Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
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Case Study Description of Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B)
This case describes the multi-prong negotiating approach that Bill Nichol, Kentucky Derby Hosiery Co. CEO, took to deal with an ultimatum from his largest customer, as well as the outcome of this process. It concludes with a number of Nichol's observations about supplier-retailer negotiations.
Swot Analysis of "Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B)" written by James K. Sebenius, Ellen Knebel includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Nichol Bill facing as an external strategic factors. Some of the topics covered in Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) case study are - Strategic Management Strategies, Negotiations and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) casestudy better are - – talent flight as more people leaving formal jobs, there is increasing trade war between United States & China, increasing government debt because of Covid-19 spendings, increasing transportation and logistics costs, customer relationship management is fast transforming because of increasing concerns over data privacy, competitive advantages are harder to sustain because of technology dispersion, increasing inequality as vast percentage of new income is going to the top 1%,
increasing energy prices, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Nichol Bill, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Nichol Bill 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 Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) can be done for the following purposes –
1. Strategic planning using facts provided in Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) case study
2. Improving business portfolio management of Nichol Bill
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 Nichol Bill
Strengths Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Nichol Bill in Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) Harvard Business Review case study are -
High brand equity
– Nichol Bill has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Nichol Bill to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Nichol Bill is present in almost all the verticals within the industry. This has provided firm in Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Organizational Resilience of Nichol Bill
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Nichol Bill does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Highly skilled collaborators
– Nichol Bill 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 Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to lead change in Strategy & Execution field
– Nichol Bill 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 Nichol Bill in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Learning organization
- Nichol Bill 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 Nichol Bill is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Strong track record of project management
– Nichol Bill 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
– Nichol Bill 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, Ellen Knebel 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.
Successful track record of launching new products
– Nichol Bill has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Nichol Bill 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.
Sustainable margins compare to other players in Strategy & Execution industry
– Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) firm has clearly differentiated products in the market place. This has enabled Nichol Bill to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Nichol Bill to invest into research and development (R&D) and innovation.
High switching costs
– The high switching costs that Nichol Bill 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.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Nichol Bill digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Nichol Bill has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Weaknesses Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) are -
Skills based hiring
– The stress on hiring functional specialists at Nichol Bill 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.
Lack of clear differentiation of Nichol Bill products
– To increase the profitability and margins on the products, Nichol Bill needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Nichol Bill 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.
Increasing silos among functional specialists
– The organizational structure of Nichol Bill is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Nichol Bill needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Nichol Bill to focus more on services rather than just following the product oriented approach.
Need for greater diversity
– Nichol Bill 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B), is just above the industry average. Nichol Bill 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.
Interest costs
– Compare to the competition, Nichol Bill has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) 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 Nichol Bill has relatively successful track record of launching new products.
Low market penetration in new markets
– Outside its home market of Nichol Bill, firm in the HBR case study Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Nichol Bill is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
No frontier risks strategy
– After analyzing the HBR case study Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B), it seems that company is thinking about the frontier risks that can impact Strategy & Execution strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Opportunities Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) | 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 Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) are -
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. Nichol Bill can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Using analytics as competitive advantage
– Nichol Bill 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 Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Nichol Bill to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Better consumer reach
– The expansion of the 5G network will help Nichol Bill to increase its market reach. Nichol Bill 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
– Nichol Bill can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) 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.
Manufacturing automation
– Nichol Bill 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. Nichol Bill can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Nichol Bill can use these opportunities to build new business models that can help the communities that Nichol Bill operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Leveraging digital technologies
– Nichol Bill 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.
Creating value in data economy
– The success of analytics program of Nichol Bill has opened avenues for new revenue streams for the organization in the industry. This can help Nichol Bill to build a more holistic ecosystem as suggested in the Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) case study. Nichol Bill can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Nichol Bill 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, Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Nichol Bill 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 Nichol Bill to hire the very best people irrespective of their geographical location.
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. Nichol Bill 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. Nichol Bill 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.
Learning at scale
– Online learning technologies has now opened space for Nichol Bill 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 Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) are -
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 Nichol Bill in the Strategy & Execution sector and impact the bottomline of the organization.
Shortening product life cycle
– it is one of the major threat that Nichol Bill 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 Nichol Bill 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.
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. Nichol Bill 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.
Increasing wage structure of Nichol Bill
– 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 Nichol Bill.
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Nichol Bill 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 Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) .
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B), Nichol Bill 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 .
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. Nichol Bill needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Technology acceleration in Forth Industrial Revolution
– Nichol Bill has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Nichol Bill 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.
Environmental challenges
– Nichol Bill 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. Nichol Bill can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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 Nichol Bill.
Weighted SWOT Analysis of Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) 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 Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) 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 Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) 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 Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) 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 Bill Nichol Negotiates with Walmart: Hard Bargains over Soft Goods (B) 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 Nichol Bill needs to make to build a sustainable competitive advantage.
