ITC LTD.: Toward a Triple Bottom Line Performance SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of ITC LTD.: Toward a Triple Bottom Line Performance
The case describes the opportunities and challenges in the cigarette industry in India. The description suggests that there are tremendous opportunities for growth in the cigarette industry. However, there are challenges due to the health hazards associated with cigarette smoking, distortion in the tax system as applied to the cigarette industry, and restrictions on smoking placed by new legislation. Further, there are challenges in the market due to smuggling, contraband products, and other issues. The case presents ITC Limited as a dominant player in the industry with a significant dependence on tobacco and tobacco products promising to pursue the triple bottom line approach by focusing on economic, environmental and social value. There is a need for the company to decide on some directions for the future to live up to the promise of a triple bottom line approach. The case, based on the real issues faced by ITC Limited, will allow students to understand the dilemmas the firm faced in trying to meet the social demands to ban or restrict smoking. Any decision to stop producing and selling cigarettes has negative implications for the business. How does ITC Limited arrive at the right balance?
Swot Analysis of "ITC LTD.: Toward a Triple Bottom Line Performance" written by Abhoy Ojha includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Itc Cigarette facing as an external strategic factors. Some of the topics covered in ITC LTD.: Toward a Triple Bottom Line Performance case study are - Strategic Management Strategies, Decision making and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the ITC LTD.: Toward a Triple Bottom Line Performance casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, increasing inequality as vast percentage of new income is going to the top 1%, competitive advantages are harder to sustain because of technology dispersion, increasing government debt because of Covid-19 spendings, geopolitical disruptions, technology disruption, increasing transportation and logistics costs,
central banks are concerned over increasing inflation, increasing commodity prices, etc
Introduction to SWOT Analysis of ITC LTD.: Toward a Triple Bottom Line Performance
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in ITC LTD.: Toward a Triple Bottom Line Performance case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Itc Cigarette, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Itc Cigarette 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 ITC LTD.: Toward a Triple Bottom Line Performance can be done for the following purposes –
1. Strategic planning using facts provided in ITC LTD.: Toward a Triple Bottom Line Performance case study
2. Improving business portfolio management of Itc Cigarette
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 Itc Cigarette
Strengths ITC LTD.: Toward a Triple Bottom Line Performance | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Itc Cigarette in ITC LTD.: Toward a Triple Bottom Line Performance Harvard Business Review case study are -
Training and development
– Itc Cigarette has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in ITC LTD.: Toward a Triple Bottom Line Performance Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
High brand equity
– Itc Cigarette has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Itc Cigarette to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Highly skilled collaborators
– Itc Cigarette 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 ITC LTD.: Toward a Triple Bottom Line Performance HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Superior customer experience
– The customer experience strategy of Itc Cigarette in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Effective Research and Development (R&D)
– Itc Cigarette 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 ITC LTD.: Toward a Triple Bottom Line Performance - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Innovation driven organization
– Itc Cigarette is one of the most innovative firm in sector. Manager in ITC LTD.: Toward a Triple Bottom Line Performance Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Organizational Resilience of Itc Cigarette
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Itc Cigarette 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
– Itc Cigarette 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 Itc Cigarette in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Itc Cigarette digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Itc Cigarette has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Low bargaining power of suppliers
– Suppliers of Itc Cigarette in the sector have low bargaining power. ITC LTD.: Toward a Triple Bottom Line Performance has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Itc Cigarette to manage not only supply disruptions but also source products at highly competitive prices.
Sustainable margins compare to other players in Leadership & Managing People industry
– ITC LTD.: Toward a Triple Bottom Line Performance firm has clearly differentiated products in the market place. This has enabled Itc Cigarette to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Itc Cigarette to invest into research and development (R&D) and innovation.
