Mary Kay China: People and Love SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Organizational Development
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Mary Kay China: People and Love
Mary Kay (China) Cosmetics Co., Ltd. (Mary Kay China) was one of China's leading direct-enterprises in skincare products and cosmetics. In September 2015, the president of Mary Kay China was considering how best to continue to grow the company in the face of increasing e-commerce. The parent company and all its subsidiaries ascribed to the mission of enriching women's lives; its guiding principles emphasized relationships and connections between people. Mary Kay China's development was a testament to its success as a people-oriented culture that contributed to the environment and society. However, the Internet era had raised concerns about whether the connections among the company's people were strong enough to succeed against competitors who maintained a broad network developed through the Internet. Should Mary Kay China expand into e-commerce, or would relying on the Internet undermine the principles and values that grounded the company? The authors are affiliated with China Europe International Business School.
Swot Analysis of "Mary Kay China: People and Love" written by Jean Lee, Liman Zhao, Yunting Lu includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Kay Mary facing as an external strategic factors. Some of the topics covered in Mary Kay China: People and Love case study are - Strategic Management Strategies, and Organizational Development.
Some of the macro environment factors that can be used to understand the Mary Kay China: People and Love casestudy better are - – increasing transportation and logistics costs, increasing energy prices, competitive advantages are harder to sustain because of technology dispersion, central banks are concerned over increasing inflation, increasing commodity prices, increasing government debt because of Covid-19 spendings, there is increasing trade war between United States & China,
technology disruption, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Mary Kay China: People and Love
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Mary Kay China: People and Love case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Kay Mary, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Kay Mary 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 Mary Kay China: People and Love can be done for the following purposes –
1. Strategic planning using facts provided in Mary Kay China: People and Love case study
2. Improving business portfolio management of Kay Mary
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 Kay Mary
Strengths Mary Kay China: People and Love | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Kay Mary in Mary Kay China: People and Love Harvard Business Review case study are -
High brand equity
– Kay Mary has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Kay Mary to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Strong track record of project management
– Kay Mary is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Digital Transformation in Organizational Development segment
- digital transformation varies from industry to industry. For Kay Mary digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Kay Mary has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Learning organization
- Kay Mary 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 Kay Mary is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Mary Kay China: People and Love Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Superior customer experience
– The customer experience strategy of Kay Mary in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Low bargaining power of suppliers
– Suppliers of Kay Mary in the sector have low bargaining power. Mary Kay China: People and Love has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Kay Mary to manage not only supply disruptions but also source products at highly competitive prices.
Ability to recruit top talent
– Kay Mary is one of the leading recruiters in the industry. Managers in the Mary Kay China: People and Love are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Innovation driven organization
– Kay Mary is one of the most innovative firm in sector. Manager in Mary Kay China: People and Love Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Highly skilled collaborators
– Kay Mary 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 Mary Kay China: People and Love HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Training and development
– Kay Mary has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Mary Kay China: People and Love 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
– Kay Mary 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 Jean Lee, Liman Zhao, Yunting Lu 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.
Diverse revenue streams
– Kay Mary is present in almost all the verticals within the industry. This has provided firm in Mary Kay China: People and Love 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.
Weaknesses Mary Kay China: People and Love | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Mary Kay China: People and Love are -
High bargaining power of channel partners
– Because of the regulatory requirements, Jean Lee, Liman Zhao, Yunting Lu suggests that, Kay Mary 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Kay Mary 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.
Skills based hiring
– The stress on hiring functional specialists at Kay Mary 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Mary Kay China: People and Love, in the dynamic environment Kay Mary has struggled to respond to the nimble upstart competition. Kay Mary has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Need for greater diversity
– Kay Mary 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.
High cash cycle compare to competitors
Kay Mary 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.
Aligning sales with marketing
– It come across in the case study Mary Kay China: People and Love that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Mary Kay China: People and Love can leverage the sales team experience to cultivate customer relationships as Kay Mary is planning to shift buying processes online.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Kay Mary is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Mary Kay China: People and Love can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Slow decision making process
– As mentioned earlier in the report, Kay Mary 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. Kay Mary 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.
Interest costs
– Compare to the competition, Kay Mary 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.
Lack of clear differentiation of Kay Mary products
– To increase the profitability and margins on the products, Kay Mary needs to provide more differentiated products than what it is currently offering in the marketplace.
Opportunities Mary Kay China: People and Love | 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 Mary Kay China: People and Love are -
Buying journey improvements
– Kay Mary can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Mary Kay China: People and Love 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.
Manufacturing automation
– Kay Mary 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 Kay Mary can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Kay Mary 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, Mary Kay China: People and Love, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Building a culture of innovation
– managers at Kay Mary 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, Kay Mary 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Kay Mary can use these opportunities to build new business models that can help the communities that Kay Mary operates in. Secondly it can use opportunities from government spending in Organizational Development sector.
Leveraging digital technologies
– Kay Mary 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.
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 Kay Mary in the consumer business. Now Kay Mary can target international markets with far fewer capital restrictions requirements than the existing system.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Kay Mary is facing challenges because of the dominance of functional experts in the organization. Mary Kay China: People and Love 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.
Better consumer reach
– The expansion of the 5G network will help Kay Mary to increase its market reach. Kay Mary 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.
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 Kay Mary 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.
Creating value in data economy
– The success of analytics program of Kay Mary has opened avenues for new revenue streams for the organization in the industry. This can help Kay Mary to build a more holistic ecosystem as suggested in the Mary Kay China: People and Love case study. Kay Mary can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats Mary Kay China: People and Love External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Mary Kay China: People and Love are -
Consumer confidence and its impact on Kay Mary 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.
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.
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.
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. Kay Mary 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.
Technology acceleration in Forth Industrial Revolution
– Kay Mary has witnessed rapid integration of technology during Covid-19 in the Organizational Development industry. As one of the leading players in the industry, Kay Mary 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
– Kay Mary 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.
High dependence on third party suppliers
– Kay Mary 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.
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. Kay Mary needs to understand the core reasons impacting the Organizational Development industry. This will help it in building a better workplace.
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. Kay Mary 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 Kay Mary
– 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 Kay Mary.
Shortening product life cycle
– it is one of the major threat that Kay Mary 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 Mary Kay China: People and Love, Kay Mary 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 .
Regulatory challenges
– Kay Mary 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.
Weighted SWOT Analysis of Mary Kay China: People and Love 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 Mary Kay China: People and Love 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 Mary Kay China: People and Love 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 Mary Kay China: People and Love 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 Mary Kay China: People and Love 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 Kay Mary needs to make to build a sustainable competitive advantage.
