Case Study Description of Clean Edge Razor: Splitting Hairs in Product Positioning
After three years of development, Paramount Health and Beauty Company is preparing to launch a new technologically advanced vibrating razor called Clean Edge. The innovative new design of Clean Edge provides superior performance by stimulating the hair follicles to lift the hair from the skin, allowing for a closer shave. The company has already decided to introduce Clean Edge into the men's market where it has a strong presence. Jackson Randall, the product manager for Clean Edge, struggles with how best to position the product for the launch. One strategy is to release Clean Edge as a "niche" product, targeting the high-end market of fastidious groomers looking for superior skin care products. Another strategy is to release the product into the highly competitive mainstream razor market where the product can be positioned as the most effective razor available. Randall meets internal resistance to the mainstream strategy from the product manager for the company's current, but aging, mainstream razor products and he must consider the effects of cannibalization in his plan. Randall must recommend an optimal strategy and provide supporting economic analysis of his decision--not just for Clean Edge, but for its effect on the entire company.
Swot Analysis of "Clean Edge Razor: Splitting Hairs in Product Positioning" written by John A. Quelch, Heather Beckham includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Razor Clean facing as an external strategic factors. Some of the topics covered in Clean Edge Razor: Splitting Hairs in Product Positioning case study are - Strategic Management Strategies, Change management, Conflict, Financial analysis, Leadership, Marketing, Product development and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Clean Edge Razor: Splitting Hairs in Product Positioning casestudy better are - – supply chains are disrupted by pandemic , there is backlash against globalization, increasing household debt because of falling income levels, central banks are concerned over increasing inflation, increasing energy prices, wage bills are increasing, increasing government debt because of Covid-19 spendings,
competitive advantages are harder to sustain because of technology dispersion, geopolitical disruptions, etc
Introduction to SWOT Analysis of Clean Edge Razor: Splitting Hairs in Product Positioning
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Clean Edge Razor: Splitting Hairs in Product Positioning case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Razor Clean, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Razor Clean 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 Clean Edge Razor: Splitting Hairs in Product Positioning can be done for the following purposes –
1. Strategic planning using facts provided in Clean Edge Razor: Splitting Hairs in Product Positioning case study
2. Improving business portfolio management of Razor Clean
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Razor Clean
Strengths Clean Edge Razor: Splitting Hairs in Product Positioning | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Razor Clean in Clean Edge Razor: Splitting Hairs in Product Positioning Harvard Business Review case study are -
Cross disciplinary teams
– Horizontal connected teams at the Razor Clean 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.
Operational resilience
– The operational resilience strategy in the Clean Edge Razor: Splitting Hairs in Product Positioning 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.
Training and development
– Razor Clean has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Clean Edge Razor: Splitting Hairs in Product Positioning 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.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Razor Clean digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Razor Clean 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
- Razor Clean 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 Razor Clean is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Clean Edge Razor: Splitting Hairs in Product Positioning Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– Razor Clean is one of the leading recruiters in the industry. Managers in the Clean Edge Razor: Splitting Hairs in Product Positioning are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Successful track record of launching new products
– Razor Clean has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Razor Clean 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.
Innovation driven organization
– Razor Clean is one of the most innovative firm in sector. Manager in Clean Edge Razor: Splitting Hairs in Product Positioning Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Diverse revenue streams
– Razor Clean is present in almost all the verticals within the industry. This has provided firm in Clean Edge Razor: Splitting Hairs in Product Positioning 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.
Low bargaining power of suppliers
– Suppliers of Razor Clean in the sector have low bargaining power. Clean Edge Razor: Splitting Hairs in Product Positioning has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Razor Clean to manage not only supply disruptions but also source products at highly competitive prices.
High brand equity
– Razor Clean has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Razor Clean to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Effective Research and Development (R&D)
– Razor Clean 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 Clean Edge Razor: Splitting Hairs in Product Positioning - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses Clean Edge Razor: Splitting Hairs in Product Positioning | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Clean Edge Razor: Splitting Hairs in Product Positioning are -
High bargaining power of channel partners
– Because of the regulatory requirements, John A. Quelch, Heather Beckham suggests that, Razor Clean is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Slow decision making process
– As mentioned earlier in the report, Razor Clean 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. Razor Clean 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.
