Business Case Internal Analysis: WeWork

Case Analysis: WeWork
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Case Analysis: WeWork
Founded in 2010, WeWork is a company that prides itself in being diversified. The company started as a commercial leasing company. However, as indicated by Hoffman (2019), unlike other companies, WeWork operated differently. The company “would take an entire floor or two of an office building, divide the floor into smaller spaces and charge monthly membership to those who didn’t mind sharing the space.” Aside from providing space, WeWork also provided on-site amenities and this helped it grow and spread to 32 countries by 2018. However, WeWork’s growth did not stop there. The company continues to diversify and grow with each passing day. Hoffman notes that the company’s “expansion beyond corporate real estate reflected WeWork’s desire to be as much a lifestyle as an office space company.” However, with the said growth, comes the need for capital which WeWork seemed to have in plenty. Apparently, WeWork had a plethora of investors who made sure that the company’s expansion efforts continued. However, and as is always the case, where the money is coming from matters as much as what it is helping to accomplish. Soon, WeWork found itself in a conundrum as it was forced to either denounce its investors or face the uncertain future that lay ahead of the company.
The main issue WeWork is facing is having financial ties with Saudi Arabia. WeWork is not directly funded by Saudi Arabia but by SoftBank’s Vision Fund. SoftBank is a “Japanese multinational telecom and internet firm.” The firm started Vision Fund which is a “venture capital investment fund targeting technology companies.” One major contributor to this fund is Saudi Arabia which channeled billions of dollars through its Saudi Arabia’s Public Investment Fund. Saudi Arabia’s record or character is not saintly and the kingdom has been involved in a lot of criminal activities. The kingdom has been accused of acting against the doctrines of human rights and just recently, its involvement in the death of Jamal Khashoggi. Khashoggi was a journalist whose rhetoric against Saudi Arabia’s leadership and conduct in Yemen led to his death. The Crown Prince bin Salman is said to be at the center of Khashoggi’s death. With such a history, it is indeed questionable that WeWork would take money from investors who openly violate the rights of other people.
Aside from the above, WeWork’s actions of receiving money from SoftBank’s Vision Fund can be called into question because of its commitment to carbon neutrality. It is hypocritical for WeWork to commit to carbon neutrality and then take money from Saudi Arabia which possesses the largest crude oil reserves globally. As more crude oil is drilled, the world continues to dispose of more carbon particles in the atmosphere. So, it makes little sense for WeWork to commit to carbon neutrality and yet continue to take money from an investor that until recently has been the largest producer of crude oil.
Internal Analysis
Internal factors are aspects of the company that impact the company from the inside. Below is an explication of the internal factors that could impact the success of WeWork.
* Innovation – a company has to evolve and grow. Without strategies to grow and evolve, a company can easily die or find itself last against its competitors. For WeWork, innovation appears to be at its best. Since its inception, the company has managed to diversify its operations and this has helped it to grow beyond imaginable levels. Factions of the company include WeLive, WeGrow, Rise by We, Meetup, Flatiron School, and WeMRKT. These are all innovative ideas (apart from Meetup and Flatiron School which are acquisitions) that have helped the company expand its wings and venture into other aspects or areas of business. A business cannot grow if it does not embrace a culture of growth. WeWork appears to be embracing a culture of growth and is working towards actualizing that dream.
* Leadership – WeWork’s leadership forms another internal factor that could impact the day to day running of the company. Without visionary leadership, the company cannot survive. Every company needs leadership that motivates, inspires, and challenges its employees to grow together with the company. However, this aspect of leaders can be irrelevant if an organization lacks an efficient organizational culture. For WeWork, the leadership appears to be visionary and with its eyes set on growth and expansion. These are great qualities within the leadership. However, the leadership also appears to be flawed because of not foreseeing the problem at hand. Leadership has to be cautious as well and know when to steer the company in the right direction. For WeWork, the leadership has indeed failed to rise to the occasion and avoid instances that could infringe on the company’s reputation.
* Values – the values of an organization are an i...