Bhagwati Products Limited - Making in India for Micromax SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Bhagwati Products Limited - Making in India for Micromax
Emerging markets have become an attractive destination for multinationals as they provide these companies with high growth potential due to low product penetration and also help them in reducing costs of production due to reduced labor costs. The case brings out the trajectory of growth of Micromax Informatics Limited which started as a company depending on China and Taiwan for manufacturing of their handsets because of better technological infrastructure, stronger supply chain and cost effective workforce. As the government enhanced import duty on CBU (Completely Built Unit) electronic products and reduced excise duty and import duty on SKD (Semi Knocked Down) units required for manufacturing of electronic products, Micromax started its production facility, Bhagwati Products Limited in India and reduced import of finished electronic products to a large extent. To keep the cost low all across the value chain, it focused on development of indigenous design and manufacturing capabilities to achieve higher localization. This helped Micromax in keeping the cost of the products low and thus being a cost leader in the market. The case also brings out how costs can be kept low by utilizing central and state government initiatives in providing subsidies that helped the company build competitive advantage and how these specific actions resulted in creation of a vibrant electronics industry in the country. This case focuses on the specific issues faced by Bhagwati Products Limited, the production arm of Micromax in production of mobile phones locally, with regard to sourcing of raw material, manpower, research and development, competition and reduction in cost of production. The case also discusses the decision dilemma faced by the chairman on diversification of products to consumer electronics or to move into new territories with the core product in context of increased competition from multinationals in India.
Swot Analysis of "Bhagwati Products Limited - Making in India for Micromax" written by Sunita Mehta, Surya Kant Sharma, Arun Pereira includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Micromax Bhagwati facing as an external strategic factors. Some of the topics covered in Bhagwati Products Limited - Making in India for Micromax case study are - Strategic Management Strategies, and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Bhagwati Products Limited - Making in India for Micromax casestudy better are - – increasing transportation and logistics costs, cloud computing is disrupting traditional business models, increasing government debt because of Covid-19 spendings, there is increasing trade war between United States & China, talent flight as more people leaving formal jobs, digital marketing is dominated by two big players Facebook and Google, competitive advantages are harder to sustain because of technology dispersion,
challanges to central banks by blockchain based private currencies, geopolitical disruptions, etc
Introduction to SWOT Analysis of Bhagwati Products Limited - Making in India for Micromax
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Bhagwati Products Limited - Making in India for Micromax case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Micromax Bhagwati, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Micromax Bhagwati 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 Bhagwati Products Limited - Making in India for Micromax can be done for the following purposes –
1. Strategic planning using facts provided in Bhagwati Products Limited - Making in India for Micromax case study
2. Improving business portfolio management of Micromax Bhagwati
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 Micromax Bhagwati
Strengths Bhagwati Products Limited - Making in India for Micromax | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Micromax Bhagwati in Bhagwati Products Limited - Making in India for Micromax Harvard Business Review case study are -
Operational resilience
– The operational resilience strategy in the Bhagwati Products Limited - Making in India for Micromax 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.
Strong track record of project management
– Micromax Bhagwati is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Sustainable margins compare to other players in Strategy & Execution industry
– Bhagwati Products Limited - Making in India for Micromax firm has clearly differentiated products in the market place. This has enabled Micromax Bhagwati to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Micromax Bhagwati to invest into research and development (R&D) and innovation.
Learning organization
- Micromax Bhagwati 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 Micromax Bhagwati is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Bhagwati Products Limited - Making in India for Micromax Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Micromax Bhagwati 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.
Diverse revenue streams
– Micromax Bhagwati is present in almost all the verticals within the industry. This has provided firm in Bhagwati Products Limited - Making in India for Micromax 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.
Low bargaining power of suppliers
– Suppliers of Micromax Bhagwati in the sector have low bargaining power. Bhagwati Products Limited - Making in India for Micromax has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Micromax Bhagwati to manage not only supply disruptions but also source products at highly competitive prices.
