Case Study Description of Hari Krishna Exports: Transforming Employees
In October 2014, Hari Krishna Exports, a US$975 million Indian diamond manufacturing company, made international news when it gave 1,268 employees a generous performance incentive of approximately US$5,700. This was part of a radical loyalty program the company had started in 2011. However, with the market dynamics of the diamond industry constantly changing, giving such performance incentives on a yearly basis would be a great challenge. Price fluctuations at every step of the process-from procurement, to polishing, to the retail markets of the diamonds-created inherent risk in the industry. Intermediaries such as diamond polishers, in comparison to miners, had less control over the upstream channels of diamond procurement, which usually comprised exploration and the mining of diamonds. What would be the ultimate engagement level of the employees? Would such performance benefits for retaining talented employees be sustainable over the long run for an export house? Malay Patel is affiliated with Indian Institute of Management Ahmedabad. Patturaja Selvaraj is affiliated with Indian Institute of Management Indore.
Swot Analysis of "Hari Krishna Exports: Transforming Employees" written by Malay Patel, Patturaja Selvaraj includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Diamond Hari facing as an external strategic factors. Some of the topics covered in Hari Krishna Exports: Transforming Employees case study are - Strategic Management Strategies, Motivating people, Organizational culture and Organizational Development.
Some of the macro environment factors that can be used to understand the Hari Krishna Exports: Transforming Employees 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%, increasing government debt because of Covid-19 spendings, technology disruption, digital marketing is dominated by two big players Facebook and Google, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing household debt because of falling income levels,
challanges to central banks by blockchain based private currencies, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of Hari Krishna Exports: Transforming Employees
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Hari Krishna Exports: Transforming Employees case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Diamond Hari, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Diamond Hari 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 Hari Krishna Exports: Transforming Employees can be done for the following purposes –
1. Strategic planning using facts provided in Hari Krishna Exports: Transforming Employees case study
2. Improving business portfolio management of Diamond Hari
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 Diamond Hari
Strengths Hari Krishna Exports: Transforming Employees | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Diamond Hari in Hari Krishna Exports: Transforming Employees Harvard Business Review case study are -
Operational resilience
– The operational resilience strategy in the Hari Krishna Exports: Transforming Employees 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.
Highly skilled collaborators
– Diamond Hari 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 Hari Krishna Exports: Transforming Employees HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High brand equity
– Diamond Hari has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Diamond Hari to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Organizational Resilience of Diamond Hari
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Diamond Hari does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Superior customer experience
– The customer experience strategy of Diamond Hari in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Successful track record of launching new products
– Diamond Hari has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Diamond Hari 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.
Diverse revenue streams
– Diamond Hari is present in almost all the verticals within the industry. This has provided firm in Hari Krishna Exports: Transforming Employees 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.
Ability to lead change in Organizational Development field
– Diamond Hari 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 Diamond Hari in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Training and development
– Diamond Hari has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Hari Krishna Exports: Transforming Employees 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.
Analytics focus
– Diamond Hari 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 Malay Patel, Patturaja Selvaraj 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.
Learning organization
- Diamond Hari 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 Diamond Hari is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Hari Krishna Exports: Transforming Employees Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Digital Transformation in Organizational Development segment
- digital transformation varies from industry to industry. For Diamond Hari digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Diamond Hari 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.
Weaknesses Hari Krishna Exports: Transforming Employees | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Hari Krishna Exports: Transforming Employees are -
High bargaining power of channel partners
– Because of the regulatory requirements, Malay Patel, Patturaja Selvaraj suggests that, Diamond Hari 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, Diamond Hari is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Hari Krishna Exports: Transforming Employees can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
High cash cycle compare to competitors
Diamond Hari 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.
Interest costs
– Compare to the competition, Diamond Hari 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 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 Diamond Hari supply chain. Even after few cautionary changes mentioned in the HBR case study - Hari Krishna Exports: Transforming Employees, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Diamond Hari vulnerable to further global disruptions in South East Asia.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Hari Krishna Exports: Transforming Employees, in the dynamic environment Diamond Hari has struggled to respond to the nimble upstart competition. Diamond Hari has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Lack of clear differentiation of Diamond Hari products
– To increase the profitability and margins on the products, Diamond Hari needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow decision making process
– As mentioned earlier in the report, Diamond Hari 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. Diamond Hari 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 Hari Krishna Exports: Transforming Employees HBR case study mentions - Diamond Hari 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.
Need for greater diversity
– Diamond Hari has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Hari Krishna Exports: Transforming Employees, is just above the industry average. Diamond Hari 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 Hari Krishna Exports: Transforming Employees | 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 Hari Krishna Exports: Transforming Employees are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Diamond Hari 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.
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. Diamond Hari 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. Diamond Hari 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.
Using analytics as competitive advantage
– Diamond Hari has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Hari Krishna Exports: Transforming Employees - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Diamond Hari to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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 Diamond Hari 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.
Building a culture of innovation
– managers at Diamond Hari 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.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Diamond Hari in the consumer business. Now Diamond Hari can target international markets with far fewer capital restrictions requirements than the existing system.
Creating value in data economy
– The success of analytics program of Diamond Hari has opened avenues for new revenue streams for the organization in the industry. This can help Diamond Hari to build a more holistic ecosystem as suggested in the Hari Krishna Exports: Transforming Employees case study. Diamond Hari can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Diamond Hari is facing challenges because of the dominance of functional experts in the organization. Hari Krishna Exports: Transforming Employees 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.
Leveraging digital technologies
– Diamond Hari 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Diamond Hari can use these opportunities to build new business models that can help the communities that Diamond Hari operates in. Secondly it can use opportunities from government spending in Organizational Development sector.
Low interest rates
– Even though inflation is raising its head in most developed economies, Diamond Hari 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Diamond Hari 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, Hari Krishna Exports: Transforming Employees, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Buying journey improvements
– Diamond Hari can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Hari Krishna Exports: Transforming Employees 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.
Threats Hari Krishna Exports: Transforming Employees External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Hari Krishna Exports: Transforming Employees are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Hari Krishna Exports: Transforming Employees, Diamond Hari 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 .
Technology acceleration in Forth Industrial Revolution
– Diamond Hari has witnessed rapid integration of technology during Covid-19 in the Organizational Development industry. As one of the leading players in the industry, Diamond Hari 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.
Stagnating economy with rate increase
– Diamond Hari 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.
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.
Regulatory challenges
– Diamond Hari 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 Organizational Development industry regulations.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Diamond Hari 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 Hari Krishna Exports: Transforming Employees .
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. Diamond Hari can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Diamond Hari needs to understand the core reasons impacting the Organizational Development industry. This will help it in building a better workplace.
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 Diamond Hari.
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 Diamond Hari is facing in Organizational Development sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Consumer confidence and its impact on Diamond Hari 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Diamond Hari 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.
Weighted SWOT Analysis of Hari Krishna Exports: Transforming Employees 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 Hari Krishna Exports: Transforming Employees 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 Hari Krishna Exports: Transforming Employees 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 Hari Krishna Exports: Transforming Employees 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 Hari Krishna Exports: Transforming Employees 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 Diamond Hari needs to make to build a sustainable competitive advantage.