Swot Analysis of "Chilli Beans: Peace, Love, and Sunglasses" written by Jose B. Alvarez, Robert Mackalski, Andrew Otazo includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Chilli Sunglasses facing as an external strategic factors. Some of the topics covered in Chilli Beans: Peace, Love, and Sunglasses case study are - Strategic Management Strategies, Design, Entrepreneurship, Financial markets, Growth strategy, International business, Leadership, Manufacturing, Organizational culture, Supply chain and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Chilli Beans: Peace, Love, and Sunglasses casestudy better are - – there is backlash against globalization, competitive advantages are harder to sustain because of technology dispersion, wage bills are increasing, challanges to central banks by blockchain based private currencies, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing transportation and logistics costs, increasing commodity prices,
increasing inequality as vast percentage of new income is going to the top 1%, technology disruption, etc
Introduction to SWOT Analysis of Chilli Beans: Peace, Love, and Sunglasses
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Chilli Beans: Peace, Love, and Sunglasses case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Chilli Sunglasses, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Chilli Sunglasses operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Chilli Beans: Peace, Love, and Sunglasses can be done for the following purposes –
1. Strategic planning using facts provided in Chilli Beans: Peace, Love, and Sunglasses case study
2. Improving business portfolio management of Chilli Sunglasses
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Chilli Sunglasses
Strengths Chilli Beans: Peace, Love, and Sunglasses | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Chilli Sunglasses in Chilli Beans: Peace, Love, and Sunglasses Harvard Business Review case study are -
Ability to lead change in Sales & Marketing field
– Chilli Sunglasses is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Chilli Sunglasses in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Strong track record of project management
– Chilli Sunglasses is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Chilli Sunglasses digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Chilli Sunglasses has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Learning organization
- Chilli Sunglasses 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 Chilli Sunglasses is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Chilli Beans: Peace, Love, and Sunglasses Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– Chilli Sunglasses is one of the leading recruiters in the industry. Managers in the Chilli Beans: Peace, Love, and Sunglasses are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Organizational Resilience of Chilli Sunglasses
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Chilli Sunglasses does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Sustainable margins compare to other players in Sales & Marketing industry
– Chilli Beans: Peace, Love, and Sunglasses firm has clearly differentiated products in the market place. This has enabled Chilli Sunglasses to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Chilli Sunglasses to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– Chilli Sunglasses has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Chilli Beans: Peace, Love, and Sunglasses HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High switching costs
– The high switching costs that Chilli Sunglasses 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.
Innovation driven organization
– Chilli Sunglasses is one of the most innovative firm in sector. Manager in Chilli Beans: Peace, Love, and Sunglasses Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Low bargaining power of suppliers
– Suppliers of Chilli Sunglasses in the sector have low bargaining power. Chilli Beans: Peace, Love, and Sunglasses has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Chilli Sunglasses to manage not only supply disruptions but also source products at highly competitive prices.
Cross disciplinary teams
– Horizontal connected teams at the Chilli Sunglasses 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.
Weaknesses Chilli Beans: Peace, Love, and Sunglasses | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Chilli Beans: Peace, Love, and Sunglasses are -
Increasing silos among functional specialists
– The organizational structure of Chilli Sunglasses is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Chilli Sunglasses needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Chilli Sunglasses to focus more on services rather than just following the product oriented approach.
Lack of clear differentiation of Chilli Sunglasses products
– To increase the profitability and margins on the products, Chilli Sunglasses needs to provide more differentiated products than what it is currently offering in the marketplace.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Chilli Beans: Peace, Love, and Sunglasses, is just above the industry average. Chilli Sunglasses needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Capital Spending Reduction
– Even during the low interest decade, Chilli Sunglasses 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.
Slow to strategic competitive environment developments
– As Chilli Beans: Peace, Love, and Sunglasses HBR case study mentions - Chilli Sunglasses 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.
Low market penetration in new markets
– Outside its home market of Chilli Sunglasses, firm in the HBR case study Chilli Beans: Peace, Love, and Sunglasses needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Skills based hiring
– The stress on hiring functional specialists at Chilli Sunglasses 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Chilli Sunglasses is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Chilli Beans: Peace, Love, and Sunglasses can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Slow decision making process
– As mentioned earlier in the report, Chilli Sunglasses has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Chilli Sunglasses even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
High operating costs
– Compare to the competitors, firm in the HBR case study Chilli Beans: Peace, Love, and Sunglasses 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 Chilli Sunglasses 's lucrative customers.
No frontier risks strategy
– After analyzing the HBR case study Chilli Beans: Peace, Love, and Sunglasses, it seems that company is thinking about the frontier risks that can impact Sales & Marketing strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Opportunities Chilli Beans: Peace, Love, and Sunglasses | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Chilli Beans: Peace, Love, and Sunglasses are -
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Chilli Sunglasses to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Developing new processes and practices
– Chilli Sunglasses 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.
Better consumer reach
– The expansion of the 5G network will help Chilli Sunglasses to increase its market reach. Chilli Sunglasses 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.
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. Chilli Sunglasses 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. Chilli Sunglasses 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.
Leveraging digital technologies
– Chilli Sunglasses can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Chilli Sunglasses is facing challenges because of the dominance of functional experts in the organization. Chilli Beans: Peace, Love, and Sunglasses case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Loyalty marketing
– Chilli Sunglasses 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.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Chilli Sunglasses in the consumer business. Now Chilli Sunglasses can target international markets with far fewer capital restrictions requirements than the existing system.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Chilli Sunglasses can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Chilli Sunglasses in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Sales & Marketing segment, and it will provide faster access to the consumers.
Building a culture of innovation
– managers at Chilli Sunglasses can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Sales & Marketing segment.
Buying journey improvements
– Chilli Sunglasses can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Chilli Beans: Peace, Love, and Sunglasses 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.
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. Chilli Sunglasses can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats Chilli Beans: Peace, Love, and Sunglasses External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Chilli Beans: Peace, Love, and Sunglasses are -
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.
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. Chilli Sunglasses 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, Chilli Sunglasses 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 Chilli Beans: Peace, Love, and Sunglasses .
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Chilli Sunglasses business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Chilli Sunglasses high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Chilli Beans: Peace, Love, and Sunglasses, Chilli Sunglasses may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Sales & Marketing .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Chilli Sunglasses in the Sales & Marketing industry. The Sales & Marketing industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Increasing wage structure of Chilli Sunglasses
– 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 Chilli Sunglasses.
Stagnating economy with rate increase
– Chilli Sunglasses 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.
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 Chilli Sunglasses in the Sales & Marketing sector and impact the bottomline of the organization.
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. Chilli Sunglasses 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.
Regulatory challenges
– Chilli Sunglasses 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.
Shortening product life cycle
– it is one of the major threat that Chilli Sunglasses is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Chilli Beans: Peace, Love, and Sunglasses Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Chilli Beans: Peace, Love, and Sunglasses needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Chilli Beans: Peace, Love, and Sunglasses is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Chilli Beans: Peace, Love, and Sunglasses is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Chilli Beans: Peace, Love, and Sunglasses is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Chilli Sunglasses needs to make to build a sustainable competitive advantage.
