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 - – there is increasing trade war between United States & China, geopolitical disruptions, banking and financial system is disrupted by Bitcoin and other crypto currencies, challanges to central banks by blockchain based private currencies, supply chains are disrupted by pandemic , increasing transportation and logistics costs, increasing energy prices,
technology disruption, increasing government debt because of Covid-19 spendings, 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 -
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.
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 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.
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 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.
Low bargaining power of suppliers
– Suppliers of Shgs Hll in the sector have low bargaining power. Hindustan Lever (A): Leaping A Millenium has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Shgs Hll to manage not only supply disruptions but also source products at highly competitive prices.
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.
Highly skilled collaborators
– Shgs Hll 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 Hindustan Lever (A): Leaping A Millenium HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of Shgs Hll
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Shgs Hll does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Digital Transformation in Organizational Development segment
- digital transformation varies from industry to industry. For Shgs Hll digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Shgs Hll 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.
Ability to lead change in Organizational Development field
– Shgs Hll 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 Shgs Hll in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
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 -
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.
No frontier risks strategy
– After analyzing the HBR case study Hindustan Lever (A): Leaping A Millenium, it seems that company is thinking about the frontier risks that can impact Organizational Development strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
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.
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 cash cycle compare to competitors
Shgs Hll 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.
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.
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.
Slow to strategic competitive environment developments
– As Hindustan Lever (A): Leaping A Millenium HBR case study mentions - Shgs Hll 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Shgs Hll is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Hindustan Lever (A): Leaping A Millenium can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Shgs Hll 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 Hindustan Lever (A): Leaping A Millenium, is just above the industry average. Shgs Hll 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 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 -
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.
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.
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.
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.
Buying journey improvements
– Shgs Hll can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Hindustan Lever (A): Leaping A Millenium 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.
Building a culture of innovation
– managers at Shgs Hll 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.
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.
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 Shgs Hll in the consumer business. Now Shgs Hll can target international markets with far fewer capital restrictions requirements than the existing system.
Loyalty marketing
– Shgs Hll has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Organizational Development industry, but it has also influenced the consumer preferences. Shgs Hll can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Shgs Hll can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 -
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Shgs Hll will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
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.
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.
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.
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.
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.
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.
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.
Stagnating economy with rate increase
– Shgs Hll 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 acceleration in Forth Industrial Revolution
– Shgs Hll has witnessed rapid integration of technology during Covid-19 in the Organizational Development industry. As one of the leading players in the industry, Shgs Hll 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.
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.
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.
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.
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.