Case Study Description of Cascades Tissue Group: Sustainable Growth?
In October 2006, Ms. Suzanne Blanchet, President and Chief Executive Officer of Cascades Tissue Group (CTG), was pondering how much weight should be given to products sold under the CTG brand compared to those sold under distributors' or retailers' private labels. The fourth largest tissue paper producer in North America, CTG was one of the four divisions of Cascades Inc.: a giant in the Canadian pulp and paper industry. The distributor and retailer private label market offered an attractive prospect for growth, but at the expense of CTG's own brands, which were more economically viable. However, developing a brand required sustained resources and investments, especially in marketing, which CTG's plant managers were still reluctant to support. Furthermore, her decision had to take into account the opportunities and threats related to the arrival of producers from emerging countries.
Authors :: Pierre Batellier, Emmanuel ER Raufflet, Louis Hebert
Swot Analysis of "Cascades Tissue Group: Sustainable Growth?" written by Pierre Batellier, Emmanuel ER Raufflet, Louis Hebert includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Cascades Ctg facing as an external strategic factors. Some of the topics covered in Cascades Tissue Group: Sustainable Growth? case study are - Strategic Management Strategies, Strategic planning and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Cascades Tissue Group: Sustainable Growth? casestudy better are - – technology disruption, increasing transportation and logistics costs, increasing inequality as vast percentage of new income is going to the top 1%, cloud computing is disrupting traditional business models, wage bills are increasing, competitive advantages are harder to sustain because of technology dispersion, central banks are concerned over increasing inflation,
banking and financial system is disrupted by Bitcoin and other crypto currencies, there is backlash against globalization, etc
Introduction to SWOT Analysis of Cascades Tissue Group: Sustainable Growth?
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Cascades Tissue Group: Sustainable Growth? case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Cascades Ctg, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Cascades Ctg 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 Cascades Tissue Group: Sustainable Growth? can be done for the following purposes –
1. Strategic planning using facts provided in Cascades Tissue Group: Sustainable Growth? case study
2. Improving business portfolio management of Cascades Ctg
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 Cascades Ctg
Strengths Cascades Tissue Group: Sustainable Growth? | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Cascades Ctg in Cascades Tissue Group: Sustainable Growth? Harvard Business Review case study are -
Successful track record of launching new products
– Cascades Ctg has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Cascades Ctg 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.
Ability to recruit top talent
– Cascades Ctg is one of the leading recruiters in the industry. Managers in the Cascades Tissue Group: Sustainable Growth? are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Effective Research and Development (R&D)
– Cascades Ctg 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 Cascades Tissue Group: Sustainable Growth? - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Innovation driven organization
– Cascades Ctg is one of the most innovative firm in sector. Manager in Cascades Tissue Group: Sustainable Growth? Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Sustainable margins compare to other players in Strategy & Execution industry
– Cascades Tissue Group: Sustainable Growth? firm has clearly differentiated products in the market place. This has enabled Cascades Ctg to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Cascades Ctg to invest into research and development (R&D) and innovation.
Diverse revenue streams
– Cascades Ctg is present in almost all the verticals within the industry. This has provided firm in Cascades Tissue Group: Sustainable Growth? 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.
Operational resilience
– The operational resilience strategy in the Cascades Tissue Group: Sustainable Growth? 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.
Organizational Resilience of Cascades Ctg
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Cascades Ctg does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Learning organization
- Cascades Ctg 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 Cascades Ctg is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Cascades Tissue Group: Sustainable Growth? Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
High switching costs
– The high switching costs that Cascades Ctg 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.
Cross disciplinary teams
– Horizontal connected teams at the Cascades Ctg 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.
Strong track record of project management
– Cascades Ctg is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses Cascades Tissue Group: Sustainable Growth? | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Cascades Tissue Group: Sustainable Growth? are -
Increasing silos among functional specialists
– The organizational structure of Cascades Ctg is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Cascades Ctg needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Cascades Ctg to focus more on services rather than just following the product oriented approach.
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 Cascades Ctg supply chain. Even after few cautionary changes mentioned in the HBR case study - Cascades Tissue Group: Sustainable Growth?, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Cascades Ctg vulnerable to further global disruptions in South East Asia.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Cascades Tissue Group: Sustainable Growth?, in the dynamic environment Cascades Ctg has struggled to respond to the nimble upstart competition. Cascades Ctg has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Cascades Tissue Group: Sustainable Growth?, is just above the industry average. Cascades Ctg 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 bargaining power of channel partners
– Because of the regulatory requirements, Pierre Batellier, Emmanuel ER Raufflet, Louis Hebert suggests that, Cascades Ctg 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 to strategic competitive environment developments
– As Cascades Tissue Group: Sustainable Growth? HBR case study mentions - Cascades Ctg 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.
Aligning sales with marketing
– It come across in the case study Cascades Tissue Group: Sustainable Growth? 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 Cascades Tissue Group: Sustainable Growth? can leverage the sales team experience to cultivate customer relationships as Cascades Ctg is planning to shift buying processes online.
High cash cycle compare to competitors
Cascades Ctg 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Cascades Ctg 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Cascades Ctg is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Cascades Tissue Group: Sustainable Growth? can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Lack of clear differentiation of Cascades Ctg products
– To increase the profitability and margins on the products, Cascades Ctg needs to provide more differentiated products than what it is currently offering in the marketplace.
Opportunities Cascades Tissue Group: Sustainable Growth? | 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 Cascades Tissue Group: Sustainable Growth? are -
Leveraging digital technologies
– Cascades Ctg can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Cascades Ctg 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, Cascades Tissue Group: Sustainable Growth?, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Developing new processes and practices
– Cascades Ctg 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Cascades Ctg 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.
Learning at scale
– Online learning technologies has now opened space for Cascades Ctg 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.
Better consumer reach
– The expansion of the 5G network will help Cascades Ctg to increase its market reach. Cascades Ctg 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.
Buying journey improvements
– Cascades Ctg can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Cascades Tissue Group: Sustainable Growth? 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.
Loyalty marketing
– Cascades Ctg 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.
Manufacturing automation
– Cascades Ctg 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Cascades Ctg 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 Cascades Ctg 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.
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 Cascades Ctg 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 Cascades Ctg in the consumer business. Now Cascades Ctg can target international markets with far fewer capital restrictions requirements than the existing system.
Threats Cascades Tissue Group: Sustainable Growth? External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Cascades Tissue Group: Sustainable Growth? are -
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Cascades Ctg 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 Cascades Tissue Group: Sustainable Growth? .
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.
Environmental challenges
– Cascades Ctg 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. Cascades Ctg can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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. Cascades Ctg can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Cascades Ctg business can come under increasing regulations regarding data privacy, data security, etc.
Consumer confidence and its impact on Cascades Ctg 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.
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 Cascades Ctg.
High dependence on third party suppliers
– Cascades Ctg 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
– Cascades Ctg 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.
Regulatory challenges
– Cascades Ctg 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Cascades Ctg 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. Cascades Ctg needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Weighted SWOT Analysis of Cascades Tissue Group: Sustainable Growth? 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 Cascades Tissue Group: Sustainable Growth? 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 Cascades Tissue Group: Sustainable Growth? 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 Cascades Tissue Group: Sustainable Growth? 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 Cascades Tissue Group: Sustainable Growth? 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 Cascades Ctg needs to make to build a sustainable competitive advantage.