Alara Agri: Fresh Cherry Production SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Organizational Development
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Alara Agri: Fresh Cherry Production
Alara Agri, based in Bursa, Turkey, is one of the world's foremost cherry and fig producers. The president and chief executive officer (CEO) was concerned about a recurring capacity problem at the end of the process where cherries were packed. On some of the plant's conveyor belts, piles of cherries of one size waited to be packed while other belts had too few cherries to keep workers busy, and thus delayed order fulfillment. Diverting excess cherries from a busy line to an underutilized line was not an option as cherries were sorted by size. One solution the CEO had considered was to build another processing line at a cost of US$2 million, although he thought a better solution may be achieved by changing the process or reconfiguring the flow of the machine. The CEO wondered how best to improve capacity with the equipment they already had. To aid in his decision, he examined corporate data with regards to revenues and production figures, incoming cherries received in tonnes, expected size distribution of cherries, and the plant layout and packaging options.
Swot Analysis of "Alara Agri: Fresh Cherry Production" written by Chris J. Piper, Jordan Mitchell includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Cherries Alara facing as an external strategic factors. Some of the topics covered in Alara Agri: Fresh Cherry Production case study are - Strategic Management Strategies, Manufacturing and Organizational Development.
Some of the macro environment factors that can be used to understand the Alara Agri: Fresh Cherry Production casestudy better are - – supply chains are disrupted by pandemic , increasing commodity prices, there is increasing trade war between United States & China, competitive advantages are harder to sustain because of technology dispersion, central banks are concerned over increasing inflation, increasing government debt because of Covid-19 spendings, increasing inequality as vast percentage of new income is going to the top 1%,
cloud computing is disrupting traditional business models, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Alara Agri: Fresh Cherry Production
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Alara Agri: Fresh Cherry Production case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Cherries Alara, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Cherries Alara 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 Alara Agri: Fresh Cherry Production can be done for the following purposes –
1. Strategic planning using facts provided in Alara Agri: Fresh Cherry Production case study
2. Improving business portfolio management of Cherries Alara
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 Cherries Alara
Strengths Alara Agri: Fresh Cherry Production | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Cherries Alara in Alara Agri: Fresh Cherry Production Harvard Business Review case study are -
High brand equity
– Cherries Alara has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Cherries Alara to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Digital Transformation in Organizational Development segment
- digital transformation varies from industry to industry. For Cherries Alara digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Cherries Alara 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.
Superior customer experience
– The customer experience strategy of Cherries Alara in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Organizational Resilience of Cherries Alara
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Cherries Alara does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Diverse revenue streams
– Cherries Alara is present in almost all the verticals within the industry. This has provided firm in Alara Agri: Fresh Cherry Production 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.
Successful track record of launching new products
– Cherries Alara has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Cherries Alara 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.
Operational resilience
– The operational resilience strategy in the Alara Agri: Fresh Cherry Production 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.
Innovation driven organization
– Cherries Alara is one of the most innovative firm in sector. Manager in Alara Agri: Fresh Cherry Production Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Effective Research and Development (R&D)
– Cherries Alara 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 Alara Agri: Fresh Cherry Production - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Learning organization
- Cherries Alara 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 Cherries Alara is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Alara Agri: Fresh Cherry Production Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Strong track record of project management
– Cherries Alara is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High switching costs
– The high switching costs that Cherries Alara 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.
Weaknesses Alara Agri: Fresh Cherry Production | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Alara Agri: Fresh Cherry Production are -
Workers concerns about automation
– As automation is fast increasing in the segment, Cherries Alara needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
High bargaining power of channel partners
– Because of the regulatory requirements, Chris J. Piper, Jordan Mitchell suggests that, Cherries Alara 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Alara Agri: Fresh Cherry Production, is just above the industry average. Cherries Alara 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.
Lack of clear differentiation of Cherries Alara products
– To increase the profitability and margins on the products, Cherries Alara needs to provide more differentiated products than what it is currently offering in the marketplace.
Skills based hiring
– The stress on hiring functional specialists at Cherries Alara 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Alara Agri: Fresh Cherry Production 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 Cherries Alara has relatively successful track record of launching new products.
Need for greater diversity
– Cherries Alara 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.
Increasing silos among functional specialists
– The organizational structure of Cherries Alara is dominated by functional specialists. It is not different from other players in the Organizational Development segment. Cherries Alara needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Cherries Alara to focus more on services rather than just following the product oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Cherries Alara 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Cherries Alara is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Alara Agri: Fresh Cherry Production can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Products dominated business model
– Even though Cherries Alara 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 - Alara Agri: Fresh Cherry Production should strive to include more intangible value offerings along with its core products and services.
Opportunities Alara Agri: Fresh Cherry Production | 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 Alara Agri: Fresh Cherry Production are -
Creating value in data economy
– The success of analytics program of Cherries Alara has opened avenues for new revenue streams for the organization in the industry. This can help Cherries Alara to build a more holistic ecosystem as suggested in the Alara Agri: Fresh Cherry Production case study. Cherries Alara 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, Cherries Alara is facing challenges because of the dominance of functional experts in the organization. Alara Agri: Fresh Cherry Production 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Cherries Alara 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.
Buying journey improvements
– Cherries Alara can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Alara Agri: Fresh Cherry Production 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Cherries Alara 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, Alara Agri: Fresh Cherry Production, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Manufacturing automation
– Cherries Alara 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.
Using analytics as competitive advantage
– Cherries Alara 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 Alara Agri: Fresh Cherry Production - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Cherries Alara to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Cherries Alara can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Loyalty marketing
– Cherries Alara 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.
Learning at scale
– Online learning technologies has now opened space for Cherries Alara 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Cherries Alara 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 Cherries Alara to hire the very best people irrespective of their geographical location.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Cherries Alara 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.
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. Cherries Alara can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats Alara Agri: Fresh Cherry Production External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Alara Agri: Fresh Cherry Production are -
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 Cherries Alara business can come under increasing regulations regarding data privacy, data security, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Cherries Alara with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Cherries Alara 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 Alara Agri: Fresh Cherry Production .
Environmental challenges
– Cherries Alara 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. Cherries Alara can take advantage of this fund but it will also bring new competitors in the Organizational Development industry.
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 Cherries Alara in the Organizational Development sector and impact the bottomline of the organization.
Consumer confidence and its impact on Cherries Alara demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Increasing wage structure of Cherries Alara
– 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 Cherries Alara.
High dependence on third party suppliers
– Cherries Alara 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.
Regulatory challenges
– Cherries Alara 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Cherries Alara 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.
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. Cherries Alara needs to understand the core reasons impacting the Organizational Development industry. This will help it in building a better workplace.
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.
Technology acceleration in Forth Industrial Revolution
– Cherries Alara has witnessed rapid integration of technology during Covid-19 in the Organizational Development industry. As one of the leading players in the industry, Cherries Alara 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.
Weighted SWOT Analysis of Alara Agri: Fresh Cherry Production 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 Alara Agri: Fresh Cherry Production 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 Alara Agri: Fresh Cherry Production 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 Alara Agri: Fresh Cherry Production 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 Alara Agri: Fresh Cherry Production 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 Cherries Alara needs to make to build a sustainable competitive advantage.
