Case Study Description of Janalakshmi Financial Services' HR Dilemma
V. S. Radhakrishan, CEO of Janalakshmi Financial Services, one of India's largest urban microfinance organizations, was facing an HR dilemma. The sales force at JFS's biggest division, Retail Financial Services, which focused on the distribution of small group-based loans, was experiencing declining productivity, and a high and above-market attrition rate. Radhakrishnan knew that as a microfinance institution, JFS's success rested on the performance of its salespeople. He had directed HR to undertake a thorough review of the existing salesforce compensation scheme, and devise changes that would both inculcate a performance-oriented culture, and lower the attrition rate. He had also asked HR to find ways to align the incentives of salespeople with the firm's social mission of serving the urban poor. HR had proposed several changes to compensation policy, but Radhakrishnan was unconvinced about many of the recommendations. He needed to make quick decisions; he had to present his views on HR policy changes to the company's board of directors in a few hours.
Swot Analysis of "Janalakshmi Financial Services' HR Dilemma" written by Doug J. Chung, Radhika Kak includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Hr Janalakshmi facing as an external strategic factors. Some of the topics covered in Janalakshmi Financial Services' HR Dilemma case study are - Strategic Management Strategies, Employee retention, Entrepreneurial finance, Marketing, Personnel policies, Sales and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Janalakshmi Financial Services' HR Dilemma casestudy better are - – increasing energy prices, central banks are concerned over increasing inflation, customer relationship management is fast transforming because of increasing concerns over data privacy, there is increasing trade war between United States & China, digital marketing is dominated by two big players Facebook and Google, increasing government debt because of Covid-19 spendings, competitive advantages are harder to sustain because of technology dispersion,
increasing transportation and logistics costs, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Janalakshmi Financial Services' HR Dilemma
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Janalakshmi Financial Services' HR Dilemma case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Hr Janalakshmi, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Hr Janalakshmi 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 Janalakshmi Financial Services' HR Dilemma can be done for the following purposes –
1. Strategic planning using facts provided in Janalakshmi Financial Services' HR Dilemma case study
2. Improving business portfolio management of Hr Janalakshmi
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 Hr Janalakshmi
Strengths Janalakshmi Financial Services' HR Dilemma | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Hr Janalakshmi in Janalakshmi Financial Services' HR Dilemma Harvard Business Review case study are -
High brand equity
– Hr Janalakshmi has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Hr Janalakshmi to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Successful track record of launching new products
– Hr Janalakshmi has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Hr Janalakshmi 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.
Strong track record of project management
– Hr Janalakshmi 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 Hr Janalakshmi in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Operational resilience
– The operational resilience strategy in the Janalakshmi Financial Services' HR Dilemma 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.
High switching costs
– The high switching costs that Hr Janalakshmi 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.
Effective Research and Development (R&D)
– Hr Janalakshmi 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 Janalakshmi Financial Services' HR 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.
Ability to recruit top talent
– Hr Janalakshmi is one of the leading recruiters in the industry. Managers in the Janalakshmi Financial Services' HR Dilemma are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Innovation driven organization
– Hr Janalakshmi is one of the most innovative firm in sector. Manager in Janalakshmi Financial Services' HR Dilemma Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Low bargaining power of suppliers
– Suppliers of Hr Janalakshmi in the sector have low bargaining power. Janalakshmi Financial Services' HR Dilemma has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Hr Janalakshmi to manage not only supply disruptions but also source products at highly competitive prices.
Training and development
– Hr Janalakshmi has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Janalakshmi Financial Services' HR 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.
Learning organization
- Hr Janalakshmi 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 Hr Janalakshmi is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Janalakshmi Financial Services' HR Dilemma Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses Janalakshmi Financial Services' HR Dilemma | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Janalakshmi Financial Services' HR Dilemma are -
Slow decision making process
– As mentioned earlier in the report, Hr Janalakshmi 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. Hr Janalakshmi 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Hr Janalakshmi 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.
Low market penetration in new markets
– Outside its home market of Hr Janalakshmi, firm in the HBR case study Janalakshmi Financial Services' HR Dilemma needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High bargaining power of channel partners
– Because of the regulatory requirements, Doug J. Chung, Radhika Kak suggests that, Hr Janalakshmi 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Hr Janalakshmi is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Janalakshmi Financial Services' HR Dilemma can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Janalakshmi Financial Services' HR 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 Hr Janalakshmi has relatively successful track record of launching new products.
Slow to strategic competitive environment developments
– As Janalakshmi Financial Services' HR Dilemma HBR case study mentions - Hr Janalakshmi 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.
Products dominated business model
– Even though Hr Janalakshmi 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 - Janalakshmi Financial Services' HR Dilemma should strive to include more intangible value offerings along with its core products and services.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Janalakshmi Financial Services' HR Dilemma, in the dynamic environment Hr Janalakshmi has struggled to respond to the nimble upstart competition. Hr Janalakshmi has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
No frontier risks strategy
– After analyzing the HBR case study Janalakshmi Financial Services' HR 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Janalakshmi Financial Services' HR Dilemma, it seems that the employees of Hr Janalakshmi 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.
Opportunities Janalakshmi Financial Services' HR 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 Janalakshmi Financial Services' HR Dilemma are -
Learning at scale
– Online learning technologies has now opened space for Hr Janalakshmi 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, Hr Janalakshmi 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 Hr Janalakshmi 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 Hr Janalakshmi to hire the very best people irrespective of their geographical location.
Creating value in data economy
– The success of analytics program of Hr Janalakshmi has opened avenues for new revenue streams for the organization in the industry. This can help Hr Janalakshmi to build a more holistic ecosystem as suggested in the Janalakshmi Financial Services' HR Dilemma case study. Hr Janalakshmi can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Leveraging digital technologies
– Hr Janalakshmi 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Hr Janalakshmi can use these opportunities to build new business models that can help the communities that Hr Janalakshmi operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Hr Janalakshmi can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Hr Janalakshmi can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Hr Janalakshmi is facing challenges because of the dominance of functional experts in the organization. Janalakshmi Financial Services' HR 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.
Loyalty marketing
– Hr Janalakshmi 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Hr Janalakshmi 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.
Building a culture of innovation
– managers at Hr Janalakshmi 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.
Using analytics as competitive advantage
– Hr Janalakshmi 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 Janalakshmi Financial Services' HR Dilemma - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Hr Janalakshmi to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Janalakshmi Financial Services' HR Dilemma External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Janalakshmi Financial Services' HR Dilemma are -
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 Hr Janalakshmi in the Sales & Marketing sector and impact the bottomline of the organization.
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.
Consumer confidence and its impact on Hr Janalakshmi 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.
Shortening product life cycle
– it is one of the major threat that Hr Janalakshmi is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, 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 Hr Janalakshmi.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Hr Janalakshmi with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Regulatory challenges
– Hr Janalakshmi 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Janalakshmi Financial Services' HR Dilemma, Hr Janalakshmi 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 .
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. Hr Janalakshmi 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Hr Janalakshmi 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.
Stagnating economy with rate increase
– Hr Janalakshmi 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 acceleration in Forth Industrial Revolution
– Hr Janalakshmi has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Hr Janalakshmi 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.
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. Hr Janalakshmi can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of Janalakshmi Financial Services' HR 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 Janalakshmi Financial Services' HR 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 Janalakshmi Financial Services' HR 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 Janalakshmi Financial Services' HR 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 Janalakshmi Financial Services' HR 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 Hr Janalakshmi needs to make to build a sustainable competitive advantage.