Case Study Description of Selling CFLs at Wal-Mart, Epilogue
In early 2009, Wal-Mart executive Andy Barron realized the firm's lighting business was facing a challenge. After achieving a goal of selling 100 million compact fluorescent light (CFL) bulbs by the end of 2007, sales of the energy-efficient bulbs had started to plateau, leading to a dim outlook for 2009. Barron needed to examine what barriers might be keeping consumers from adopting more of the bulbs, which offer both cost savings and environmental benefits. In this 2-part case students study the historic price points and sales of CFL bulbs, Wal-Mart's 2007 promotion of CFL lighting, and research about consumer adoption of the bulbs in order to understand how the retailer might achieve its goals. The case asks: How can consumer habits be changed? How can new products overcome barriers to adoption? What can managers do to promote sales of new products, given human behavior where biases, values and emotions have an impact on the choices people make? How can economic theories explain consumer behavior as it occurs in the real world? The Epilogue to the first case asks students to discuss what developments occurred after the 2009 implementation and how they impacted CFL sales.
Swot Analysis of "Selling CFLs at Wal-Mart, Epilogue" written by Eric J. Johnson, Daniel M. Bartels includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Bulbs Cfl facing as an external strategic factors. Some of the topics covered in Selling CFLs at Wal-Mart, Epilogue case study are - Strategic Management Strategies, Sustainability and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Selling CFLs at Wal-Mart, Epilogue casestudy better are - – technology disruption, challanges to central banks by blockchain based private currencies, there is backlash against globalization, competitive advantages are harder to sustain because of technology dispersion, digital marketing is dominated by two big players Facebook and Google, central banks are concerned over increasing inflation, increasing transportation and logistics costs,
increasing household debt because of falling income levels, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Selling CFLs at Wal-Mart, Epilogue
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Selling CFLs at Wal-Mart, Epilogue case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Bulbs Cfl, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Bulbs Cfl 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 Selling CFLs at Wal-Mart, Epilogue can be done for the following purposes –
1. Strategic planning using facts provided in Selling CFLs at Wal-Mart, Epilogue case study
2. Improving business portfolio management of Bulbs Cfl
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 Bulbs Cfl
Strengths Selling CFLs at Wal-Mart, Epilogue | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Bulbs Cfl in Selling CFLs at Wal-Mart, Epilogue Harvard Business Review case study are -
Ability to lead change in Sales & Marketing field
– Bulbs Cfl 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 Bulbs Cfl in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Low bargaining power of suppliers
– Suppliers of Bulbs Cfl in the sector have low bargaining power. Selling CFLs at Wal-Mart, Epilogue has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Bulbs Cfl to manage not only supply disruptions but also source products at highly competitive prices.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Bulbs Cfl digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Bulbs Cfl 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.
Superior customer experience
– The customer experience strategy of Bulbs Cfl in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the Bulbs Cfl 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.
Sustainable margins compare to other players in Sales & Marketing industry
– Selling CFLs at Wal-Mart, Epilogue firm has clearly differentiated products in the market place. This has enabled Bulbs Cfl to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Bulbs Cfl to invest into research and development (R&D) and innovation.
Innovation driven organization
– Bulbs Cfl is one of the most innovative firm in sector. Manager in Selling CFLs at Wal-Mart, Epilogue Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Training and development
– Bulbs Cfl has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Selling CFLs at Wal-Mart, Epilogue 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.