Learning organization
- Itc Cigarette 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 Itc Cigarette is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in ITC LTD.: Toward a Triple Bottom Line Performance Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses ITC LTD.: Toward a Triple Bottom Line Performance | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of ITC LTD.: Toward a Triple Bottom Line Performance are -
Slow decision making process
– As mentioned earlier in the report, Itc Cigarette 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. Itc Cigarette 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study ITC LTD.: Toward a Triple Bottom Line Performance, in the dynamic environment Itc Cigarette has struggled to respond to the nimble upstart competition. Itc Cigarette has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High bargaining power of channel partners
– Because of the regulatory requirements, Abhoy Ojha suggests that, Itc Cigarette is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Workers concerns about automation
– As automation is fast increasing in the segment, Itc Cigarette 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.
Capital Spending Reduction
– Even during the low interest decade, Itc Cigarette 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.
Lack of clear differentiation of Itc Cigarette products
– To increase the profitability and margins on the products, Itc Cigarette needs to provide more differentiated products than what it is currently offering in the marketplace.
Interest costs
– Compare to the competition, Itc Cigarette 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.
Low market penetration in new markets
– Outside its home market of Itc Cigarette, firm in the HBR case study ITC LTD.: Toward a Triple Bottom Line Performance needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High operating costs
– Compare to the competitors, firm in the HBR case study ITC LTD.: Toward a Triple Bottom Line Performance has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Itc Cigarette 's lucrative customers.
Skills based hiring
– The stress on hiring functional specialists at Itc Cigarette 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.
Aligning sales with marketing
– It come across in the case study ITC LTD.: Toward a Triple Bottom Line Performance that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case ITC LTD.: Toward a Triple Bottom Line Performance can leverage the sales team experience to cultivate customer relationships as Itc Cigarette is planning to shift buying processes online.
Opportunities ITC LTD.: Toward a Triple Bottom Line Performance | 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 ITC LTD.: Toward a Triple Bottom Line Performance are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Itc Cigarette 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 Itc Cigarette to hire the very best people irrespective of their geographical location.
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. Itc Cigarette can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Itc Cigarette can use these opportunities to build new business models that can help the communities that Itc Cigarette 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, Itc Cigarette 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Itc Cigarette in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Leadership & Managing People segment, and it will provide faster access to the consumers.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Leadership & Managing People industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Itc Cigarette can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Itc Cigarette can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Developing new processes and practices
– Itc Cigarette 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.
Learning at scale
– Online learning technologies has now opened space for Itc Cigarette 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.
Manufacturing automation
– Itc Cigarette can use the latest technology developments to improve its manufacturing and designing process in Leadership & Managing People segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Itc Cigarette can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Itc Cigarette can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Building a culture of innovation
– managers at Itc Cigarette can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Leadership & Managing People segment.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Itc Cigarette is facing challenges because of the dominance of functional experts in the organization. ITC LTD.: Toward a Triple Bottom Line Performance case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Threats ITC LTD.: Toward a Triple Bottom Line Performance External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study ITC LTD.: Toward a Triple Bottom Line Performance are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Itc Cigarette 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 ITC LTD.: Toward a Triple Bottom Line Performance .
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Itc Cigarette business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Itc Cigarette 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.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Itc Cigarette.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Consumer confidence and its impact on Itc Cigarette 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.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Itc Cigarette will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Itc Cigarette with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Regulatory challenges
– Itc Cigarette 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.
Technology acceleration in Forth Industrial Revolution
– Itc Cigarette has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Itc Cigarette 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.
Environmental challenges
– Itc Cigarette 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. Itc Cigarette can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study ITC LTD.: Toward a Triple Bottom Line Performance, Itc Cigarette 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 .
Weighted SWOT Analysis of ITC LTD.: Toward a Triple Bottom Line Performance 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 ITC LTD.: Toward a Triple Bottom Line Performance 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 ITC LTD.: Toward a Triple Bottom Line Performance 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 ITC LTD.: Toward a Triple Bottom Line Performance 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 ITC LTD.: Toward a Triple Bottom Line Performance 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 Itc Cigarette needs to make to build a sustainable competitive advantage.