Limits to Growing Customer Value: Being Squeezed Between the Past and the Future SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Limits to Growing Customer Value: Being Squeezed Between the Past and the Future
Marketing managers often have to balance between marketing exploitation strategies (reaping value from what already is known) and marketing exploration strategies (reaping value from new sources). However, do marketing strategies once exploited or explored in a certain way or direction leave enough potential for further exploration? Based on the various cases of Apple, Alpro, Intel, Nutella, Patagonia, and Ryanair, this article shows that several risks and limits come into play when trying to answer this question. Companies may get squeezed between the past and the future while facing the pressure of temporal consistency driven by past behavior and experiencing the limits of future growth in the dominant customer value drivers. To counter this problem, companies often start integrating new value drivers in their story, leading to other risks, such as incompatibility with existing drivers. The cases discussed in this article reveal that companies may have to accept more sacrifices in order to increase returns within their growth trajectory. Value engineering will become a crucial discipline for companies to survive in many industries. This article gives a step-by-step approach on how to implement this in an organization.
Swot Analysis of "Limits to Growing Customer Value: Being Squeezed Between the Past and the Future" written by Marc Logman includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Reaping Limits facing as an external strategic factors. Some of the topics covered in Limits to Growing Customer Value: Being Squeezed Between the Past and the Future case study are - Strategic Management Strategies, and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Limits to Growing Customer Value: Being Squeezed Between the Past and the Future casestudy better are - – increasing commodity prices, there is increasing trade war between United States & China, supply chains are disrupted by pandemic , increasing inequality as vast percentage of new income is going to the top 1%, 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,
increasing transportation and logistics costs, technology disruption, etc
Introduction to SWOT Analysis of Limits to Growing Customer Value: Being Squeezed Between the Past and the Future
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Limits to Growing Customer Value: Being Squeezed Between the Past and the Future case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Reaping Limits, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Reaping Limits 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 Limits to Growing Customer Value: Being Squeezed Between the Past and the Future can be done for the following purposes –
1. Strategic planning using facts provided in Limits to Growing Customer Value: Being Squeezed Between the Past and the Future case study
2. Improving business portfolio management of Reaping Limits
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 Reaping Limits
Strengths Limits to Growing Customer Value: Being Squeezed Between the Past and the Future | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Reaping Limits in Limits to Growing Customer Value: Being Squeezed Between the Past and the Future Harvard Business Review case study are -
Superior customer experience
– The customer experience strategy of Reaping Limits in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to lead change in Sales & Marketing field
– Reaping Limits 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 Reaping Limits in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High switching costs
– The high switching costs that Reaping Limits 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.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Reaping Limits digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Reaping Limits has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Analytics focus
– Reaping Limits 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 Marc Logman 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.
Ability to recruit top talent
– Reaping Limits is one of the leading recruiters in the industry. Managers in the Limits to Growing Customer Value: Being Squeezed Between the Past and the Future are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Cross disciplinary teams
– Horizontal connected teams at the Reaping Limits 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.
Learning organization
- Reaping Limits 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 Reaping Limits is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Limits to Growing Customer Value: Being Squeezed Between the Past and the Future Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Successful track record of launching new products
– Reaping Limits has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Reaping Limits 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 Reaping Limits
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Reaping Limits does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Low bargaining power of suppliers
– Suppliers of Reaping Limits in the sector have low bargaining power. Limits to Growing Customer Value: Being Squeezed Between the Past and the Future has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Reaping Limits to manage not only supply disruptions but also source products at highly competitive prices.
Innovation driven organization
– Reaping Limits is one of the most innovative firm in sector. Manager in Limits to Growing Customer Value: Being Squeezed Between the Past and the Future Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Weaknesses Limits to Growing Customer Value: Being Squeezed Between the Past and the Future | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Limits to Growing Customer Value: Being Squeezed Between the Past and the Future are -
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Limits to Growing Customer Value: Being Squeezed Between the Past and the Future, it seems that the employees of Reaping Limits 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Reaping Limits is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Limits to Growing Customer Value: Being Squeezed Between the Past and the Future 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 Limits to Growing Customer Value: Being Squeezed Between the Past and the Future 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 Reaping Limits has relatively successful track record of launching new products.
Skills based hiring
– The stress on hiring functional specialists at Reaping Limits has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Workers concerns about automation
– As automation is fast increasing in the segment, Reaping Limits 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 Reaping Limits, firm in the HBR case study Limits to Growing Customer Value: Being Squeezed Between the Past and the Future needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Lack of clear differentiation of Reaping Limits products
– To increase the profitability and margins on the products, Reaping Limits needs to provide more differentiated products than what it is currently offering in the marketplace.
Increasing silos among functional specialists
– The organizational structure of Reaping Limits is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Reaping Limits needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Reaping Limits to focus more on services rather than just following the product oriented approach.
Need for greater diversity
– Reaping Limits 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.
Slow decision making process
– As mentioned earlier in the report, Reaping Limits 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. Reaping Limits 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.
Interest costs
– Compare to the competition, Reaping Limits 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.
Opportunities Limits to Growing Customer Value: Being Squeezed Between the Past and the Future | 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 Limits to Growing Customer Value: Being Squeezed Between the Past and the Future are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Reaping Limits 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, Limits to Growing Customer Value: Being Squeezed Between the Past and the Future, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Buying journey improvements
– Reaping Limits can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Limits to Growing Customer Value: Being Squeezed Between the Past and the Future 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Sales & Marketing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Reaping Limits can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Reaping Limits can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
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 Reaping Limits 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.
Leveraging digital technologies
– Reaping Limits 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Reaping Limits can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Manufacturing automation
– Reaping Limits 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, Reaping Limits can use these opportunities to build new business models that can help the communities that Reaping Limits operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Developing new processes and practices
– Reaping Limits 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, Reaping Limits is facing challenges because of the dominance of functional experts in the organization. Limits to Growing Customer Value: Being Squeezed Between the Past and the Future 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.
Creating value in data economy
– The success of analytics program of Reaping Limits has opened avenues for new revenue streams for the organization in the industry. This can help Reaping Limits to build a more holistic ecosystem as suggested in the Limits to Growing Customer Value: Being Squeezed Between the Past and the Future case study. Reaping Limits can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at Reaping Limits 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.
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. Reaping Limits can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats Limits to Growing Customer Value: Being Squeezed Between the Past and the Future External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Limits to Growing Customer Value: Being Squeezed Between the Past and the Future are -
Technology acceleration in Forth Industrial Revolution
– Reaping Limits has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Reaping Limits 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.
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 Reaping Limits.
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 Reaping Limits business can come under increasing regulations regarding data privacy, data security, etc.
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. Reaping Limits 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.
Shortening product life cycle
– it is one of the major threat that Reaping Limits is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Reaping Limits needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Reaping Limits 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.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Limits to Growing Customer Value: Being Squeezed Between the Past and the Future, Reaping Limits 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 .
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 Reaping Limits in the Sales & Marketing sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Reaping Limits high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Consumer confidence and its impact on Reaping Limits 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.
Regulatory challenges
– Reaping Limits 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.
Weighted SWOT Analysis of Limits to Growing Customer Value: Being Squeezed Between the Past and the Future 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 Limits to Growing Customer Value: Being Squeezed Between the Past and the Future 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 Limits to Growing Customer Value: Being Squeezed Between the Past and the Future 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 Limits to Growing Customer Value: Being Squeezed Between the Past and the Future 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 Limits to Growing Customer Value: Being Squeezed Between the Past and the Future 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 Reaping Limits needs to make to build a sustainable competitive advantage.