Strong track record of project management
– Bulbs Cfl is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Diverse revenue streams
– Bulbs Cfl is present in almost all the verticals within the industry. This has provided firm in Selling CFLs at Wal-Mart, Epilogue case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Organizational Resilience of Bulbs Cfl
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Bulbs Cfl does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Effective Research and Development (R&D)
– Bulbs Cfl 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 Selling CFLs at Wal-Mart, Epilogue - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses Selling CFLs at Wal-Mart, Epilogue | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Selling CFLs at Wal-Mart, Epilogue are -
Slow to strategic competitive environment developments
– As Selling CFLs at Wal-Mart, Epilogue HBR case study mentions - Bulbs Cfl 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Selling CFLs at Wal-Mart, Epilogue, in the dynamic environment Bulbs Cfl has struggled to respond to the nimble upstart competition. Bulbs Cfl 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 Selling CFLs at Wal-Mart, Epilogue, it seems that company is thinking about the frontier risks that can impact Sales & Marketing strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Bulbs Cfl is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Selling CFLs at Wal-Mart, Epilogue can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Aligning sales with marketing
– It come across in the case study Selling CFLs at Wal-Mart, Epilogue 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 Selling CFLs at Wal-Mart, Epilogue can leverage the sales team experience to cultivate customer relationships as Bulbs Cfl is planning to shift buying processes online.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Selling CFLs at Wal-Mart, Epilogue 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 Bulbs Cfl has relatively successful track record of launching new products.
High operating costs
– Compare to the competitors, firm in the HBR case study Selling CFLs at Wal-Mart, Epilogue 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 Bulbs Cfl 's lucrative customers.
High cash cycle compare to competitors
Bulbs Cfl 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Selling CFLs at Wal-Mart, Epilogue, is just above the industry average. Bulbs Cfl 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Bulbs Cfl 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Eric J. Johnson, Daniel M. Bartels suggests that, Bulbs Cfl 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.
Opportunities Selling CFLs at Wal-Mart, Epilogue | 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 Selling CFLs at Wal-Mart, Epilogue are -
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. Bulbs Cfl can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Developing new processes and practices
– Bulbs Cfl 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.
Learning at scale
– Online learning technologies has now opened space for Bulbs Cfl 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Bulbs Cfl can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Building a culture of innovation
– managers at Bulbs Cfl 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.
Creating value in data economy
– The success of analytics program of Bulbs Cfl has opened avenues for new revenue streams for the organization in the industry. This can help Bulbs Cfl to build a more holistic ecosystem as suggested in the Selling CFLs at Wal-Mart, Epilogue case study. Bulbs Cfl can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Bulbs Cfl is facing challenges because of the dominance of functional experts in the organization. Selling CFLs at Wal-Mart, Epilogue 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Bulbs Cfl 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.
Buying journey improvements
– Bulbs Cfl can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Selling CFLs at Wal-Mart, Epilogue 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Bulbs Cfl can use these opportunities to build new business models that can help the communities that Bulbs Cfl operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Leveraging digital technologies
– Bulbs Cfl 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, Bulbs Cfl 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, Selling CFLs at Wal-Mart, Epilogue, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Loyalty marketing
– Bulbs Cfl 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.
Threats Selling CFLs at Wal-Mart, Epilogue External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Selling CFLs at Wal-Mart, Epilogue are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Bulbs Cfl 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.
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 Bulbs Cfl business can come under increasing regulations regarding data privacy, data security, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Bulbs Cfl 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 Selling CFLs at Wal-Mart, Epilogue .
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 Bulbs Cfl.
Increasing wage structure of Bulbs Cfl
– 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 Bulbs Cfl.
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. Bulbs Cfl needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
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. Bulbs Cfl 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 acceleration in Forth Industrial Revolution
– Bulbs Cfl has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Bulbs Cfl 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 Bulbs Cfl with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Regulatory challenges
– Bulbs Cfl 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.
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 Bulbs Cfl in the Sales & Marketing sector and impact the bottomline of the organization.
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.
Shortening product life cycle
– it is one of the major threat that Bulbs Cfl 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 Selling CFLs at Wal-Mart, Epilogue 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 Selling CFLs at Wal-Mart, Epilogue 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 Selling CFLs at Wal-Mart, Epilogue 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 Selling CFLs at Wal-Mart, Epilogue 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 Selling CFLs at Wal-Mart, Epilogue 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 Bulbs Cfl needs to make to build a sustainable competitive advantage.