Capital Spending Reduction
– Even during the low interest decade, Razor Clean 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.
Increasing silos among functional specialists
– The organizational structure of Razor Clean is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Razor Clean needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Razor Clean to focus more on services rather than just following the product oriented approach.
Products dominated business model
– Even though Razor Clean 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 - Clean Edge Razor: Splitting Hairs in Product Positioning 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 Clean Edge Razor: Splitting Hairs in Product Positioning 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 Razor Clean has relatively successful track record of launching new products.
Interest costs
– Compare to the competition, Razor Clean has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
High operating costs
– Compare to the competitors, firm in the HBR case study Clean Edge Razor: Splitting Hairs in Product Positioning 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 Razor Clean 's lucrative customers.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Clean Edge Razor: Splitting Hairs in Product Positioning, it seems that the employees of Razor Clean 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.
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 Razor Clean supply chain. Even after few cautionary changes mentioned in the HBR case study - Clean Edge Razor: Splitting Hairs in Product Positioning, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Razor Clean vulnerable to further global disruptions in South East Asia.
Workers concerns about automation
– As automation is fast increasing in the segment, Razor Clean 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.
Opportunities Clean Edge Razor: Splitting Hairs in Product Positioning | 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 Clean Edge Razor: Splitting Hairs in Product Positioning are -
Leveraging digital technologies
– Razor Clean 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.
Better consumer reach
– The expansion of the 5G network will help Razor Clean to increase its market reach. Razor Clean 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.
Learning at scale
– Online learning technologies has now opened space for Razor Clean 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.
Manufacturing automation
– Razor Clean can use the latest technology developments to improve its manufacturing and designing process in Sales & Marketing 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 Razor Clean 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, Razor Clean 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, Clean Edge Razor: Splitting Hairs in Product Positioning, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Low interest rates
– Even though inflation is raising its head in most developed economies, Razor Clean 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 Razor Clean in the consumer business. Now Razor Clean can target international markets with far fewer capital restrictions requirements than the existing system.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Razor Clean in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Sales & Marketing 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. Razor Clean can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Building a culture of innovation
– managers at Razor Clean 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 Sales & Marketing segment.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Razor Clean is facing challenges because of the dominance of functional experts in the organization. Clean Edge Razor: Splitting Hairs in Product Positioning 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Razor Clean 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 Razor Clean to hire the very best people irrespective of their geographical location.
Threats Clean Edge Razor: Splitting Hairs in Product Positioning External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Clean Edge Razor: Splitting Hairs in Product Positioning are -
Shortening product life cycle
– it is one of the major threat that Razor Clean is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Razor Clean business can come under increasing regulations regarding data privacy, data security, etc.
Technology acceleration in Forth Industrial Revolution
– Razor Clean has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Razor Clean needs to keep up with the evolution of technology in the Sales & Marketing 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.
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.
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. Razor Clean needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Environmental challenges
– Razor Clean 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. Razor Clean can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Easy access to finance
– Easy access to finance in Sales & Marketing field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Razor Clean can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Razor Clean.
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 Razor Clean in the Sales & Marketing sector and impact the bottomline 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.
Increasing wage structure of Razor Clean
– 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 Razor Clean.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Clean Edge Razor: Splitting Hairs in Product Positioning, Razor Clean may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Sales & Marketing .
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. Razor Clean 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.
Weighted SWOT Analysis of Clean Edge Razor: Splitting Hairs in Product Positioning 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 Clean Edge Razor: Splitting Hairs in Product Positioning 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 Clean Edge Razor: Splitting Hairs in Product Positioning 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 Clean Edge Razor: Splitting Hairs in Product Positioning 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 Clean Edge Razor: Splitting Hairs in Product Positioning 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 Razor Clean needs to make to build a sustainable competitive advantage.