Case Study Description of Grey Worldwide: Strategic Repositioning Through CRM
Discusses how Grey Worldwide Hong Kong and China (Grey WW-HK/China) is repositioning itself through defined e-marketing and CRM strategies for the Asian market. Examines how integral its customer relationship group is in building a CRM strategy to deliver client value proposition. Grey WW-HK/China has very strong umbrella brand equity, but the brand capital has to be invigorated through a renewed e-marketing focus. Constrained by changing market conditions, particularly industry pressure on commission margins, Grey WW-HK/China needs to differentiate itself and is assessing CRM's value in developing loyal and lifetime customers. However, in a growing Asian market, Grey WW-HK/China is in heated competition with other players, including management consultants, traditional agencies, and pure on-line players who are actively pursuing a CRM business focus. Grey WW-HK/China's CRM team is in the process of developing an Asia-specific CRM blueprint for its internal management, something that is transferable to Grey's clients. Grey WW-HK/China is considering merging technology with traditional marketing philosophy, and the team is expected to deliver a proposal that outlines the CRM tools that Grey WW-HK/China should use to reposition its brand and build customer loyalty.
Authors :: Julie Yu, Ali F. Farhoomand, Shamza Khan, Marissa McCauley
Swot Analysis of "Grey Worldwide: Strategic Repositioning Through CRM" written by Julie Yu, Ali F. Farhoomand, Shamza Khan, Marissa McCauley includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Grey Ww facing as an external strategic factors. Some of the topics covered in Grey Worldwide: Strategic Repositioning Through CRM case study are - Strategic Management Strategies, Customers, Knowledge management, Strategy execution and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Grey Worldwide: Strategic Repositioning Through CRM casestudy better are - – there is increasing trade war between United States & China, increasing commodity prices, customer relationship management is fast transforming because of increasing concerns over data privacy, central banks are concerned over increasing inflation, digital marketing is dominated by two big players Facebook and Google, increasing energy prices, increasing household debt because of falling income levels,
banking and financial system is disrupted by Bitcoin and other crypto currencies, technology disruption, etc
Introduction to SWOT Analysis of Grey Worldwide: Strategic Repositioning Through CRM
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Grey Worldwide: Strategic Repositioning Through CRM case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Grey Ww, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Grey Ww 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 Grey Worldwide: Strategic Repositioning Through CRM can be done for the following purposes –
1. Strategic planning using facts provided in Grey Worldwide: Strategic Repositioning Through CRM case study
2. Improving business portfolio management of Grey Ww
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 Grey Ww
Strengths Grey Worldwide: Strategic Repositioning Through CRM | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Grey Ww in Grey Worldwide: Strategic Repositioning Through CRM Harvard Business Review case study are -
Ability to recruit top talent
– Grey Ww is one of the leading recruiters in the industry. Managers in the Grey Worldwide: Strategic Repositioning Through CRM are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Highly skilled collaborators
– Grey Ww 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 Grey Worldwide: Strategic Repositioning Through CRM HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to lead change in Sales & Marketing field
– Grey Ww 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 Grey Ww in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Effective Research and Development (R&D)
– Grey Ww 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 Grey Worldwide: Strategic Repositioning Through CRM - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Successful track record of launching new products
– Grey Ww has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Grey Ww 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.
Superior customer experience
– The customer experience strategy of Grey Ww in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Organizational Resilience of Grey Ww
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Grey Ww does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Sustainable margins compare to other players in Sales & Marketing industry
– Grey Worldwide: Strategic Repositioning Through CRM firm has clearly differentiated products in the market place. This has enabled Grey Ww to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Grey Ww to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Grey Ww 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.
Learning organization
- Grey Ww 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 Grey Ww is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Grey Worldwide: Strategic Repositioning Through CRM Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Analytics focus
– Grey Ww 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 Julie Yu, Ali F. Farhoomand, Shamza Khan, Marissa McCauley 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.
