General Mills Commits to Sourcing 100% Sustainable Cocoa SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study Description of General Mills Commits to Sourcing 100% Sustainable Cocoa
Jacob Madisson is wondering how General Mills will make it to its goal of sourcing 100% sustainable cocoa by 2020. Demand is increasing and some are wondering if the supply of the precious raw material will dry up. Prices will certainly increase, nevertheless. With only 10% of its African-based cocoa sourced sustainably, General Mills needs a new strategy. How will the company move forward?
Swot Analysis of "General Mills Commits to Sourcing 100% Sustainable Cocoa" written by Andrew Hoffman includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Cocoa Mills facing as an external strategic factors. Some of the topics covered in General Mills Commits to Sourcing 100% Sustainable Cocoa case study are - Strategic Management Strategies, Supply chain and Strategy & Execution.
Some of the macro environment factors that can be used to understand the General Mills Commits to Sourcing 100% Sustainable Cocoa casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, there is increasing trade war between United States & China, geopolitical disruptions, central banks are concerned over increasing inflation, supply chains are disrupted by pandemic , wage bills are increasing, banking and financial system is disrupted by Bitcoin and other crypto currencies,
increasing commodity prices, technology disruption, etc
Introduction to SWOT Analysis of General Mills Commits to Sourcing 100% Sustainable Cocoa
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in General Mills Commits to Sourcing 100% Sustainable Cocoa case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Cocoa Mills, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Cocoa Mills 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 General Mills Commits to Sourcing 100% Sustainable Cocoa can be done for the following purposes –
1. Strategic planning using facts provided in General Mills Commits to Sourcing 100% Sustainable Cocoa case study
2. Improving business portfolio management of Cocoa Mills
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 Cocoa Mills
Strengths General Mills Commits to Sourcing 100% Sustainable Cocoa | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Cocoa Mills in General Mills Commits to Sourcing 100% Sustainable Cocoa Harvard Business Review case study are -
Sustainable margins compare to other players in Strategy & Execution industry
– General Mills Commits to Sourcing 100% Sustainable Cocoa firm has clearly differentiated products in the market place. This has enabled Cocoa Mills to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Cocoa Mills to invest into research and development (R&D) and innovation.
Organizational Resilience of Cocoa Mills
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Cocoa Mills does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– Cocoa Mills has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in General Mills Commits to Sourcing 100% Sustainable Cocoa 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.
Highly skilled collaborators
– Cocoa Mills 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 General Mills Commits to Sourcing 100% Sustainable Cocoa HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Learning organization
- Cocoa Mills 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 Cocoa Mills is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in General Mills Commits to Sourcing 100% Sustainable Cocoa Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to lead change in Strategy & Execution field
– Cocoa Mills 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 Cocoa Mills in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Effective Research and Development (R&D)
– Cocoa Mills 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 General Mills Commits to Sourcing 100% Sustainable Cocoa - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Cocoa Mills digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Cocoa Mills 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.
Strong track record of project management
– Cocoa Mills is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Cross disciplinary teams
– Horizontal connected teams at the Cocoa Mills 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.
Operational resilience
– The operational resilience strategy in the General Mills Commits to Sourcing 100% Sustainable Cocoa 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.
Superior customer experience
– The customer experience strategy of Cocoa Mills in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses General Mills Commits to Sourcing 100% Sustainable Cocoa | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of General Mills Commits to Sourcing 100% Sustainable Cocoa are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the General Mills Commits to Sourcing 100% Sustainable Cocoa 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 Cocoa Mills has relatively successful track record of launching new products.
Lack of clear differentiation of Cocoa Mills products
– To increase the profitability and margins on the products, Cocoa Mills needs to provide more differentiated products than what it is currently offering in the marketplace.
Aligning sales with marketing
– It come across in the case study General Mills Commits to Sourcing 100% Sustainable Cocoa 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 General Mills Commits to Sourcing 100% Sustainable Cocoa can leverage the sales team experience to cultivate customer relationships as Cocoa Mills is planning to shift buying processes online.
Increasing silos among functional specialists
– The organizational structure of Cocoa Mills is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Cocoa Mills needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Cocoa Mills to focus more on services rather than just following the product oriented approach.
Skills based hiring
– The stress on hiring functional specialists at Cocoa Mills 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 cash cycle compare to competitors
Cocoa Mills 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study General Mills Commits to Sourcing 100% Sustainable Cocoa, in the dynamic environment Cocoa Mills has struggled to respond to the nimble upstart competition. Cocoa Mills has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow decision making process
– As mentioned earlier in the report, Cocoa Mills 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. Cocoa Mills 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.
Products dominated business model
– Even though Cocoa Mills 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 - General Mills Commits to Sourcing 100% Sustainable Cocoa should strive to include more intangible value offerings along with its core products and services.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Cocoa Mills is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study General Mills Commits to Sourcing 100% Sustainable Cocoa can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Low market penetration in new markets
– Outside its home market of Cocoa Mills, firm in the HBR case study General Mills Commits to Sourcing 100% Sustainable Cocoa needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Opportunities General Mills Commits to Sourcing 100% Sustainable Cocoa | 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 General Mills Commits to Sourcing 100% Sustainable Cocoa are -
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Strategy & Execution industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Cocoa Mills can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Cocoa Mills can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Cocoa Mills can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Cocoa Mills is facing challenges because of the dominance of functional experts in the organization. General Mills Commits to Sourcing 100% Sustainable Cocoa 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.
Learning at scale
– Online learning technologies has now opened space for Cocoa Mills 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.
Building a culture of innovation
– managers at Cocoa Mills 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.
Using analytics as competitive advantage
– Cocoa Mills 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 General Mills Commits to Sourcing 100% Sustainable Cocoa - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Cocoa Mills to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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 Cocoa Mills 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.
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 Cocoa Mills in the consumer business. Now Cocoa Mills 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 Cocoa Mills 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.
Creating value in data economy
– The success of analytics program of Cocoa Mills has opened avenues for new revenue streams for the organization in the industry. This can help Cocoa Mills to build a more holistic ecosystem as suggested in the General Mills Commits to Sourcing 100% Sustainable Cocoa case study. Cocoa Mills can build new products and services such as - data insight services, data privacy related products, data based consulting services, 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. Cocoa Mills can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Low interest rates
– Even though inflation is raising its head in most developed economies, Cocoa Mills 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.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Cocoa Mills can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats General Mills Commits to Sourcing 100% Sustainable Cocoa External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study General Mills Commits to Sourcing 100% Sustainable Cocoa are -
Shortening product life cycle
– it is one of the major threat that Cocoa Mills is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Cocoa Mills 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.
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. Cocoa Mills can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing wage structure of Cocoa Mills
– 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 Cocoa Mills.
Stagnating economy with rate increase
– Cocoa Mills 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.
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.
Technology acceleration in Forth Industrial Revolution
– Cocoa Mills has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Cocoa Mills 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.
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. Cocoa Mills needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Consumer confidence and its impact on Cocoa Mills 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Cocoa Mills with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Regulatory challenges
– Cocoa Mills 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study General Mills Commits to Sourcing 100% Sustainable Cocoa, Cocoa Mills 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 .
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. Cocoa Mills 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 General Mills Commits to Sourcing 100% Sustainable Cocoa 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 General Mills Commits to Sourcing 100% Sustainable Cocoa 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 General Mills Commits to Sourcing 100% Sustainable Cocoa 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 General Mills Commits to Sourcing 100% Sustainable Cocoa 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 General Mills Commits to Sourcing 100% Sustainable Cocoa 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 Cocoa Mills needs to make to build a sustainable competitive advantage.
