International Strategic Management
Assessment task details and instructions
You must structure your report in the same order as the weighted assignment tasks set out below.
Word count
The word count for the report is 2000 words; NB Task 1 is quantitative and therefore not included in the word count.
The word count also excludes the following:
– cover page
– contents page
– references
– tables
– diagrams
– appendices
Abstracts / executive summaries are not required and will not be marked if included.
BACKGROUND
The planet is becoming more urban. By 2030, more than five billion people — about 60 percent of the world population — will live in cities.
We are also becoming more mobile and more connected. New technologies and business models are pushing aside the privately-owned automobile and other less efficient modes of transportation.
Whether from autonomous vehicles, the electrification of transportation, shared networks of cars, scooters, and bicycles, or the advent of 5G wireless, the world of mobility is changing almost daily.
Nowhere will that transformation be felt more acutely in the coming decades than in the world’s major cities where increased urban density and congestion make the tasks of creating and maintaining urban transport systems ever more complex.
This is why developing and improving urban mobility is a top priority of cities around the globe. If a city cannot move its people, goods, and data efficiently, it is difficult to see how it thrives.
Three broad technological trends will be primarily responsible for reshaping urban mobility in every city — digitization, automation, and electrification. The sharing (or collaborative) economy, a fourth trend, has led to new business models in which the mobility service provided is more important than its ownership…
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SEAT, S.A. is a Spanish automobile manufacturer with its head office in Martorell (near Barcelona), Spain. The firm has been a wholly-owned subsidiary of Volkswagen Group since 1986.
The firm is strategically repositioning itself from a vehicle manufacturer to a provider of shared mobility services (i.e. where users pay for transportation only when they need it, rather than owning a personal vehicle that is not used most of the time), especially in increasingly crowded urban areas. As stated by Luca De Meo, the firm’s Chairman:
“We are convinced that vehicles will become the second largest connected platform after the mobile phone and we will have the chance to integrate them into a rich ecosystem. This transformation forces us to innovate and move beyond the scope of being just a carmaker, stretching our value chain towards new mobility services, platforms and data businesses”.
As part of this repositioning, SEAT has identified ‘compact urban mobility’ (i.e. short commutes less than 10 kilometres within the city environment, using a small vehicle) as a core area for strategic development.
The firm unveiled its ‘Minim?’ concept vehicle at the 2019 Mobile World Congress to demonstrate SEAT’s vision of the ‘compact urban mobility’ of tomorrow.
Integrating the fields of electrification, connectivity and shared mobility the ‘Minim?’ is a 2-passenger quadricycle primarily intended for business-to-consumer free-floating carsharing providers* that has been designed to:
• have a considerably smaller ecological footprint (3.1 square metres) than a normal car (7.2 square metres) while providing safe, agile travel and easy parking
• release zero emissions due to its all-electric powertrain
• reduce the operating costs of carsharing providers by 50%, as the integrated battery-swap system means the vehicle rarely needs to be taken to a recharging point
• provide a convenient and smooth digital user experience for users based on hyperconnectivity with built-in 5-G technology
• allow the vehicle – in the future and subject to further development of autonomous technologies – to pick up the user when requested, thereby solving one of the main carsharing user pain points.
The ‘Minim?’ will go into production in June 2023 (delayed from 2022 due to the global pandemic), leaving the firm with only 12 months to decide which city from across the globe will be most attractive for the product launch.
SEAT’s international strategy team have already undertaken some initial desktop research and have identified Manchester (UK) and Melbourne (Australia) as potentially attractive markets for the product launch of the ‘Minim?’.
As an external consultant, you have been commissioned by the team to research and evaluate these 2 potential markets and their wider macroenvironments in greater detail.
* Two of the main types of business-to-consumer car-sharing models are:
Round-trip Station-based carsharing – the user only has the choice of a round trip, picking the car up at Station A and returning it to Station A when they are finished. Those who plan trips ahead of time or are looking for a car at a specific time would benefit from these services.
