Case Study Description of CIBA-GEIGY Agricultural Division
In 1979 Leo Bontempo, marketing vice president of Ciba-Geigy Agricultural Division was deciding whether to purchase an $840,000 program for TeleSession. This was a marketing service designed to accelerate the adoption of new products among large innovative growers by promotional telephone conferences with others who had used the products. Raises a variety of communications issues and introduces diffusion of innovation concepts.
Authors :: Benson P. Shapiro, Anne T. Pigneri, Roy H. Schoeman
Swot Analysis of "CIBA-GEIGY Agricultural Division" written by Benson P. Shapiro, Anne T. Pigneri, Roy H. Schoeman includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Geigy Ciba facing as an external strategic factors. Some of the topics covered in CIBA-GEIGY Agricultural Division case study are - Strategic Management Strategies, Customers and Sales & Marketing.
Some of the macro environment factors that can be used to understand the CIBA-GEIGY Agricultural Division casestudy better are - – increasing household debt because of falling income levels, competitive advantages are harder to sustain because of technology dispersion, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing commodity prices, increasing energy prices, increasing government debt because of Covid-19 spendings, increasing transportation and logistics costs,
increasing inequality as vast percentage of new income is going to the top 1%, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of CIBA-GEIGY Agricultural Division
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in CIBA-GEIGY Agricultural Division case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Geigy Ciba, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Geigy Ciba 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 CIBA-GEIGY Agricultural Division can be done for the following purposes –
1. Strategic planning using facts provided in CIBA-GEIGY Agricultural Division case study
2. Improving business portfolio management of Geigy Ciba
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 Geigy Ciba
Strengths CIBA-GEIGY Agricultural Division | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Geigy Ciba in CIBA-GEIGY Agricultural Division Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of Geigy Ciba in the sector have low bargaining power. CIBA-GEIGY Agricultural Division has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Geigy Ciba to manage not only supply disruptions but also source products at highly competitive prices.
Cross disciplinary teams
– Horizontal connected teams at the Geigy Ciba 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.
Highly skilled collaborators
– Geigy Ciba 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 CIBA-GEIGY Agricultural Division HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Geigy Ciba is one of the most innovative firm in sector. Manager in CIBA-GEIGY Agricultural Division Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Learning organization
- Geigy Ciba 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 Geigy Ciba is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in CIBA-GEIGY Agricultural Division Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
High brand equity
– Geigy Ciba has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Geigy Ciba to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Superior customer experience
– The customer experience strategy of Geigy Ciba in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– Geigy Ciba has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in CIBA-GEIGY Agricultural Division 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.
Effective Research and Development (R&D)
– Geigy Ciba 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 CIBA-GEIGY Agricultural Division - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Diverse revenue streams
– Geigy Ciba is present in almost all the verticals within the industry. This has provided firm in CIBA-GEIGY Agricultural Division 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 Geigy Ciba
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Geigy Ciba does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Geigy Ciba digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Geigy Ciba 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.
Weaknesses CIBA-GEIGY Agricultural Division | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of CIBA-GEIGY Agricultural Division are -
Skills based hiring
– The stress on hiring functional specialists at Geigy Ciba 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the CIBA-GEIGY Agricultural Division 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 Geigy Ciba has relatively successful track record of launching new products.
High cash cycle compare to competitors
Geigy Ciba 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.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Geigy Ciba supply chain. Even after few cautionary changes mentioned in the HBR case study - CIBA-GEIGY Agricultural Division, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Geigy Ciba vulnerable to further global disruptions in South East Asia.
Slow to strategic competitive environment developments
– As CIBA-GEIGY Agricultural Division HBR case study mentions - Geigy Ciba 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study CIBA-GEIGY Agricultural Division, is just above the industry average. Geigy Ciba 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.
High operating costs
– Compare to the competitors, firm in the HBR case study CIBA-GEIGY Agricultural Division 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 Geigy Ciba 's lucrative customers.
Products dominated business model
– Even though Geigy Ciba 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 - CIBA-GEIGY Agricultural Division should strive to include more intangible value offerings along with its core products and services.
Interest costs
– Compare to the competition, Geigy Ciba 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.
No frontier risks strategy
– After analyzing the HBR case study CIBA-GEIGY Agricultural Division, 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 CIBA-GEIGY Agricultural Division, it seems that the employees of Geigy Ciba 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 CIBA-GEIGY Agricultural Division | 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 CIBA-GEIGY Agricultural Division are -
Better consumer reach
– The expansion of the 5G network will help Geigy Ciba to increase its market reach. Geigy Ciba 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Geigy Ciba 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 Geigy Ciba to hire the very best people irrespective of their geographical location.
Learning at scale
– Online learning technologies has now opened space for Geigy Ciba 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Geigy Ciba 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, CIBA-GEIGY Agricultural Division, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Leveraging digital technologies
– Geigy Ciba 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.
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 Geigy Ciba 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.
Loyalty marketing
– Geigy Ciba 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.
Developing new processes and practices
– Geigy Ciba 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Geigy Ciba can use these opportunities to build new business models that can help the communities that Geigy Ciba operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Creating value in data economy
– The success of analytics program of Geigy Ciba has opened avenues for new revenue streams for the organization in the industry. This can help Geigy Ciba to build a more holistic ecosystem as suggested in the CIBA-GEIGY Agricultural Division case study. Geigy Ciba can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Geigy Ciba 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 Geigy Ciba 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Geigy Ciba is facing challenges because of the dominance of functional experts in the organization. CIBA-GEIGY Agricultural Division 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.
Threats CIBA-GEIGY Agricultural Division External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study CIBA-GEIGY Agricultural Division are -
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 Geigy Ciba.
Consumer confidence and its impact on Geigy Ciba 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.
Technology acceleration in Forth Industrial Revolution
– Geigy Ciba has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Geigy Ciba 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.
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.
Regulatory challenges
– Geigy Ciba 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 CIBA-GEIGY Agricultural Division, Geigy Ciba may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Sales & Marketing .
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Geigy Ciba 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, Geigy Ciba 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 CIBA-GEIGY Agricultural Division .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Geigy Ciba with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 dependence on third party suppliers
– Geigy Ciba 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.
Stagnating economy with rate increase
– Geigy Ciba 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.
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. Geigy Ciba 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.
Weighted SWOT Analysis of CIBA-GEIGY Agricultural Division 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 CIBA-GEIGY Agricultural Division 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 CIBA-GEIGY Agricultural Division 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 CIBA-GEIGY Agricultural Division 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 CIBA-GEIGY Agricultural Division 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 Geigy Ciba needs to make to build a sustainable competitive advantage.
