Swot Analysis of "Chilli Beans: Peace, Love, and Sunglasses" written by Jose B. Alvarez, Robert Mackalski, Andrew Otazo includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Chilli Sunglasses facing as an external strategic factors. Some of the topics covered in Chilli Beans: Peace, Love, and Sunglasses case study are - Strategic Management Strategies, Design, Entrepreneurship, Financial markets, Growth strategy, International business, Leadership, Manufacturing, Organizational culture, Supply chain and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Chilli Beans: Peace, Love, and Sunglasses casestudy better are - – digital marketing is dominated by two big players Facebook and Google, there is increasing trade war between United States & China, increasing inequality as vast percentage of new income is going to the top 1%, wage bills are increasing, increasing government debt because of Covid-19 spendings, there is backlash against globalization, geopolitical disruptions,
increasing household debt because of falling income levels, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of Chilli Beans: Peace, Love, and Sunglasses
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Chilli Beans: Peace, Love, and Sunglasses case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Chilli Sunglasses, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Chilli Sunglasses 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 Chilli Beans: Peace, Love, and Sunglasses can be done for the following purposes –
1. Strategic planning using facts provided in Chilli Beans: Peace, Love, and Sunglasses case study
2. Improving business portfolio management of Chilli Sunglasses
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 Chilli Sunglasses
Strengths Chilli Beans: Peace, Love, and Sunglasses | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Chilli Sunglasses in Chilli Beans: Peace, Love, and Sunglasses Harvard Business Review case study are -
Operational resilience
– The operational resilience strategy in the Chilli Beans: Peace, Love, and Sunglasses 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.
Superior customer experience
– The customer experience strategy of Chilli Sunglasses in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Organizational Resilience of Chilli Sunglasses
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Chilli Sunglasses does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Chilli Sunglasses is one of the leading recruiters in the industry. Managers in the Chilli Beans: Peace, Love, and Sunglasses are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Chilli Sunglasses digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Chilli Sunglasses 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.
Successful track record of launching new products
– Chilli Sunglasses has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Chilli Sunglasses 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.
Highly skilled collaborators
– Chilli Sunglasses 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 Chilli Beans: Peace, Love, and Sunglasses HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Chilli Sunglasses is one of the most innovative firm in sector. Manager in Chilli Beans: Peace, Love, and Sunglasses Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Sustainable margins compare to other players in Sales & Marketing industry
– Chilli Beans: Peace, Love, and Sunglasses firm has clearly differentiated products in the market place. This has enabled Chilli Sunglasses to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Chilli Sunglasses to invest into research and development (R&D) and innovation.
Ability to lead change in Sales & Marketing field
– Chilli Sunglasses 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 Chilli Sunglasses in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Low bargaining power of suppliers
– Suppliers of Chilli Sunglasses in the sector have low bargaining power. Chilli Beans: Peace, Love, and Sunglasses has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Chilli Sunglasses to manage not only supply disruptions but also source products at highly competitive prices.
Effective Research and Development (R&D)
– Chilli Sunglasses 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 Chilli Beans: Peace, Love, and Sunglasses - 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 Chilli Beans: Peace, Love, and Sunglasses | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Chilli Beans: Peace, Love, and Sunglasses are -
Workers concerns about automation
– As automation is fast increasing in the segment, Chilli Sunglasses 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.
Need for greater diversity
– Chilli Sunglasses 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 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 Chilli Sunglasses supply chain. Even after few cautionary changes mentioned in the HBR case study - Chilli Beans: Peace, Love, and Sunglasses, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Chilli Sunglasses vulnerable to further global disruptions in South East Asia.
High cash cycle compare to competitors
Chilli Sunglasses 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.
Slow decision making process
– As mentioned earlier in the report, Chilli Sunglasses 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. Chilli Sunglasses 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Chilli Beans: Peace, Love, and Sunglasses, is just above the industry average. Chilli Sunglasses 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 harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Chilli Sunglasses is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Chilli Beans: Peace, Love, and Sunglasses can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Chilli Beans: Peace, Love, and Sunglasses, in the dynamic environment Chilli Sunglasses has struggled to respond to the nimble upstart competition. Chilli Sunglasses has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Products dominated business model
– Even though Chilli Sunglasses 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 - Chilli Beans: Peace, Love, and Sunglasses should strive to include more intangible value offerings along with its core products and services.
No frontier risks strategy
– After analyzing the HBR case study Chilli Beans: Peace, Love, and Sunglasses, 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.
Aligning sales with marketing
– It come across in the case study Chilli Beans: Peace, Love, and Sunglasses 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 Chilli Beans: Peace, Love, and Sunglasses can leverage the sales team experience to cultivate customer relationships as Chilli Sunglasses is planning to shift buying processes online.
Opportunities Chilli Beans: Peace, Love, and Sunglasses | 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 Chilli Beans: Peace, Love, and Sunglasses are -
Manufacturing automation
– Chilli Sunglasses 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Chilli Sunglasses can use these opportunities to build new business models that can help the communities that Chilli Sunglasses operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Chilli Sunglasses is facing challenges because of the dominance of functional experts in the organization. Chilli Beans: Peace, Love, and Sunglasses 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
– Chilli Sunglasses 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.
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 Chilli Sunglasses in the consumer business. Now Chilli Sunglasses can target international markets with far fewer capital restrictions requirements than the existing system.
Learning at scale
– Online learning technologies has now opened space for Chilli Sunglasses 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Chilli Sunglasses 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Chilli Sunglasses 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 Chilli Sunglasses to hire the very best people irrespective of their geographical location.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Chilli Sunglasses 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 Chilli Sunglasses 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Chilli Sunglasses 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, Chilli Sunglasses 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, Chilli Beans: Peace, Love, and Sunglasses, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Building a culture of innovation
– managers at Chilli Sunglasses 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.
Threats Chilli Beans: Peace, Love, and Sunglasses External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Chilli Beans: Peace, Love, and Sunglasses are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Chilli Beans: Peace, Love, and Sunglasses, Chilli Sunglasses 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 .
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 Chilli Sunglasses 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.
Consumer confidence and its impact on Chilli Sunglasses 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.
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.
Shortening product life cycle
– it is one of the major threat that Chilli Sunglasses is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Chilli Sunglasses can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Chilli Sunglasses 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 Chilli Sunglasses.
Technology acceleration in Forth Industrial Revolution
– Chilli Sunglasses has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Chilli Sunglasses 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Chilli Sunglasses with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Environmental challenges
– Chilli Sunglasses 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. Chilli Sunglasses can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
High dependence on third party suppliers
– Chilli Sunglasses 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.
Weighted SWOT Analysis of Chilli Beans: Peace, Love, and Sunglasses 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 Chilli Beans: Peace, Love, and Sunglasses 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 Chilli Beans: Peace, Love, and Sunglasses 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 Chilli Beans: Peace, Love, and Sunglasses 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 Chilli Beans: Peace, Love, and Sunglasses 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 Chilli Sunglasses needs to make to build a sustainable competitive advantage.