Electronic Cigarettes in the EU: The Political Economy of Product Regulation SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Electronic Cigarettes in the EU: The Political Economy of Product Regulation
You are the CEO of an e-cigarette company that has just been acquired by a major tobacco company. Your company operates in the European market. The July 2013 draft of the EU Tobacco Products Directive (TPD) recently has been crafted by the European Commission, but it has not yet been examined by the EU Parliament and its Council. The draft proposes that all e-cigarette products be classified as medical devices, regardless of nicotine content. This is the strictest available mode of regulation. If the directive goes into effect as written, e-cigarettes would have to undergo costly and lengthy clinical trials to receive approval and face much stricter marketability restrictions. The case details the state of the e-cigarette industry in 2013, including consumer data, distribution, competition from similar products, and public health concerns. Students will analyze the current regulatory environment, determine what outcome would be most favorable to the e-cigarette industry, and identify the ways to achieve that goal.
Swot Analysis of "Electronic Cigarettes in the EU: The Political Economy of Product Regulation" written by Nicola Persico, Chen Cheng, Nicola Scocchi includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Cigarette Eu facing as an external strategic factors. Some of the topics covered in Electronic Cigarettes in the EU: The Political Economy of Product Regulation case study are - Strategic Management Strategies, and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Electronic Cigarettes in the EU: The Political Economy of Product Regulation casestudy better are - – supply chains are disrupted by pandemic , customer relationship management is fast transforming because of increasing concerns over data privacy, banking and financial system is disrupted by Bitcoin and other crypto currencies, there is backlash against globalization, technology disruption, increasing inequality as vast percentage of new income is going to the top 1%, increasing energy prices,
there is increasing trade war between United States & China, increasing commodity prices, etc
Introduction to SWOT Analysis of Electronic Cigarettes in the EU: The Political Economy of Product Regulation
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Electronic Cigarettes in the EU: The Political Economy of Product Regulation case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Cigarette Eu, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Cigarette Eu 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 Electronic Cigarettes in the EU: The Political Economy of Product Regulation can be done for the following purposes –
1. Strategic planning using facts provided in Electronic Cigarettes in the EU: The Political Economy of Product Regulation case study
2. Improving business portfolio management of Cigarette Eu
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 Cigarette Eu
Strengths Electronic Cigarettes in the EU: The Political Economy of Product Regulation | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Cigarette Eu in Electronic Cigarettes in the EU: The Political Economy of Product Regulation Harvard Business Review case study are -
Ability to lead change in Strategy & Execution field
– Cigarette Eu 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 Cigarette Eu in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Highly skilled collaborators
– Cigarette Eu 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 Electronic Cigarettes in the EU: The Political Economy of Product Regulation HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Operational resilience
– The operational resilience strategy in the Electronic Cigarettes in the EU: The Political Economy of Product Regulation 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.
Diverse revenue streams
– Cigarette Eu is present in almost all the verticals within the industry. This has provided firm in Electronic Cigarettes in the EU: The Political Economy of Product Regulation 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.
High brand equity
– Cigarette Eu has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Cigarette Eu to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Cigarette Eu digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Cigarette Eu 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.
Low bargaining power of suppliers
– Suppliers of Cigarette Eu in the sector have low bargaining power. Electronic Cigarettes in the EU: The Political Economy of Product Regulation has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Cigarette Eu to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Cigarette Eu in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Successful track record of launching new products
– Cigarette Eu has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Cigarette Eu 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.
Innovation driven organization
– Cigarette Eu is one of the most innovative firm in sector. Manager in Electronic Cigarettes in the EU: The Political Economy of Product Regulation Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Strong track record of project management
– Cigarette Eu is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Analytics focus
– Cigarette Eu 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 Nicola Persico, Chen Cheng, Nicola Scocchi 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.
Weaknesses Electronic Cigarettes in the EU: The Political Economy of Product Regulation | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Electronic Cigarettes in the EU: The Political Economy of Product Regulation are -
Need for greater diversity
– Cigarette Eu 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.
Lack of clear differentiation of Cigarette Eu products
– To increase the profitability and margins on the products, Cigarette Eu needs to provide more differentiated products than what it is currently offering in the marketplace.
