Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study Description of Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version
Details and evaluates results in Esquel's 2002 initiative to negotiate long-term partnerships with often-exploited farmers in Xinjiang (western China) to procure a superior cotton variety.
Swot Analysis of "Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version" written by James K. Sebenius, Cheng (Jason) Qian includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Xinjiang Cotton facing as an external strategic factors. Some of the topics covered in Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version case study are - Strategic Management Strategies, Growth strategy, Joint ventures, Leadership, Negotiations, Social responsibility and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version casestudy better are - – technology disruption, increasing energy prices, cloud computing is disrupting traditional business models, there is backlash against globalization, increasing household debt because of falling income levels, increasing inequality as vast percentage of new income is going to the top 1%, increasing commodity prices,
increasing government debt because of Covid-19 spendings, geopolitical disruptions, etc
Introduction to SWOT Analysis of Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Xinjiang Cotton, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Xinjiang Cotton 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 Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version can be done for the following purposes –
1. Strategic planning using facts provided in Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version case study
2. Improving business portfolio management of Xinjiang Cotton
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Xinjiang Cotton
Strengths Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Xinjiang Cotton in Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version Harvard Business Review case study are -
Successful track record of launching new products
– Xinjiang Cotton has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Xinjiang Cotton 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.
Operational resilience
– The operational resilience strategy in the Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Analytics focus
– Xinjiang Cotton 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 James K. Sebenius, Cheng (Jason) Qian 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.
High brand equity
– Xinjiang Cotton has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Xinjiang Cotton to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
High switching costs
– The high switching costs that Xinjiang Cotton 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.
Sustainable margins compare to other players in Strategy & Execution industry
– Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version firm has clearly differentiated products in the market place. This has enabled Xinjiang Cotton to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Xinjiang Cotton to invest into research and development (R&D) and innovation.
Training and development
– Xinjiang Cotton has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version 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.
Low bargaining power of suppliers
– Suppliers of Xinjiang Cotton in the sector have low bargaining power. Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Xinjiang Cotton to manage not only supply disruptions but also source products at highly competitive prices.
Effective Research and Development (R&D)
– Xinjiang Cotton 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 Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Strong track record of project management
– Xinjiang Cotton is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Superior customer experience
– The customer experience strategy of Xinjiang Cotton in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to recruit top talent
– Xinjiang Cotton is one of the leading recruiters in the industry. Managers in the Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Weaknesses Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version are -
Aligning sales with marketing
– It come across in the case study Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version 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 Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version can leverage the sales team experience to cultivate customer relationships as Xinjiang Cotton is planning to shift buying processes online.
Increasing silos among functional specialists
– The organizational structure of Xinjiang Cotton is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Xinjiang Cotton needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Xinjiang Cotton to focus more on services rather than just following the product oriented approach.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Xinjiang Cotton is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Products dominated business model
– Even though Xinjiang Cotton 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 - Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version should strive to include more intangible value offerings along with its core products and services.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version 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 Xinjiang Cotton has relatively successful track record of launching new products.
Low market penetration in new markets
– Outside its home market of Xinjiang Cotton, firm in the HBR case study Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Workers concerns about automation
– As automation is fast increasing in the segment, Xinjiang Cotton 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.
Need for greater diversity
– Xinjiang Cotton 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version, in the dynamic environment Xinjiang Cotton has struggled to respond to the nimble upstart competition. Xinjiang Cotton has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Skills based hiring
– The stress on hiring functional specialists at Xinjiang Cotton 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version, is just above the industry average. Xinjiang Cotton 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.
Opportunities Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version | 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 Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version are -
Leveraging digital technologies
– Xinjiang Cotton 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, Xinjiang Cotton is facing challenges because of the dominance of functional experts in the organization. Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version 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.
Using analytics as competitive advantage
– Xinjiang Cotton has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Xinjiang Cotton to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Xinjiang Cotton can use these opportunities to build new business models that can help the communities that Xinjiang Cotton operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Better consumer reach
– The expansion of the 5G network will help Xinjiang Cotton to increase its market reach. Xinjiang Cotton 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Xinjiang Cotton in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Strategy & Execution segment, and it will provide faster access to the consumers.
Buying journey improvements
– Xinjiang Cotton can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Xinjiang Cotton can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Manufacturing automation
– Xinjiang Cotton can use the latest technology developments to improve its manufacturing and designing process in Strategy & Execution 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Strategy & Execution industry, but it has also influenced the consumer preferences. Xinjiang Cotton can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Building a culture of innovation
– managers at Xinjiang Cotton 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 Strategy & Execution segment.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Xinjiang Cotton 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, Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Learning at scale
– Online learning technologies has now opened space for Xinjiang Cotton 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.
Threats Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version, Xinjiang Cotton may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Strategy & Execution .
Stagnating economy with rate increase
– Xinjiang Cotton 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.
Increasing wage structure of Xinjiang Cotton
– 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 Xinjiang Cotton.
Environmental challenges
– Xinjiang Cotton needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Xinjiang Cotton can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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 Xinjiang Cotton business can come under increasing regulations regarding data privacy, data security, 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. Xinjiang Cotton needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
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 Xinjiang Cotton.
Easy access to finance
– Easy access to finance in Strategy & Execution field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Xinjiang Cotton can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Xinjiang Cotton with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
High dependence on third party suppliers
– Xinjiang Cotton 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.
Shortening product life cycle
– it is one of the major threat that Xinjiang Cotton is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Xinjiang Cotton 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 Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version .
Regulatory challenges
– Xinjiang Cotton 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 Strategy & Execution industry regulations.
Weighted SWOT Analysis of Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version 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 Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version 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 Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version 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 Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version 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 Esquel Group: Building a Sustainable Partnership with Cotton Farmers in Xinjiang (B), Spanish Version 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 Xinjiang Cotton needs to make to build a sustainable competitive advantage.
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