Effective Research and Development (R&D)
– Micromax Bhagwati 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 Bhagwati Products Limited - Making in India for Micromax - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High brand equity
– Micromax Bhagwati has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Micromax Bhagwati to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Superior customer experience
– The customer experience strategy of Micromax Bhagwati in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Organizational Resilience of Micromax Bhagwati
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Micromax Bhagwati does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Analytics focus
– Micromax Bhagwati 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 Sunita Mehta, Surya Kant Sharma, Arun Pereira can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Weaknesses Bhagwati Products Limited - Making in India for Micromax | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Bhagwati Products Limited - Making in India for Micromax are -
Slow to strategic competitive environment developments
– As Bhagwati Products Limited - Making in India for Micromax HBR case study mentions - Micromax Bhagwati 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.
Increasing silos among functional specialists
– The organizational structure of Micromax Bhagwati is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Micromax Bhagwati needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Micromax Bhagwati to focus more on services rather than just following the product oriented approach.
Products dominated business model
– Even though Micromax Bhagwati 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 - Bhagwati Products Limited - Making in India for Micromax should strive to include more intangible value offerings along with its core products and services.
Workers concerns about automation
– As automation is fast increasing in the segment, Micromax Bhagwati 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, Micromax Bhagwati is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Bhagwati Products Limited - Making in India for Micromax can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Need for greater diversity
– Micromax Bhagwati has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Lack of clear differentiation of Micromax Bhagwati products
– To increase the profitability and margins on the products, Micromax Bhagwati needs to provide more differentiated products than what it is currently offering in the marketplace.
Capital Spending Reduction
– Even during the low interest decade, Micromax Bhagwati 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.
Skills based hiring
– The stress on hiring functional specialists at Micromax Bhagwati 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.
No frontier risks strategy
– After analyzing the HBR case study Bhagwati Products Limited - Making in India for Micromax, 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Sunita Mehta, Surya Kant Sharma, Arun Pereira suggests that, Micromax Bhagwati 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.
Opportunities Bhagwati Products Limited - Making in India for Micromax | 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 Bhagwati Products Limited - Making in India for Micromax are -
Learning at scale
– Online learning technologies has now opened space for Micromax Bhagwati 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.
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. Micromax Bhagwati 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. Micromax Bhagwati 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.
Using analytics as competitive advantage
– Micromax Bhagwati 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 Bhagwati Products Limited - Making in India for Micromax - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Micromax Bhagwati to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Manufacturing automation
– Micromax Bhagwati 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.
Buying journey improvements
– Micromax Bhagwati can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Bhagwati Products Limited - Making in India for Micromax 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.
Building a culture of innovation
– managers at Micromax Bhagwati 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
– Micromax Bhagwati 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Micromax Bhagwati is facing challenges because of the dominance of functional experts in the organization. Bhagwati Products Limited - Making in India for Micromax 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Micromax Bhagwati can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Micromax Bhagwati 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Micromax Bhagwati 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Micromax Bhagwati 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 Micromax Bhagwati to hire the very best people irrespective of their geographical location.
Better consumer reach
– The expansion of the 5G network will help Micromax Bhagwati to increase its market reach. Micromax Bhagwati 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.
Threats Bhagwati Products Limited - Making in India for Micromax External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Bhagwati Products Limited - Making in India for Micromax are -
Stagnating economy with rate increase
– Micromax Bhagwati 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.
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. Micromax Bhagwati can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Bhagwati Products Limited - Making in India for Micromax, Micromax Bhagwati 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 .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Micromax Bhagwati with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Shortening product life cycle
– it is one of the major threat that Micromax Bhagwati is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Micromax Bhagwati needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Micromax Bhagwati 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 Bhagwati Products Limited - Making in India for Micromax .
Regulatory challenges
– Micromax Bhagwati 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.
High dependence on third party suppliers
– Micromax Bhagwati 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.
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 wage structure of Micromax Bhagwati
– 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 Micromax Bhagwati.
Technology acceleration in Forth Industrial Revolution
– Micromax Bhagwati has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Micromax Bhagwati 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.
Consumer confidence and its impact on Micromax Bhagwati 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.
Weighted SWOT Analysis of Bhagwati Products Limited - Making in India for Micromax 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 Bhagwati Products Limited - Making in India for Micromax 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 Bhagwati Products Limited - Making in India for Micromax 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 Bhagwati Products Limited - Making in India for Micromax 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 Bhagwati Products Limited - Making in India for Micromax 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 Micromax Bhagwati needs to make to build a sustainable competitive advantage.