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 - – increasing transportation and logistics costs, increasing energy prices, customer relationship management is fast transforming because of increasing concerns over data privacy, supply chains are disrupted by pandemic , increasing government debt because of Covid-19 spendings, there is backlash against globalization, there is increasing trade war between United States & China,
geopolitical disruptions, central banks are concerned over increasing inflation, 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 -
Low bargaining power of suppliers
– Suppliers of Grey Ww in the sector have low bargaining power. Grey Worldwide: Strategic Repositioning Through CRM has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Grey Ww to manage not only supply disruptions but also source products at highly competitive prices.
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.
Strong track record of project management
– Grey Ww is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
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.
Training and development
– Grey Ww has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Grey Worldwide: Strategic Repositioning Through CRM 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 Grey Ww digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Grey Ww has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Ability to lead change in 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.
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.
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.
Diverse revenue streams
– Grey Ww is present in almost all the verticals within the industry. This has provided firm in Grey Worldwide: Strategic Repositioning Through CRM case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
High 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.
High switching costs
– The high switching costs that Grey Ww 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 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 -
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.
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.
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.
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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Grey Worldwide: Strategic Repositioning Through CRM 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 Grey Ww has relatively successful track record of launching new products.
Lack of clear differentiation of Grey Ww products
– To increase the profitability and margins on the products, Grey Ww needs to provide more differentiated products than what it is currently offering in the marketplace.
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.
No frontier risks strategy
– After analyzing the HBR case study Grey Worldwide: Strategic Repositioning Through CRM, it seems that company is thinking about the frontier risks that can impact Sales & Marketing strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Grey Worldwide: Strategic Repositioning Through CRM, is just above the industry average. Grey Ww 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.
Slow to strategic competitive environment developments
– As Grey Worldwide: Strategic Repositioning Through CRM HBR case study mentions - Grey Ww takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, 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.
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 -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Grey Ww 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 Grey Ww to hire the very best people irrespective of their geographical location.
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.
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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Grey Ww can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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.
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.
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. Grey Ww can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Grey Ww can use these opportunities to build new business models that can help the communities that Grey Ww operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Learning at scale
– Online learning technologies has now opened space for Grey Ww 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.
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.
Leveraging digital technologies
– Grey Ww 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.
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 -
Stagnating economy with rate increase
– Grey Ww can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Technology 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.
Environmental challenges
– Grey Ww 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. Grey Ww can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
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.
Technology acceleration in Forth Industrial Revolution
– Grey Ww has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Grey Ww 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.
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.
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.
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.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Grey Ww with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
High dependence on third party suppliers
– Grey Ww 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. Grey Ww needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
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.
