WD-40 Company: The Squeak, Smell, and Dirt Business (B) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Organizational Development
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of WD-40 Company: The Squeak, Smell, and Dirt Business (B)
In the fall of 1999 Garry Ridge, the newly appointed CEO of WD-40 Company, wanted to rejuvenate the company and stimulate its employees to look beyond the firm's relatively narrow focus of the last 43 years. The very nature of WD-40 Company's success in capturing the market had created its own limited growth opportunities. The A case describes the company's one-product business success, and Ridge's background. The B case reveals some of the challenges Ridge faced in implementing change. The B case tells how the new CEO helped WD-40 company achieve growth in both new products and markets through related acquisitions. Despite these purchases, though, the company's earnings failed to climb in the years between 1998 and 2001. Ridge concluded that he needed to do more than just buy more companies, so he framed a model of strong leadership and "learning theory" that he thought would enable the company outsmart its competitors. He built a framework that was demanding, yet forgiving, when individuals fell short. Ridge held employees responsible for their results, but he encouraged everyone to acknowledge mistakes and learn from them. The company's financial results suggest success for his leadership model. This case set lends instructors a valuable tool to conduct conversations in the classroom about leadership and leading strategic change.
Authors :: Gerry Yemen, James G. Clawson, Marcia Conner
Swot Analysis of "WD-40 Company: The Squeak, Smell, and Dirt Business (B)" written by Gerry Yemen, James G. Clawson, Marcia Conner includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Wd Ridge facing as an external strategic factors. Some of the topics covered in WD-40 Company: The Squeak, Smell, and Dirt Business (B) case study are - Strategic Management Strategies, Knowledge management, Marketing, Organizational culture and Organizational Development.
Some of the macro environment factors that can be used to understand the WD-40 Company: The Squeak, Smell, and Dirt Business (B) casestudy better are - – wage bills are increasing, there is increasing trade war between United States & China, increasing government debt because of Covid-19 spendings, customer relationship management is fast transforming because of increasing concerns over data privacy, geopolitical disruptions, digital marketing is dominated by two big players Facebook and Google, competitive advantages are harder to sustain because of technology dispersion,
there is backlash against globalization, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of WD-40 Company: The Squeak, Smell, and Dirt Business (B)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in WD-40 Company: The Squeak, Smell, and Dirt Business (B) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Wd Ridge, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Wd Ridge 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 WD-40 Company: The Squeak, Smell, and Dirt Business (B) can be done for the following purposes –
1. Strategic planning using facts provided in WD-40 Company: The Squeak, Smell, and Dirt Business (B) case study
2. Improving business portfolio management of Wd Ridge
3. Assessing feasibility of the new initiative in Organizational Development field.
4. Making a Organizational Development topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Wd Ridge
Strengths WD-40 Company: The Squeak, Smell, and Dirt Business (B) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Wd Ridge in WD-40 Company: The Squeak, Smell, and Dirt Business (B) Harvard Business Review case study are -
Operational resilience
– The operational resilience strategy in the WD-40 Company: The Squeak, Smell, and Dirt Business (B) 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.
High switching costs
– The high switching costs that Wd Ridge 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
– Wd Ridge 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 WD-40 Company: The Squeak, Smell, and Dirt Business (B) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Sustainable margins compare to other players in Organizational Development industry
– WD-40 Company: The Squeak, Smell, and Dirt Business (B) firm has clearly differentiated products in the market place. This has enabled Wd Ridge to fetch slight price premium compare to the competitors in the Organizational Development industry. The sustainable margins have also helped Wd Ridge to invest into research and development (R&D) and innovation.
Strong track record of project management
– Wd Ridge is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Effective Research and Development (R&D)
– Wd Ridge 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 WD-40 Company: The Squeak, Smell, and Dirt Business (B) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Low bargaining power of suppliers
– Suppliers of Wd Ridge in the sector have low bargaining power. WD-40 Company: The Squeak, Smell, and Dirt Business (B) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Wd Ridge to manage not only supply disruptions but also source products at highly competitive prices.
High brand equity
– Wd Ridge has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Wd Ridge to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Analytics focus
– Wd Ridge is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Gerry Yemen, James G. Clawson, Marcia Conner can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Ability to recruit top talent
– Wd Ridge is one of the leading recruiters in the industry. Managers in the WD-40 Company: The Squeak, Smell, and Dirt Business (B) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Diverse revenue streams
– Wd Ridge is present in almost all the verticals within the industry. This has provided firm in WD-40 Company: The Squeak, Smell, and Dirt Business (B) case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Superior customer experience
– The customer experience strategy of Wd Ridge in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses WD-40 Company: The Squeak, Smell, and Dirt Business (B) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of WD-40 Company: The Squeak, Smell, and Dirt Business (B) are -
Workers concerns about automation
– As automation is fast increasing in the segment, Wd Ridge 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.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Wd Ridge supply chain. Even after few cautionary changes mentioned in the HBR case study - WD-40 Company: The Squeak, Smell, and Dirt Business (B), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Wd Ridge vulnerable to further global disruptions in South East Asia.
