Hindustan Lever (A): Leaping A Millenium SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Organizational Development
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Hindustan Lever (A): Leaping A Millenium
This three part case series centers on a new business model developed by Hindustan Lever (HLL) to tap the business and sustainability potentials hidden in rural India. It focuses on a win-win partnership with rural, female self-help groups (SHGs). HLL assists SHGs to access micro credit, which is usually restricted. SHGs in turn buy HLL products and sell them in their villages in a decentralized way, thus creating various opportunities for rural communities such as training and income opportunities for women as well as better overall living conditions for their families. The A-case describes the cornerstones and key decisions reached during the inception phase of the project. It details the value chain and expected deliverables for the stakeholder groups. This first case of the series ends when the system has been set up and launched, but reveals none of the actual results.
Authors :: Ulrich Steger, Aileen Ionescu-Somers, Wolfgang Amman
Swot Analysis of "Hindustan Lever (A): Leaping A Millenium" written by Ulrich Steger, Aileen Ionescu-Somers, Wolfgang Amman includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Shgs Hll facing as an external strategic factors. Some of the topics covered in Hindustan Lever (A): Leaping A Millenium case study are - Strategic Management Strategies, Marketing, Sustainability and Organizational Development.
Some of the macro environment factors that can be used to understand the Hindustan Lever (A): Leaping A Millenium casestudy better are - – talent flight as more people leaving formal jobs, there is backlash against globalization, central banks are concerned over increasing inflation, cloud computing is disrupting traditional business models, technology disruption, increasing government debt because of Covid-19 spendings, increasing inequality as vast percentage of new income is going to the top 1%,
challanges to central banks by blockchain based private currencies, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of Hindustan Lever (A): Leaping A Millenium
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Hindustan Lever (A): Leaping A Millenium case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Shgs Hll, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Shgs Hll 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 Hindustan Lever (A): Leaping A Millenium can be done for the following purposes –
1. Strategic planning using facts provided in Hindustan Lever (A): Leaping A Millenium case study
2. Improving business portfolio management of Shgs Hll
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 Shgs Hll
Strengths Hindustan Lever (A): Leaping A Millenium | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Shgs Hll in Hindustan Lever (A): Leaping A Millenium Harvard Business Review case study are -
Analytics focus
– Shgs Hll 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 Ulrich Steger, Aileen Ionescu-Somers, Wolfgang Amman 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.
Cross disciplinary teams
– Horizontal connected teams at the Shgs Hll are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Diverse revenue streams
– Shgs Hll is present in almost all the verticals within the industry. This has provided firm in Hindustan Lever (A): Leaping A Millenium 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.
High brand equity
– Shgs Hll has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Shgs Hll to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– Shgs Hll is one of the most innovative firm in sector. Manager in Hindustan Lever (A): Leaping A Millenium Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Superior customer experience
– The customer experience strategy of Shgs Hll in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– Shgs Hll has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Hindustan Lever (A): Leaping A Millenium 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.
Ability to recruit top talent
– Shgs Hll is one of the leading recruiters in the industry. Managers in the Hindustan Lever (A): Leaping A Millenium are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
High switching costs
– The high switching costs that Shgs Hll 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.
Learning organization
- Shgs Hll 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 Shgs Hll is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Hindustan Lever (A): Leaping A Millenium Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Effective Research and Development (R&D)
– Shgs Hll 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 Hindustan Lever (A): Leaping A Millenium - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Operational resilience
– The operational resilience strategy in the Hindustan Lever (A): Leaping A Millenium 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.
Weaknesses Hindustan Lever (A): Leaping A Millenium | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Hindustan Lever (A): Leaping A Millenium are -
Interest costs
– Compare to the competition, Shgs Hll 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.
Increasing silos among functional specialists
– The organizational structure of Shgs Hll is dominated by functional specialists. It is not different from other players in the Organizational Development segment. Shgs Hll needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Shgs Hll to focus more on services rather than just following the product oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Shgs Hll 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.
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 Shgs Hll supply chain. Even after few cautionary changes mentioned in the HBR case study - Hindustan Lever (A): Leaping A Millenium, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Shgs Hll vulnerable to further global disruptions in South East Asia.
High operating costs
– Compare to the competitors, firm in the HBR case study Hindustan Lever (A): Leaping A Millenium 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 Shgs Hll 's lucrative customers.
Need for greater diversity
– Shgs Hll 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.
Products dominated business model
– Even though Shgs Hll 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 - Hindustan Lever (A): Leaping A Millenium should strive to include more intangible value offerings along with its core products and services.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Hindustan Lever (A): Leaping A Millenium HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Shgs Hll has relatively successful track record of launching new products.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Hindustan Lever (A): Leaping A Millenium, it seems that the employees of Shgs Hll 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.
Skills based hiring
– The stress on hiring functional specialists at Shgs Hll 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.
Lack of clear differentiation of Shgs Hll products
– To increase the profitability and margins on the products, Shgs Hll needs to provide more differentiated products than what it is currently offering in the marketplace.
Opportunities Hindustan Lever (A): Leaping A Millenium | 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 Hindustan Lever (A): Leaping A Millenium are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Shgs Hll 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.
Using analytics as competitive advantage
– Shgs Hll 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 Hindustan Lever (A): Leaping A Millenium - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Shgs Hll to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Learning at scale
– Online learning technologies has now opened space for Shgs Hll 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.
Leveraging digital technologies
– Shgs Hll 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.
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. Shgs Hll 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. Shgs Hll 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.
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. Shgs Hll can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Shgs Hll is facing challenges because of the dominance of functional experts in the organization. Hindustan Lever (A): Leaping A Millenium 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
– Shgs Hll can develop new processes and procedures in Organizational Development 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Shgs Hll 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, Shgs Hll 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, Hindustan Lever (A): Leaping A Millenium, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Better consumer reach
– The expansion of the 5G network will help Shgs Hll to increase its market reach. Shgs Hll 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.
Manufacturing automation
– Shgs Hll 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Shgs Hll 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 Shgs Hll to hire the very best people irrespective of their geographical location.
Threats Hindustan Lever (A): Leaping A Millenium External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Hindustan Lever (A): Leaping A Millenium are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Shgs Hll 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.
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 Shgs Hll business can come under increasing regulations regarding data privacy, data security, etc.
Regulatory challenges
– Shgs Hll 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.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Shgs Hll in the Organizational Development sector and impact the bottomline of the organization.
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 Shgs Hll.
High dependence on third party suppliers
– Shgs Hll 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.
Consumer confidence and its impact on Shgs Hll 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Shgs Hll with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Environmental challenges
– Shgs Hll 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. Shgs Hll can take advantage of this fund but it will also bring new competitors in the Organizational Development industry.
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. Shgs Hll 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 Shgs Hll is facing in Organizational Development sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing wage structure of Shgs Hll
– 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 Shgs Hll.
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. Shgs Hll needs to understand the core reasons impacting the Organizational Development industry. This will help it in building a better workplace.
Weighted SWOT Analysis of Hindustan Lever (A): Leaping A Millenium 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 Hindustan Lever (A): Leaping A Millenium 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 Hindustan Lever (A): Leaping A Millenium 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 Hindustan Lever (A): Leaping A Millenium 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 Hindustan Lever (A): Leaping A Millenium 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 Shgs Hll needs to make to build a sustainable competitive advantage.
