Case Study Description of More Vino Ltd. - Expansion Proposal
This is part of the subset of Ivey cases and technical notes written for Introductory-Level courses.A shareholder and silent partner in More Vino Ltd. reviews a request for TT$600,000 in additional funding to finance a renovation for the company. He had initially invested a major portion of the start-up capital. Since then, More Vino has grown in popularity and is now considered the most popular spot for food, drink and entertainment. The shareholder believes that More Vino is a good investment, but he is uncertain whether lending additional capital at this time is the best solution for the business.
Swot Analysis of "More Vino Ltd. - Expansion Proposal" written by Elizabeth M.A. Grasby, Julie Harvey includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Vino Shareholder facing as an external strategic factors. Some of the topics covered in More Vino Ltd. - Expansion Proposal case study are - Strategic Management Strategies, Financial analysis, Growth strategy and Finance & Accounting.
Some of the macro environment factors that can be used to understand the More Vino Ltd. - Expansion Proposal casestudy better are - – competitive advantages are harder to sustain because of technology dispersion, geopolitical disruptions, increasing energy prices, increasing commodity prices, customer relationship management is fast transforming because of increasing concerns over data privacy, digital marketing is dominated by two big players Facebook and Google, challanges to central banks by blockchain based private currencies,
cloud computing is disrupting traditional business models, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of More Vino Ltd. - Expansion Proposal
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in More Vino Ltd. - Expansion Proposal case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Vino Shareholder, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Vino Shareholder 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 More Vino Ltd. - Expansion Proposal can be done for the following purposes –
1. Strategic planning using facts provided in More Vino Ltd. - Expansion Proposal case study
2. Improving business portfolio management of Vino Shareholder
3. Assessing feasibility of the new initiative in Finance & Accounting field.
4. Making a Finance & Accounting topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Vino Shareholder
Strengths More Vino Ltd. - Expansion Proposal | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Vino Shareholder in More Vino Ltd. - Expansion Proposal Harvard Business Review case study are -
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Vino Shareholder digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Vino Shareholder 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.
Learning organization
- Vino Shareholder 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 Vino Shareholder is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in More Vino Ltd. - Expansion Proposal Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Effective Research and Development (R&D)
– Vino Shareholder 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 More Vino Ltd. - Expansion Proposal - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to lead change in Finance & Accounting field
– Vino Shareholder 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 Vino Shareholder in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Ability to recruit top talent
– Vino Shareholder is one of the leading recruiters in the industry. Managers in the More Vino Ltd. - Expansion Proposal are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Operational resilience
– The operational resilience strategy in the More Vino Ltd. - Expansion Proposal Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Successful track record of launching new products
– Vino Shareholder has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Vino Shareholder has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Organizational Resilience of Vino Shareholder
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Vino Shareholder does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High switching costs
– The high switching costs that Vino Shareholder has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Highly skilled collaborators
– Vino Shareholder 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 More Vino Ltd. - Expansion Proposal HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High brand equity
– Vino Shareholder has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Vino Shareholder to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in Finance & Accounting industry
– More Vino Ltd. - Expansion Proposal firm has clearly differentiated products in the market place. This has enabled Vino Shareholder to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Vino Shareholder to invest into research and development (R&D) and innovation.
Weaknesses More Vino Ltd. - Expansion Proposal | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of More Vino Ltd. - Expansion Proposal are -
High bargaining power of channel partners
– Because of the regulatory requirements, Elizabeth M.A. Grasby, Julie Harvey suggests that, Vino Shareholder 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Vino Shareholder is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study More Vino Ltd. - Expansion Proposal can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Low market penetration in new markets
– Outside its home market of Vino Shareholder, firm in the HBR case study More Vino Ltd. - Expansion Proposal needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Products dominated business model
– Even though Vino Shareholder has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - More Vino Ltd. - Expansion Proposal should strive to include more intangible value offerings along with its core products and services.
High cash cycle compare to competitors
Vino Shareholder has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Capital Spending Reduction
– Even during the low interest decade, Vino Shareholder 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.
Increasing silos among functional specialists
– The organizational structure of Vino Shareholder is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Vino Shareholder needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Vino Shareholder to focus more on services rather than just following the product oriented approach.
Slow decision making process
– As mentioned earlier in the report, Vino Shareholder 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. Vino Shareholder 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.
Slow to strategic competitive environment developments
– As More Vino Ltd. - Expansion Proposal HBR case study mentions - Vino Shareholder takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Workers concerns about automation
– As automation is fast increasing in the segment, Vino Shareholder 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study More Vino Ltd. - Expansion Proposal, is just above the industry average. Vino Shareholder needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Opportunities More Vino Ltd. - Expansion Proposal | 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 More Vino Ltd. - Expansion Proposal are -
Buying journey improvements
– Vino Shareholder can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. More Vino Ltd. - Expansion Proposal suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Vino Shareholder can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, More Vino Ltd. - Expansion Proposal, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Finance & Accounting industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Vino Shareholder 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. Vino Shareholder 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Finance & Accounting industry, but it has also influenced the consumer preferences. Vino Shareholder can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Learning at scale
– Online learning technologies has now opened space for Vino Shareholder 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Vino Shareholder is facing challenges because of the dominance of functional experts in the organization. More Vino Ltd. - Expansion Proposal 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.
Developing new processes and practices
– Vino Shareholder can develop new processes and procedures in Finance & Accounting 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Vino Shareholder 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 Vino Shareholder to hire the very best people irrespective of their geographical location.
Building a culture of innovation
– managers at Vino Shareholder 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 Finance & Accounting segment.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Vino Shareholder can use these opportunities to build new business models that can help the communities that Vino Shareholder operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Manufacturing automation
– Vino Shareholder can use the latest technology developments to improve its manufacturing and designing process in Finance & Accounting 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.
Creating value in data economy
– The success of analytics program of Vino Shareholder has opened avenues for new revenue streams for the organization in the industry. This can help Vino Shareholder to build a more holistic ecosystem as suggested in the More Vino Ltd. - Expansion Proposal case study. Vino Shareholder can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Vino Shareholder can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats More Vino Ltd. - Expansion Proposal External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study More Vino Ltd. - Expansion Proposal are -
Regulatory challenges
– Vino Shareholder 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 Finance & Accounting industry regulations.
Environmental challenges
– Vino Shareholder 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. Vino Shareholder can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Vino Shareholder in the Finance & Accounting industry. The Finance & Accounting industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
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.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Vino Shareholder needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
Stagnating economy with rate increase
– Vino Shareholder can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Consumer confidence and its impact on Vino Shareholder 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.
High dependence on third party suppliers
– Vino Shareholder 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.
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 Vino Shareholder business can come under increasing regulations regarding data privacy, data security, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study More Vino Ltd. - Expansion Proposal, Vino Shareholder may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Finance & Accounting .
Technology acceleration in Forth Industrial Revolution
– Vino Shareholder has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Vino Shareholder needs to keep up with the evolution of technology in the Finance & Accounting 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.
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.
Shortening product life cycle
– it is one of the major threat that Vino Shareholder is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of More Vino Ltd. - Expansion Proposal 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 More Vino Ltd. - Expansion Proposal 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 More Vino Ltd. - Expansion Proposal 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 More Vino Ltd. - Expansion Proposal 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 More Vino Ltd. - Expansion Proposal 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 Vino Shareholder needs to make to build a sustainable competitive advantage.