Case Study Description of Lakshmi Projects: Sales Structure Dilemma
In July 2014, the managing director of Lakshmi Projects in Delhi, India, finds himself struggling with the marketing and sales strategy for the year ahead. Founded in 1997, the company specializes in offering turnkey solutions for bulk material handling systems for industries in the fast-growing infrastructure segment of the Indian economy; its two main product categories are elevator and conveyor systems. Yet, the company was failing to meet its sales targets, largely due to an overextended and underachieving salesforce. What was the right structure for the sales, after-sales and quality teams in the organization? An additional concern was that a sales strategy for the company's new product, set to launch in October 2014, had not yet been decided. Fluctuating industry dynamics, financial strains, field sales and service requirements meant that this was a complex decision that held larger consequences for the company's future.
Authors :: Sandeep Puri, Mehmet Begen, Akshay Nangia, Arjit Rawal
Swot Analysis of "Lakshmi Projects: Sales Structure Dilemma" written by Sandeep Puri, Mehmet Begen, Akshay Nangia, Arjit Rawal includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Lakshmi Sales facing as an external strategic factors. Some of the topics covered in Lakshmi Projects: Sales Structure Dilemma case study are - Strategic Management Strategies, Sales and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Lakshmi Projects: Sales Structure Dilemma casestudy better are - – geopolitical disruptions, increasing inequality as vast percentage of new income is going to the top 1%, challanges to central banks by blockchain based private currencies, increasing household debt because of falling income levels, there is backlash against globalization, talent flight as more people leaving formal jobs, cloud computing is disrupting traditional business models,
digital marketing is dominated by two big players Facebook and Google, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of Lakshmi Projects: Sales Structure Dilemma
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Lakshmi Projects: Sales Structure Dilemma case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Lakshmi Sales, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Lakshmi Sales 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 Lakshmi Projects: Sales Structure Dilemma can be done for the following purposes –
1. Strategic planning using facts provided in Lakshmi Projects: Sales Structure Dilemma case study
2. Improving business portfolio management of Lakshmi Sales
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 Lakshmi Sales
Strengths Lakshmi Projects: Sales Structure Dilemma | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Lakshmi Sales in Lakshmi Projects: Sales Structure Dilemma Harvard Business Review case study are -
Superior customer experience
– The customer experience strategy of Lakshmi Sales in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Innovation driven organization
– Lakshmi Sales is one of the most innovative firm in sector. Manager in Lakshmi Projects: Sales Structure Dilemma Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Highly skilled collaborators
– Lakshmi Sales 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 Lakshmi Projects: Sales Structure Dilemma HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Strong track record of project management
– Lakshmi Sales is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Sustainable margins compare to other players in Sales & Marketing industry
– Lakshmi Projects: Sales Structure Dilemma firm has clearly differentiated products in the market place. This has enabled Lakshmi Sales to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Lakshmi Sales to invest into research and development (R&D) and innovation.
Training and development
– Lakshmi Sales has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Lakshmi Projects: Sales Structure Dilemma 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.
Low bargaining power of suppliers
– Suppliers of Lakshmi Sales in the sector have low bargaining power. Lakshmi Projects: Sales Structure Dilemma has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Lakshmi Sales to manage not only supply disruptions but also source products at highly competitive prices.
Cross disciplinary teams
– Horizontal connected teams at the Lakshmi Sales 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.
Diverse revenue streams
– Lakshmi Sales is present in almost all the verticals within the industry. This has provided firm in Lakshmi Projects: Sales Structure Dilemma 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.
Successful track record of launching new products
– Lakshmi Sales has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Lakshmi Sales 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.