Free-floating carsharing (e.g. car2go, Gig or DriveNow) – the user can see which cars are available within a set operating area on a mobile app and choose the one closest to them. Once the user is finished using the car, they can drop off the car at any location within the set operating area, saving time and avoiding unnecessary trips. Those who are spontaneous and decide last-minute that they need a car would benefit from these services. SEAT intends to sell its ‘Minim?’ vehicle to business-to-consumer free-floating carsharing providers.
NB the differences between car-sharing, ride-sharing and ride-hailing:
Car-sharing = ‘I rent a car to drive now and park it when I’m finished; someone else will rent the same car later and drive it’
Ride-sharing = a customer (rider) shares a vehicle with other riders. It is not personal transportation, as the vehicle is shared with other riders and will make stops to pick up other riders
Ride-hailing = when a rider “hails” or hires a personal driver to take them exactly where they need to go. The vehicle is not shared with any other riders, nor does it make several stops along a route. The ride is booked and paid for through a smartphone app with a transportation network company (TNC) such as Uber
TASKS
Overview of assignment tasks:
Task Nature of Task Weighting Word Count
1 Comparative evaluation of 2 markets + identification of most attractive market to enter N/A – Quantitative
2 Critical evaluation of implications of most relevant macro-environmental and urban mobility factors in chosen market for SEAT 2000
Task requirements:
1. In order to identify which city is the most potentially attractive destination for the launch of the SEAT ‘Minim?’, you are required to undertake a comparative evaluation of what you believe to be the most relevant country-level (i.e. macro-environmental) factors and city-level (socio-economic and mobility capability) factors of Manchester and Melbourne.
• Task 1 must be presented in table format and must be no more than 8 pages in length.
• Your tutors will provide you with a template for the tables for Task 1; you must use this template for Task 1.
• Country-level macro-environmental and city-level socio-economic data should be recent, quantitative and obtained from appropriate sources (see example useful links below).
• City-level mobility capability data should be recent, quantitative and obtained from appropriate sources (e.g. the 2020 Deloitte City Mobility Index, which assesses the health of cities’ mobility networks and their readiness to embrace the future of mobility in the coming decades; see example useful links below).
• A weighting and scoring system should be used for each factor for each country / city to show whether each factor is more or less attractive for the company. These scores should then be totalled for each country / city in order to arrive at a score of overall attractiveness for each country / city.
• Refer to the Assignment Task 1 Briefing slides and Task 1 guidance document when preparing this task.
– Worth 40% of the overall mark
– Not included in the word count
2. Having identified the most attractive city for the product launch of the SEAT ‘Minim?’ in Task 1, critically evaluate those country-level (i.e. macro-environmental) factors and city-level (socio-economic and mobility capability) factors for this city that you believe to be of most relevance to SEAT – whether in terms of opportunities or threats.
• You must explicitly discuss the implications of these key country-level (i.e. macro-environmental) factors and city-level (socio-economic and mobility capability) factors for SEAT.
• No reference is to be made to the city that you found to be least attractive in Task 1.
– Worth 60% of the overall mark
– 2000 words
USEFUL LINKS
For Assignments 1 & 2
The below links are provided to help you source data and information for several of the assignment tasks but you are expected to undertake additional independent research to address the tasks.
