Stack Brewing: A Little Brewery in the Big Nickel SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Stack Brewing: A Little Brewery in the Big Nickel
Stack Brewing, a start-up craft brewery, has a capacity of approximately 5,600 litres per month based on twelve 117-litre batches per week. A government grant based on growth and job creation potential will help boost production capacity by five times, necessitating the development of additional distribution and marketing communication strategies. The owner cannot afford a listing in the Beer Store, the distribution monopoly owned by Labatt Breweries of Canada and Molson-Coors Canada Inc., and his budget for communications is small. While this case provides an opportunity for students to perform quantitative analysis based on revenues and market size, the focus of the case, however, is on an improved distribution and communication plan. Ron Mulholland is affiliated with Laurentian University.
Authors :: Ron Mulholland, Cameron Brooks, Benoit Roy, Katarina Schwabe
Swot Analysis of "Stack Brewing: A Little Brewery in the Big Nickel" written by Ron Mulholland, Cameron Brooks, Benoit Roy, Katarina Schwabe includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Stack Brewery facing as an external strategic factors. Some of the topics covered in Stack Brewing: A Little Brewery in the Big Nickel case study are - Strategic Management Strategies, Marketing and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Stack Brewing: A Little Brewery in the Big Nickel casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, technology disruption, talent flight as more people leaving formal jobs, supply chains are disrupted by pandemic , there is increasing trade war between United States & China, increasing household debt because of falling income levels, challanges to central banks by blockchain based private currencies,
increasing commodity prices, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Stack Brewing: A Little Brewery in the Big Nickel
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Stack Brewing: A Little Brewery in the Big Nickel case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Stack Brewery, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Stack Brewery 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 Stack Brewing: A Little Brewery in the Big Nickel can be done for the following purposes –
1. Strategic planning using facts provided in Stack Brewing: A Little Brewery in the Big Nickel case study
2. Improving business portfolio management of Stack Brewery
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 Stack Brewery
Strengths Stack Brewing: A Little Brewery in the Big Nickel | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Stack Brewery in Stack Brewing: A Little Brewery in the Big Nickel Harvard Business Review case study are -
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Stack Brewery digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Stack Brewery 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.
Analytics focus
– Stack Brewery 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 Ron Mulholland, Cameron Brooks, Benoit Roy, Katarina Schwabe 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.
Operational resilience
– The operational resilience strategy in the Stack Brewing: A Little Brewery in the Big Nickel 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.
Cross disciplinary teams
– Horizontal connected teams at the Stack Brewery 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.
Innovation driven organization
– Stack Brewery is one of the most innovative firm in sector. Manager in Stack Brewing: A Little Brewery in the Big Nickel 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)
– Stack Brewery 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 Stack Brewing: A Little Brewery in the Big Nickel - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to lead change in Sales & Marketing field
– Stack Brewery 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 Stack Brewery in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Ability to recruit top talent
– Stack Brewery is one of the leading recruiters in the industry. Managers in the Stack Brewing: A Little Brewery in the Big Nickel are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Strong track record of project management
– Stack Brewery is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Superior customer experience
– The customer experience strategy of Stack Brewery in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– Stack Brewery has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Stack Brewing: A Little Brewery in the Big Nickel 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.
Highly skilled collaborators
– Stack Brewery 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 Stack Brewing: A Little Brewery in the Big Nickel HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses Stack Brewing: A Little Brewery in the Big Nickel | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Stack Brewing: A Little Brewery in the Big Nickel are -
Aligning sales with marketing
– It come across in the case study Stack Brewing: A Little Brewery in the Big Nickel 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 Stack Brewing: A Little Brewery in the Big Nickel can leverage the sales team experience to cultivate customer relationships as Stack Brewery is planning to shift buying processes online.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Stack Brewing: A Little Brewery in the Big Nickel, it seems that the employees of Stack Brewery 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.
Products dominated business model
– Even though Stack Brewery 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 - Stack Brewing: A Little Brewery in the Big Nickel should strive to include more intangible value offerings along with its core products and services.
Interest costs
– Compare to the competition, Stack Brewery 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.
No frontier risks strategy
– After analyzing the HBR case study Stack Brewing: A Little Brewery in the Big Nickel, 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.
Slow decision making process
– As mentioned earlier in the report, Stack Brewery 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. Stack Brewery 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, Stack Brewery is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Stack Brewing: A Little Brewery in the Big Nickel 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 Stack Brewery 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.
Increasing silos among functional specialists
– The organizational structure of Stack Brewery is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Stack Brewery needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Stack Brewery to focus more on services rather than just following the product oriented approach.
High cash cycle compare to competitors
Stack Brewery 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Stack Brewing: A Little Brewery in the Big Nickel 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 Stack Brewery has relatively successful track record of launching new products.
Opportunities Stack Brewing: A Little Brewery in the Big Nickel | 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 Stack Brewing: A Little Brewery in the Big Nickel are -
Using analytics as competitive advantage
– Stack Brewery 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 Stack Brewing: A Little Brewery in the Big Nickel - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Stack Brewery to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Better consumer reach
– The expansion of the 5G network will help Stack Brewery to increase its market reach. Stack Brewery 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.
Creating value in data economy
– The success of analytics program of Stack Brewery has opened avenues for new revenue streams for the organization in the industry. This can help Stack Brewery to build a more holistic ecosystem as suggested in the Stack Brewing: A Little Brewery in the Big Nickel case study. Stack Brewery can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Stack Brewery can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Stack Brewing: A Little Brewery in the Big Nickel 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.
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 Stack Brewery in the consumer business. Now Stack Brewery can target international markets with far fewer capital restrictions requirements than the existing system.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Stack Brewery is facing challenges because of the dominance of functional experts in the organization. Stack Brewing: A Little Brewery in the Big Nickel 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.
Leveraging digital technologies
– Stack Brewery 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.
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. Stack Brewery can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Stack Brewery 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.
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 Stack Brewery 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. Stack Brewery can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Stack Brewery can use these opportunities to build new business models that can help the communities that Stack Brewery operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Developing new processes and practices
– Stack Brewery 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.
Threats Stack Brewing: A Little Brewery in the Big Nickel External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Stack Brewing: A Little Brewery in the Big Nickel are -
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 Stack Brewery.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Stack Brewery with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Environmental challenges
– Stack Brewery 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. Stack Brewery can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Stack Brewery 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 Stack Brewing: A Little Brewery in the Big Nickel .
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Stack Brewery 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.
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 Stack Brewery in the Sales & Marketing sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Stack Brewery 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.
Consumer confidence and its impact on Stack Brewery 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 Stack Brewery
– 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 Stack Brewery.
Shortening product life cycle
– it is one of the major threat that Stack Brewery is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Stack Brewery needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
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 Stack Brewery business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of Stack Brewing: A Little Brewery in the Big Nickel 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 Stack Brewing: A Little Brewery in the Big Nickel 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 Stack Brewing: A Little Brewery in the Big Nickel 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 Stack Brewing: A Little Brewery in the Big Nickel 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 Stack Brewing: A Little Brewery in the Big Nickel 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 Stack Brewery needs to make to build a sustainable competitive advantage.