Organizational Resilience of Lakshmi Sales
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Lakshmi Sales does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Effective Research and Development (R&D)
– Lakshmi Sales 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 Lakshmi Projects: Sales Structure Dilemma - 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 Lakshmi Projects: Sales Structure Dilemma | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Lakshmi Projects: Sales Structure Dilemma are -
High bargaining power of channel partners
– Because of the regulatory requirements, Sandeep Puri, Mehmet Begen, Akshay Nangia, Arjit Rawal suggests that, Lakshmi Sales is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Increasing silos among functional specialists
– The organizational structure of Lakshmi Sales is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Lakshmi Sales needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Lakshmi Sales to focus more on services rather than just following the product oriented approach.
Low market penetration in new markets
– Outside its home market of Lakshmi Sales, firm in the HBR case study Lakshmi Projects: Sales Structure Dilemma needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
No frontier risks strategy
– After analyzing the HBR case study Lakshmi Projects: Sales Structure Dilemma, 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, Lakshmi Sales 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. Lakshmi Sales even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Capital Spending Reduction
– Even during the low interest decade, Lakshmi Sales 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Lakshmi Projects: Sales Structure Dilemma, is just above the industry average. Lakshmi Sales 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 Lakshmi Projects: Sales Structure Dilemma HBR case study mentions - Lakshmi Sales 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.
Lack of clear differentiation of Lakshmi Sales products
– To increase the profitability and margins on the products, Lakshmi Sales needs to provide more differentiated products than what it is currently offering in the marketplace.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Lakshmi Projects: Sales Structure Dilemma, it seems that the employees of Lakshmi Sales don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Lakshmi Projects: Sales Structure Dilemma 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 Lakshmi Sales has relatively successful track record of launching new products.
Opportunities Lakshmi Projects: Sales Structure Dilemma | 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 Lakshmi Projects: Sales Structure Dilemma are -
Developing new processes and practices
– Lakshmi Sales 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Lakshmi Sales is facing challenges because of the dominance of functional experts in the organization. Lakshmi Projects: Sales Structure Dilemma 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.
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 Lakshmi Sales in the consumer business. Now Lakshmi Sales can target international markets with far fewer capital restrictions requirements than the existing system.
Using analytics as competitive advantage
– Lakshmi Sales 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 Lakshmi Projects: Sales Structure Dilemma - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Lakshmi Sales to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Loyalty marketing
– Lakshmi Sales has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
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. Lakshmi Sales 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, Lakshmi Sales can use these opportunities to build new business models that can help the communities that Lakshmi Sales operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Better consumer reach
– The expansion of the 5G network will help Lakshmi Sales to increase its market reach. Lakshmi Sales 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.
Leveraging digital technologies
– Lakshmi Sales 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Lakshmi Sales 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 Lakshmi Sales to hire the very best people irrespective of their geographical location.
Buying journey improvements
– Lakshmi Sales can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Lakshmi Projects: Sales Structure Dilemma 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.
Learning at scale
– Online learning technologies has now opened space for Lakshmi Sales 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.
Building a culture of innovation
– managers at Lakshmi Sales 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 Lakshmi Projects: Sales Structure Dilemma External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Lakshmi Projects: Sales Structure Dilemma are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Lakshmi Sales 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 Lakshmi Projects: Sales Structure Dilemma .
Regulatory challenges
– Lakshmi Sales 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.
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 Lakshmi Sales.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Lakshmi Sales 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.
High dependence on third party suppliers
– Lakshmi Sales 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.
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. Lakshmi Sales can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing wage structure of Lakshmi Sales
– 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 Lakshmi Sales.
Stagnating economy with rate increase
– Lakshmi Sales 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Lakshmi Sales with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Lakshmi Projects: Sales Structure Dilemma, Lakshmi Sales 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 .
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. Lakshmi Sales needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Shortening product life cycle
– it is one of the major threat that Lakshmi Sales is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Lakshmi Projects: Sales Structure Dilemma 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 Lakshmi Projects: Sales Structure Dilemma 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 Lakshmi Projects: Sales Structure Dilemma 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 Lakshmi Projects: Sales Structure Dilemma 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 Lakshmi Projects: Sales Structure Dilemma 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 Lakshmi Sales needs to make to build a sustainable competitive advantage.