High brand equity
– Grey Ww has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Grey Ww to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses Grey Worldwide: Strategic Repositioning Through CRM | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Grey Worldwide: Strategic Repositioning Through CRM are -
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 Grey Ww supply chain. Even after few cautionary changes mentioned in the HBR case study - Grey Worldwide: Strategic Repositioning Through CRM, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Grey Ww vulnerable to further global disruptions in South East Asia.
Interest costs
– Compare to the competition, Grey Ww 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.
Need for greater diversity
– Grey Ww 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
Grey Ww 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.
Low market penetration in new markets
– Outside its home market of Grey Ww, firm in the HBR case study Grey Worldwide: Strategic Repositioning Through CRM needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Capital Spending Reduction
– Even during the low interest decade, Grey Ww 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 decision making process
– As mentioned earlier in the report, Grey Ww 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. Grey Ww 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Grey Ww is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Grey Worldwide: Strategic Repositioning Through CRM can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Skills based hiring
– The stress on hiring functional specialists at Grey Ww 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.
Aligning sales with marketing
– It come across in the case study Grey Worldwide: Strategic Repositioning Through CRM 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 Grey Worldwide: Strategic Repositioning Through CRM can leverage the sales team experience to cultivate customer relationships as Grey Ww is planning to shift buying processes online.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Grey Worldwide: Strategic Repositioning Through CRM, in the dynamic environment Grey Ww has struggled to respond to the nimble upstart competition. Grey Ww has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Opportunities Grey Worldwide: Strategic Repositioning Through CRM | 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 Grey Worldwide: Strategic Repositioning Through CRM are -
Creating value in data economy
– The success of analytics program of Grey Ww has opened avenues for new revenue streams for the organization in the industry. This can help Grey Ww to build a more holistic ecosystem as suggested in the Grey Worldwide: Strategic Repositioning Through CRM case study. Grey Ww can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Low interest rates
– Even though inflation is raising its head in most developed economies, Grey Ww 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Sales & Marketing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Grey Ww can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Grey Ww can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Grey Ww is facing challenges because of the dominance of functional experts in the organization. Grey Worldwide: Strategic Repositioning Through CRM 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.
Buying journey improvements
– Grey Ww can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Grey Worldwide: Strategic Repositioning Through CRM 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.
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 Grey Ww 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Sales & Marketing industry, but it has also influenced the consumer preferences. Grey Ww can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Grey Ww 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.
Manufacturing automation
– Grey Ww 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.
Building a culture of innovation
– managers at Grey Ww 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.
Using analytics as competitive advantage
– Grey Ww 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 Grey Worldwide: Strategic Repositioning Through CRM - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Grey Ww to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Developing new processes and practices
– Grey Ww can develop new processes and procedures in Sales & Marketing industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
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 Grey Ww in the consumer business. Now Grey Ww can target international markets with far fewer capital restrictions requirements than the existing system.
Threats Grey Worldwide: Strategic Repositioning Through CRM External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Grey Worldwide: Strategic Repositioning Through CRM 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 Grey Ww business can come under increasing regulations regarding data privacy, data security, etc.
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 Grey Ww.
Consumer confidence and its impact on Grey Ww 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.
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. Grey Ww can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Grey Ww in the Sales & Marketing sector and impact the bottomline of the organization.
Regulatory challenges
– Grey Ww 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 Sales & Marketing industry regulations.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Grey Worldwide: Strategic Repositioning Through CRM, Grey Ww 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 .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Grey Ww in the Sales & Marketing industry. The Sales & Marketing 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.
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 international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Grey Ww 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 Grey Worldwide: Strategic Repositioning Through CRM .
Shortening product life cycle
– it is one of the major threat that Grey Ww is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing wage structure of Grey Ww
– 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 Grey Ww.
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. Grey Ww 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 Grey Worldwide: Strategic Repositioning Through CRM 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 Grey Worldwide: Strategic Repositioning Through CRM 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 Grey Worldwide: Strategic Repositioning Through CRM 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 Grey Worldwide: Strategic Repositioning Through CRM 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 Grey Worldwide: Strategic Repositioning Through CRM 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 Grey Ww needs to make to build a sustainable competitive advantage.