Swot Analysis of "ChoicePoint (B)" written by Lynn Sharp Paine, Zack Phillips includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Choicepoint Supplements facing as an external strategic factors. Some of the topics covered in ChoicePoint (B) case study are - Strategic Management Strategies, Data, Ethics, Internet, IT, Regulation, Security & privacy, Strategic planning and Strategy & Execution.
Some of the macro environment factors that can be used to understand the ChoicePoint (B) casestudy better are - – cloud computing is disrupting traditional business models, customer relationship management is fast transforming because of increasing concerns over data privacy, supply chains are disrupted by pandemic , increasing commodity prices, there is backlash against globalization, increasing transportation and logistics costs, competitive advantages are harder to sustain because of technology dispersion,
increasing household debt because of falling income levels, banking and financial system is disrupted by Bitcoin and other crypto currencies, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in ChoicePoint (B) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Choicepoint Supplements, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Choicepoint Supplements 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 ChoicePoint (B) can be done for the following purposes –
1. Strategic planning using facts provided in ChoicePoint (B) case study
2. Improving business portfolio management of Choicepoint Supplements
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 Choicepoint Supplements
Strengths ChoicePoint (B) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Choicepoint Supplements in ChoicePoint (B) Harvard Business Review case study are -
Successful track record of launching new products
– Choicepoint Supplements has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Choicepoint Supplements has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Operational resilience
– The operational resilience strategy in the ChoicePoint (B) 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.
Low bargaining power of suppliers
– Suppliers of Choicepoint Supplements in the sector have low bargaining power. ChoicePoint (B) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Choicepoint Supplements to manage not only supply disruptions but also source products at highly competitive prices.
Diverse revenue streams
– Choicepoint Supplements is present in almost all the verticals within the industry. This has provided firm in ChoicePoint (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.
High brand equity
– Choicepoint Supplements has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Choicepoint Supplements 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 Choicepoint Supplements digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Choicepoint Supplements 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.
Ability to lead change in Strategy & Execution field
– Choicepoint Supplements 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 Choicepoint Supplements in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Learning organization
- Choicepoint Supplements 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 Choicepoint Supplements is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in ChoicePoint (B) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Strong track record of project management
– Choicepoint Supplements is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Effective Research and Development (R&D)
– Choicepoint Supplements 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 ChoicePoint (B) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Sustainable margins compare to other players in Strategy & Execution industry
– ChoicePoint (B) firm has clearly differentiated products in the market place. This has enabled Choicepoint Supplements to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Choicepoint Supplements to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Choicepoint Supplements 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.
Weaknesses ChoicePoint (B) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of ChoicePoint (B) are -
Increasing silos among functional specialists
– The organizational structure of Choicepoint Supplements is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Choicepoint Supplements needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Choicepoint Supplements to focus more on services rather than just following the product oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Choicepoint Supplements 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Lynn Sharp Paine, Zack Phillips suggests that, Choicepoint Supplements 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, Choicepoint Supplements 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. Choicepoint Supplements 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study ChoicePoint (B), it seems that the employees of Choicepoint Supplements don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Low market penetration in new markets
– Outside its home market of Choicepoint Supplements, firm in the HBR case study ChoicePoint (B) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Interest costs
– Compare to the competition, Choicepoint Supplements 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.
Slow to strategic competitive environment developments
– As ChoicePoint (B) HBR case study mentions - Choicepoint Supplements 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.
Need for greater diversity
– Choicepoint Supplements 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.
High operating costs
– Compare to the competitors, firm in the HBR case study ChoicePoint (B) 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 Choicepoint Supplements 's lucrative customers.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study ChoicePoint (B), in the dynamic environment Choicepoint Supplements has struggled to respond to the nimble upstart competition. Choicepoint Supplements has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Opportunities ChoicePoint (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 ChoicePoint (B) are -
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. Choicepoint Supplements can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Buying journey improvements
– Choicepoint Supplements can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. ChoicePoint (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.
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. Choicepoint Supplements can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Low interest rates
– Even though inflation is raising its head in most developed economies, Choicepoint Supplements 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.
Loyalty marketing
– Choicepoint Supplements 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 Choicepoint Supplements 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
– Choicepoint Supplements 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Choicepoint Supplements 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Choicepoint Supplements can use these opportunities to build new business models that can help the communities that Choicepoint Supplements operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Choicepoint Supplements 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 Choicepoint Supplements 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. Choicepoint Supplements 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. Choicepoint Supplements 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.
Developing new processes and practices
– Choicepoint Supplements 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.
Manufacturing automation
– Choicepoint Supplements 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.
Threats ChoicePoint (B) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study ChoicePoint (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 Choicepoint Supplements in the Strategy & Execution sector and impact the bottomline 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 ChoicePoint (B), Choicepoint Supplements 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. Choicepoint Supplements needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
High dependence on third party suppliers
– Choicepoint Supplements 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.
Consumer confidence and its impact on Choicepoint Supplements 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.
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 Choicepoint Supplements business can come under increasing regulations regarding data privacy, data security, etc.
Regulatory challenges
– Choicepoint Supplements 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.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Choicepoint Supplements with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Choicepoint Supplements.
Shortening product life cycle
– it is one of the major threat that Choicepoint Supplements is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing wage structure of Choicepoint Supplements
– 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 Choicepoint Supplements.
Stagnating economy with rate increase
– Choicepoint Supplements 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.
Weighted SWOT Analysis of ChoicePoint (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 ChoicePoint (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 ChoicePoint (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 ChoicePoint (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 ChoicePoint (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 Choicepoint Supplements needs to make to build a sustainable competitive advantage.