Case Study Description of Vanity Fair Mills: Market Response System
Describes the "Quick Response" program developed by Vanity Fair Mills (VFM), a division of the VF Corp. Beginning in 1989, VFM reorganized its manufacturing systems, invested heavily in computer and telecommunications equipment, and formed "partnership" agreements with major retailers. These changes were designed to improve inventory turnover, reduce markdowns, and cut down on operating expenses in the distribution of intimate apparel. The improved efficiency of the distribution channel would, it was believed, yield benefits for VFM and its retail customers. In early 1993 VFM management reviewed their progress to date in implementing Quick Response.
Swot Analysis of "Vanity Fair Mills: Market Response System" written by Robert D. Buzzell includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Vfm Vanity facing as an external strategic factors. Some of the topics covered in Vanity Fair Mills: Market Response System case study are - Strategic Management Strategies, Marketing, Operations management, Sales and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Vanity Fair Mills: Market Response System casestudy better are - – talent flight as more people leaving formal jobs, supply chains are disrupted by pandemic , there is backlash against globalization, challanges to central banks by blockchain based private currencies, increasing household debt because of falling income levels, digital marketing is dominated by two big players Facebook and Google, wage bills are increasing,
increasing inequality as vast percentage of new income is going to the top 1%, banking and financial system is disrupted by Bitcoin and other crypto currencies, etc
Introduction to SWOT Analysis of Vanity Fair Mills: Market Response System
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Vanity Fair Mills: Market Response System case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Vfm Vanity, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Vfm Vanity 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 Vanity Fair Mills: Market Response System can be done for the following purposes –
1. Strategic planning using facts provided in Vanity Fair Mills: Market Response System case study
2. Improving business portfolio management of Vfm Vanity
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 Vfm Vanity
Strengths Vanity Fair Mills: Market Response System | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Vfm Vanity in Vanity Fair Mills: Market Response System Harvard Business Review case study are -
Learning organization
- Vfm Vanity is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Vfm Vanity is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Vanity Fair Mills: Market Response System Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Vfm Vanity 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
– Vfm Vanity is one of the most innovative firm in sector. Manager in Vanity Fair Mills: Market Response System 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
– Vfm Vanity 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 Vanity Fair Mills: Market Response System HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High brand equity
– Vfm Vanity has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Vfm Vanity to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Analytics focus
– Vfm Vanity 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 Robert D. Buzzell 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.
Sustainable margins compare to other players in Sales & Marketing industry
– Vanity Fair Mills: Market Response System firm has clearly differentiated products in the market place. This has enabled Vfm Vanity to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Vfm Vanity to invest into research and development (R&D) and innovation.
Effective Research and Development (R&D)
– Vfm Vanity 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 Vanity Fair Mills: Market Response System - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Low bargaining power of suppliers
– Suppliers of Vfm Vanity in the sector have low bargaining power. Vanity Fair Mills: Market Response System has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Vfm Vanity to manage not only supply disruptions but also source products at highly competitive prices.
Organizational Resilience of Vfm Vanity
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Vfm Vanity does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High switching costs
– The high switching costs that Vfm Vanity 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.
Ability to recruit top talent
– Vfm Vanity is one of the leading recruiters in the industry. Managers in the Vanity Fair Mills: Market Response System are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Weaknesses Vanity Fair Mills: Market Response System | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Vanity Fair Mills: Market Response System are -
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Vanity Fair Mills: Market Response System, it seems that the employees of Vfm Vanity 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 Vanity Fair Mills: Market Response System 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 Vfm Vanity has relatively successful track record of launching new products.
Interest costs
– Compare to the competition, Vfm Vanity 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Vfm Vanity 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.
Lack of clear differentiation of Vfm Vanity products
– To increase the profitability and margins on the products, Vfm Vanity needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Vfm Vanity 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.
Aligning sales with marketing
– It come across in the case study Vanity Fair Mills: Market Response System 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 Vanity Fair Mills: Market Response System can leverage the sales team experience to cultivate customer relationships as Vfm Vanity is planning to shift buying processes online.
High operating costs
– Compare to the competitors, firm in the HBR case study Vanity Fair Mills: Market Response System has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Vfm Vanity 's lucrative customers.
Products dominated business model
– Even though Vfm Vanity 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 - Vanity Fair Mills: Market Response System should strive to include more intangible value offerings along with its core products and services.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Vfm Vanity is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Vanity Fair Mills: Market Response System 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 Vanity Fair Mills: Market Response System, in the dynamic environment Vfm Vanity has struggled to respond to the nimble upstart competition. Vfm Vanity has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Opportunities Vanity Fair Mills: Market Response System | 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 Vanity Fair Mills: Market Response System are -
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 Vfm Vanity in the consumer business. Now Vfm Vanity can target international markets with far fewer capital restrictions requirements than the existing system.
Manufacturing automation
– Vfm Vanity 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.
Learning at scale
– Online learning technologies has now opened space for Vfm Vanity 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.
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. Vfm Vanity can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Loyalty marketing
– Vfm Vanity 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.
Leveraging digital technologies
– Vfm Vanity 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Vfm Vanity 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, Vanity Fair Mills: Market Response System, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Vfm Vanity 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.
Better consumer reach
– The expansion of the 5G network will help Vfm Vanity to increase its market reach. Vfm Vanity 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Vfm Vanity can use these opportunities to build new business models that can help the communities that Vfm Vanity operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Building a culture of innovation
– managers at Vfm Vanity 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Vfm Vanity 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.
Creating value in data economy
– The success of analytics program of Vfm Vanity has opened avenues for new revenue streams for the organization in the industry. This can help Vfm Vanity to build a more holistic ecosystem as suggested in the Vanity Fair Mills: Market Response System case study. Vfm Vanity can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats Vanity Fair Mills: Market Response System External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Vanity Fair Mills: Market Response System 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 Vanity Fair Mills: Market Response System, Vfm Vanity 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. Vfm Vanity needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Vfm Vanity 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 Vanity Fair Mills: Market Response System .
Regulatory challenges
– Vfm Vanity 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.
Technology acceleration in Forth Industrial Revolution
– Vfm Vanity has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Vfm Vanity 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 Vfm Vanity with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Vfm Vanity will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
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.
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 Vfm Vanity.
Shortening product life cycle
– it is one of the major threat that Vfm Vanity is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Vfm Vanity in the Sales & Marketing sector and impact the bottomline of the organization.
Stagnating economy with rate increase
– Vfm Vanity 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.
Environmental challenges
– Vfm Vanity 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. Vfm Vanity can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Weighted SWOT Analysis of Vanity Fair Mills: Market Response System 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 Vanity Fair Mills: Market Response System 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 Vanity Fair Mills: Market Response System 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 Vanity Fair Mills: Market Response System 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 Vanity Fair Mills: Market Response System 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 Vfm Vanity needs to make to build a sustainable competitive advantage.