Slow decision making process
– As mentioned earlier in the report, Wd Ridge 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. Wd Ridge 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 WD-40 Company: The Squeak, Smell, and Dirt Business (B), in the dynamic environment Wd Ridge has struggled to respond to the nimble upstart competition. Wd Ridge has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study WD-40 Company: The Squeak, Smell, and Dirt Business (B), it seems that the employees of Wd Ridge don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Wd Ridge is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study WD-40 Company: The Squeak, Smell, and Dirt Business (B) can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Interest costs
– Compare to the competition, Wd Ridge 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.
High cash cycle compare to competitors
Wd Ridge 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.
Increasing silos among functional specialists
– The organizational structure of Wd Ridge is dominated by functional specialists. It is not different from other players in the Organizational Development segment. Wd Ridge needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Wd Ridge to focus more on services rather than just following the product oriented approach.
Lack of clear differentiation of Wd Ridge products
– To increase the profitability and margins on the products, Wd Ridge needs to provide more differentiated products than what it is currently offering in the marketplace.
High operating costs
– Compare to the competitors, firm in the HBR case study WD-40 Company: The Squeak, Smell, and Dirt Business (B) 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 Wd Ridge 's lucrative customers.
Opportunities WD-40 Company: The Squeak, Smell, and Dirt Business (B) | 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 WD-40 Company: The Squeak, Smell, and Dirt Business (B) are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Wd Ridge 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 Wd Ridge to hire the very best people irrespective of their geographical location.
Manufacturing automation
– Wd Ridge can use the latest technology developments to improve its manufacturing and designing process in Organizational Development 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Organizational Development industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Wd Ridge 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. Wd Ridge 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.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Wd Ridge to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Wd Ridge 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, WD-40 Company: The Squeak, Smell, and Dirt Business (B), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Wd Ridge can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Wd Ridge in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Organizational Development segment, and it will provide faster access to the consumers.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Wd Ridge can use these opportunities to build new business models that can help the communities that Wd Ridge operates in. Secondly it can use opportunities from government spending in Organizational Development sector.
Buying journey improvements
– Wd Ridge can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. WD-40 Company: The Squeak, Smell, and Dirt Business (B) 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.
Better consumer reach
– The expansion of the 5G network will help Wd Ridge to increase its market reach. Wd Ridge will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Building a culture of innovation
– managers at Wd Ridge 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 Organizational Development segment.
Leveraging digital technologies
– Wd Ridge can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Low interest rates
– Even though inflation is raising its head in most developed economies, Wd Ridge 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.
Threats WD-40 Company: The Squeak, Smell, and Dirt Business (B) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study WD-40 Company: The Squeak, Smell, and Dirt Business (B) are -
Technology acceleration in Forth Industrial Revolution
– Wd Ridge has witnessed rapid integration of technology during Covid-19 in the Organizational Development industry. As one of the leading players in the industry, Wd Ridge needs to keep up with the evolution of technology in the Organizational Development 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Wd Ridge in the Organizational Development industry. The Organizational Development 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Wd Ridge 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 WD-40 Company: The Squeak, Smell, and Dirt Business (B) .
Easy access to finance
– Easy access to finance in Organizational Development field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Wd Ridge can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Shortening product life cycle
– it is one of the major threat that Wd Ridge is facing in Organizational Development sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, 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 WD-40 Company: The Squeak, Smell, and Dirt Business (B), Wd Ridge may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Organizational Development .
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 Wd Ridge.
High dependence on third party suppliers
– Wd Ridge 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.
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.
Consumer confidence and its impact on Wd Ridge 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.
Increasing wage structure of Wd Ridge
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Wd Ridge.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Wd Ridge with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
Weighted SWOT Analysis of WD-40 Company: The Squeak, Smell, and Dirt Business (B) 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 WD-40 Company: The Squeak, Smell, and Dirt Business (B) 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 WD-40 Company: The Squeak, Smell, and Dirt Business (B) 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 WD-40 Company: The Squeak, Smell, and Dirt Business (B) 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 WD-40 Company: The Squeak, Smell, and Dirt Business (B) 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 Wd Ridge needs to make to build a sustainable competitive advantage.
