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Case Study Analysis- $100 Laptop by John Quelch - Essay Example

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CASE STUDY ANALYSIS Introduction 3 Apparent Issue 3 Real Issue 3 Relevant Facts 4 SWOT Analysis 5 Options 11 Implications 11 Recommendations 12 Evaluation 12 References 13 Introduction Professor Nicholas Negroponte launched a $ 100 Laptop in 2003 with the Media Lab of MIT…
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Download file to see previous pages Apparent Issue Despite the high PC adoption rate in certain regions OLPC is finding difficulty in convincing the respective governments to invest heavily in his project. He needed investment in one million at a time by a nation in Laptop and including all expenditures the price tag could go to $ 200 million to $ 250 million. Negroponte decided not to venture into production until he has firm commitments from governments to buy at least five million machines outside USA. Competitors were increasingly lowering their product prices with no such restriction. Real Issue The real issue was the shift in technology. The emerging markets were likely to be wire-less centric rather than PC- centric. Hence it was more viable to distribute internet enabled cell phones to children for education rather than trying to built and distribute Wi-FI enabled mesh networks with donated or subsidized Laptops as was being done by OLPC. The problem was of disruptive innovation and market evolution. Relevant Facts OLPC is facing many different challenges and varied situations both internally and in the external environment. In the table below is the list of the few most relevant and important facts concerning OLPC. FACTS EVALUATION FINACIAL In 2006 AMD, Google, Red Hat, News Corp. gave at least $ 29 million to fund the project and pledged additional money for the future. + OLPC needed an order of one million laptops at a time to start its production. - MARKETING The $ 100 Laptop proved to be a misnomer. The initial cost was close to $ 150 per machine. ? OLPC find it difficult to sell the idea. The poor underdeveloped countries that are still striving for basic necessities of life find it difficult to invest such huge amount on laptops instead of basic education. _ COMPETITORS Competitors were multiplying in number both nationally and internationally and well renowned business oriented companies were giving tough competition by continuously offering their low priced products. _ Emerging technologies such as internet enabled cell phones were cheaper and have more consumer acceptance in poor countries. ? ORGANIZATION Intel started working together with OLPC in July 2007 and started mass production + Due to request of OLPC for Intel to stop marketing its low cost laptops Intel terminated the partnership with OLPC in January 2008. ? TECHNOLOGY Design engineers of OLPC not only were successful in reducing cost through innovative technology but also solved the problem of lack of electricity with hand crank. + Enhanced Wi-Fi range created wireless mesh to enable out of range machines to connect to internet. + SWOT Analysis SWOT analysis is the most effective tool that provides the framework for the analysis of the business environment. It is considered more effective because in a way, it combines the Porters five forces with the PEST analysis. It requires careful prioritization of strong opportunities and threats. Wrong selection may lead to weaker opportunities and threats coming in the analysis. SWOT analysis provides both internal and external analysis and provides a critical analysis of strengths, weaknesses, opportunities and threats. It helps organizations in developing its strategies like SO that emphasizes on utilizing strengths to capture the opportunities. WT strategy focuses on minimizing weaknesses and threats. ST strategy focuses ...Download file to see next pagesRead More
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