competitive advantage and solidify BCT's position as a leading IT services provider in the region and beyond.
7. Discussion
Alternatives:
- Focusing solely on cost leadership: This approach could lead to lower prices but may compromise service quality and innovation.
- Ignoring international expansion: This would limit BCT's growth potential and expose it to increased competition in its current market.
- Continuing with the current approach: This could lead to stagnation and a decline in market share as competitors innovate and expand.
Risks and Key Assumptions:
- Economic instability: The recommendations assume continued economic growth in target markets.
- Technological disruption: The recommendations assume that BCT can adapt to rapid technological advancements.
- Talent acquisition and retention: The recommendations assume that BCT can attract and retain skilled employees in a competitive market.
8. Next Steps
- Develop a detailed implementation plan: This plan should outline specific actions, timelines, and resource allocation for each recommendation.
- Establish key performance indicators (KPIs): Track progress and measure the effectiveness of the recommendations.
- Communicate the strategy to stakeholders: Ensure that all employees understand the company's vision, strategy, and their role in achieving it.
- Continuously monitor and adapt: The IT landscape is constantly changing, so BCT must be agile and responsive to new trends and opportunities.
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Case Description
Bahwan Cybertek (BCT) was an IP-enabled technology company founded in 1999 by Sheikah Hind Bahwan (Hind) and S. Durgaprasad (DP). Over the years, it had grown into a global provider of innovative software products and services and become a $242 million company with more than 2800 business and technology professionals. BCT was privately held, based in Chennai, India, with operations in the United States, the Middle East, North Africa, and Asia. BCT had worked with more than 550 customers, including Fortune 500 companies, and delivered its innovative software solutions to companies in North America, the Middle East, Africa, and Asia. In 2016, BCT created a holding company for capitalizing on the great and growing amount of IP it had created. The move seemed a natural progression for the company. "From day one we were building our IP," said Hind, "and that is why we are moving all our IP to the separate company, and that is the company that will go public or get investors: BCT Digital. It is already registered as a separate company. So now we need to restructure and move." One year later, in late 2017, BCT Digital had been established and BCT's top management was considering the strategic and organizational challenges they confronted in further developing and leading the newly-formed company.
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