Capital Spending Reduction
– Even during the low interest decade, Cigarette Eu 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.
Aligning sales with marketing
– It come across in the case study Electronic Cigarettes in the EU: The Political Economy of Product Regulation 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 Electronic Cigarettes in the EU: The Political Economy of Product Regulation can leverage the sales team experience to cultivate customer relationships as Cigarette Eu is planning to shift buying processes online.
Workers concerns about automation
– As automation is fast increasing in the segment, Cigarette Eu needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Low market penetration in new markets
– Outside its home market of Cigarette Eu, firm in the HBR case study Electronic Cigarettes in the EU: The Political Economy of Product Regulation needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High bargaining power of channel partners
– Because of the regulatory requirements, Nicola Persico, Chen Cheng, Nicola Scocchi suggests that, Cigarette Eu 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.
Slow decision making process
– As mentioned earlier in the report, Cigarette Eu 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. Cigarette Eu 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Electronic Cigarettes in the EU: The Political Economy of Product Regulation, in the dynamic environment Cigarette Eu has struggled to respond to the nimble upstart competition. Cigarette Eu 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 Cigarette Eu 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 operating costs
– Compare to the competitors, firm in the HBR case study Electronic Cigarettes in the EU: The Political Economy of Product Regulation 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 Cigarette Eu 's lucrative customers.
Opportunities Electronic Cigarettes in the EU: The Political Economy of Product Regulation | 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 Electronic Cigarettes in the EU: The Political Economy of Product Regulation are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Cigarette Eu can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Cigarette Eu 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, Electronic Cigarettes in the EU: The Political Economy of Product Regulation, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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 Cigarette Eu in the consumer business. Now Cigarette Eu can target international markets with far fewer capital restrictions requirements than the existing system.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Cigarette Eu 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.
Better consumer reach
– The expansion of the 5G network will help Cigarette Eu to increase its market reach. Cigarette Eu 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Cigarette Eu is facing challenges because of the dominance of functional experts in the organization. Electronic Cigarettes in the EU: The Political Economy of Product Regulation 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.
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. Cigarette Eu can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Loyalty marketing
– Cigarette Eu 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.
Building a culture of innovation
– managers at Cigarette Eu 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.
Leveraging digital technologies
– Cigarette Eu 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.
Using analytics as competitive advantage
– Cigarette Eu 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 Electronic Cigarettes in the EU: The Political Economy of Product Regulation - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Cigarette Eu to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Developing new processes and practices
– Cigarette Eu can develop new processes and procedures in Strategy & Execution 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Cigarette Eu 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 Cigarette Eu to hire the very best people irrespective of their geographical location.
Threats Electronic Cigarettes in the EU: The Political Economy of Product Regulation External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Electronic Cigarettes in the EU: The Political Economy of Product Regulation 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 Cigarette Eu.
Stagnating economy with rate increase
– Cigarette Eu 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.
Shortening product life cycle
– it is one of the major threat that Cigarette Eu is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Technology acceleration in Forth Industrial Revolution
– Cigarette Eu has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Cigarette Eu needs to keep up with the evolution of technology in the Strategy & Execution 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Cigarette Eu 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 Electronic Cigarettes in the EU: The Political Economy of Product Regulation .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Cigarette Eu in the Strategy & Execution industry. The Strategy & Execution 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Cigarette Eu with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Cigarette Eu needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Increasing wage structure of Cigarette Eu
– 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 Cigarette Eu.
High dependence on third party suppliers
– Cigarette Eu 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.
Environmental challenges
– Cigarette Eu 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. Cigarette Eu can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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.
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 Cigarette Eu in the Strategy & Execution sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Electronic Cigarettes in the EU: The Political Economy of Product Regulation 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 Electronic Cigarettes in the EU: The Political Economy of Product Regulation 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 Electronic Cigarettes in the EU: The Political Economy of Product Regulation 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 Electronic Cigarettes in the EU: The Political Economy of Product Regulation 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 Electronic Cigarettes in the EU: The Political Economy of Product Regulation 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 Cigarette Eu needs to make to build a sustainable competitive advantage.