Sustainable Mobility in Cities – background information
The following provides a very useful overview of the context for carsharing in cities (increasing urbanization and digitization giving rise to the collaborative economy; carsharing disrupting existing transport choices; different types of business models and the need to customise these to the specific contexts of different cities; key things for automakers and carsharing providers to consider):
• EY (2015). Urban Mobility Redefined: Sharing is the New Buying –https://www.autonews.com/assets/pdf/ey/ey-urban-mobility-redefined.pdf
• There is also a short video that accompanies this report – https://www.youtube.com/watch?v=p1MBP2dSOD8
Carsharing Sector – background information
The following are a series of short articles which provide a useful overview of the carsharing industry at a broad level:
• The Current State of Carsharing: An Industry Overview (2021) – https://inversmobility.medium.com/the-current-state-of-carsharing-an-industry-overview-7b4154e49a63
• Heineke, K., Kloss, B., Moller, T. & Wiemuth, C. (2021). Shared Mobility: Where It Stands, Where It’s Headed – https://www.mckinsey.com/industries/automotive-and-assembly/our-insights/shared-mobility-where-it-stands-where-its-headed
• Heinecke, A. (2018). Alternative Mobility Modes: getting from A to B without an own vehicle. How to differentiate between Vehicle & Mobility on Demand –
https://www.linkedin.com/pulse/future-mobility-alternative-modes-getting-from-b-without-heinecke/
• Heinecke, A. (2018). The value chain of new mobility services; Impacting traditional OEMs & opening the playground to new competitors –
https://www.linkedin.com/pulse/future-mobility-value-chain-new-services-impacting-oems-heinecke/
• Simoudis, E. (2017). A New Value Chain For On-Demand Shared Mobility –
• Why OEMs Will Dominate the Global Carsharing Market (2016) –
SEAT & the Minimó – background information
• SEAT Minimó: A vision of the future of urban mobility (25/02/2019) –
https://www.seat-mediacenter.com/newspage/allnews/company/2019/SEAT-Minimo-A-vision-of-the-future-of-urban-mobility.html
• SEAT challenges Renault Twizy with Minimo concept (25/02/2019) –
https://europe.autonews.com/geneva-auto-show/seat-challenges-renault-twizy-minimo-concept
• The Seat Minimo Could Finally Revolutionize Carsharing Services And Further Kill The Car As We Know It (01/03/2019) –
https://www.topspeed.com/cars/seat/2019-seat-minimo-concept-ar184691.html
• New SEAT Minimo concept previews Renault Twizy rival for 2021 (05/03/2019) – https://www.autoexpress.co.uk/seat/105957/new-seat-minimo-concept-previews-renault-twizy-rival-for-2021
• SEAT Annual Report (2021) – https://www.seat.com/content/dam/public/seat-website/company/annual-report/historical-reports/pdf/others-annual-report-2021-march-2022.pdf
• SEAT Annual Report (2020) – https://www.seat.com/content/dam/public/seat-website/company/annual-report/overview/pdf/others-annual-report-2020-march-2021.pdf
• SEAT Annual Report (2019) – https://www.seat.co.uk/content/dam/public/seat-website/company/annual-report/overview/pdf/others-annual_report_2019_full-NA-NA-NA-march-2020.pdf
Country-Level Macro-environmental Data
• A.M. Best Country Risk Report (2021) – https://www3.ambest.com/ratings/cr/crisk.aspx
• World Economic Forum Global Competitiveness Report (2019) – https://www3.weforum.org/docs/WEF_TheGlobalCompetitivenessReport2019.pdf
• Corruption Perceptions Index (2021) – https://www.transparency.org/en/cpi/2021
• Doing Business (2020) – https://www.doingbusiness.org/en/reports/global-reports/doing-business-2020
• Index of Economic Freedom (2021) – https://www.heritage.org/index/
• The Network Readiness Index (2021) – https://networkreadinessindex.org/
• Global Innovation Index (2021) – https://www.wipo.int/global_innovation_index/en/2021/
Metropolitan-Level Socio-Economic Data
• OECD Metropolitan Area Statistics – https://stats.oecd.org/Index.aspx?DataSetCode=CITIES (latest year available – 2020)
City-Level Urban Mobility Indices
• Deloitte City Mobility Index (2020) – https://www2.deloitte.com/us/en/insights/focus/future-of-mobility/deloitte-urban-mobility-index-for-cities.html?id=us:2em:3pa:future-of-mobility:eng:di:090920
• Manchester Deloitte City Mobility Index (2020) – https://www2.deloitte.com/content/dam/insights/us/articles/4331_Deloitte-City-Mobility-Index/Manchester_GlobalCityMobility_WEB.pdf
• Melbourne Deloitte City Mobility Index (2020) – https://www2.deloitte.com/content/dam/insights/us/articles/4331_Deloitte-City-Mobility-Index/Melbourne_GlobalCityMobility_WEB.pdf
Referencing your assessments properly is a requirement. For all assignments, you must use the APA 7th (Harvard) style.
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