Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
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Case Study SWOT Analysis Solution
Case Study Description of Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point
Many discussions of raising national competitiveness take the "global factory" model as their starting point. This model essentially assumes that the primary way for less developed economies to catch up is to carry out low value-added activities within the global supply chain. The inevitable result is a frantic race to the bottom, where being competitive means being the lowest cost provider. This article proposes a markedly different approach based on the orchestration of an economy's "Vantage Point." Rather than cutting costs (and living standards), countries should instead focus on enhancing the value of the goods and services they naturally produce. Examples from Spain's Basque Country, Mexico and Colombia illustrate how intense collaboration and innovation in the production process -- even in the production of what may seem to be basic commodities -- can lead to a virtuous circle of value optimization and economic development.
Swot Analysis of "Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point" written by Alejandro Ruelas-Gossi includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Vantage Basque facing as an external strategic factors. Some of the topics covered in Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point case study are - Strategic Management Strategies, Strategy and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point casestudy better are - – increasing commodity prices, technology disruption, increasing household debt because of falling income levels, challanges to central banks by blockchain based private currencies, competitive advantages are harder to sustain because of technology dispersion, supply chains are disrupted by pandemic , central banks are concerned over increasing inflation,
there is increasing trade war between United States & China, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Vantage Basque, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Vantage Basque 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 Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point can be done for the following purposes –
1. Strategic planning using facts provided in Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point case study
2. Improving business portfolio management of Vantage Basque
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 Vantage Basque
Strengths Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Vantage Basque in Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point Harvard Business Review case study are -
Organizational Resilience of Vantage Basque
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Vantage Basque does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Low bargaining power of suppliers
– Suppliers of Vantage Basque in the sector have low bargaining power. Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Vantage Basque to manage not only supply disruptions but also source products at highly competitive prices.
High brand equity
– Vantage Basque has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Vantage Basque to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Successful track record of launching new products
– Vantage Basque has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Vantage Basque 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.
Diverse revenue streams
– Vantage Basque is present in almost all the verticals within the industry. This has provided firm in Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point 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.
Ability to recruit top talent
– Vantage Basque is one of the leading recruiters in the industry. Managers in the Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Sustainable margins compare to other players in Strategy & Execution industry
– Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point firm has clearly differentiated products in the market place. This has enabled Vantage Basque to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Vantage Basque to invest into research and development (R&D) and innovation.
Strong track record of project management
– Vantage Basque is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Cross disciplinary teams
– Horizontal connected teams at the Vantage Basque 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.
Analytics focus
– Vantage Basque 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 Alejandro Ruelas-Gossi 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.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Vantage Basque digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Vantage Basque 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.
Effective Research and Development (R&D)
– Vantage Basque 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 Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point are -
Workers concerns about automation
– As automation is fast increasing in the segment, Vantage Basque 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.
High cash cycle compare to competitors
Vantage Basque 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.
Lack of clear differentiation of Vantage Basque products
– To increase the profitability and margins on the products, Vantage Basque needs to provide more differentiated products than what it is currently offering in the marketplace.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point 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 Vantage Basque has relatively successful track record of launching new products.
No frontier risks strategy
– After analyzing the HBR case study Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point, 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.
Increasing silos among functional specialists
– The organizational structure of Vantage Basque is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Vantage Basque needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Vantage Basque to focus more on services rather than just following the product oriented approach.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point, it seems that the employees of Vantage Basque 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.
Aligning sales with marketing
– It come across in the case study Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point 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 Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point can leverage the sales team experience to cultivate customer relationships as Vantage Basque is planning to shift buying processes online.
High bargaining power of channel partners
– Because of the regulatory requirements, Alejandro Ruelas-Gossi suggests that, Vantage Basque 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.
Skills based hiring
– The stress on hiring functional specialists at Vantage Basque 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.
Slow to strategic competitive environment developments
– As Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point HBR case study mentions - Vantage Basque 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.
Opportunities Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point | 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 Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point are -
Building a culture of innovation
– managers at Vantage Basque 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
– Vantage Basque 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.
Learning at scale
– Online learning technologies has now opened space for Vantage Basque 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Vantage Basque 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.
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. Vantage Basque can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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. Vantage Basque 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. Vantage Basque 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
– Vantage Basque 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.
Buying journey improvements
– Vantage Basque can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Vantage Basque can use these opportunities to build new business models that can help the communities that Vantage Basque operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Low interest rates
– Even though inflation is raising its head in most developed economies, Vantage Basque 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.
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 Vantage Basque 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Vantage Basque is facing challenges because of the dominance of functional experts in the organization. Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point 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.
Loyalty marketing
– Vantage Basque 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.
Threats Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Vantage Basque with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Vantage Basque 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 Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point, Vantage Basque 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. Vantage Basque 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
– Vantage Basque 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Vantage Basque 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 Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point .
Technology acceleration in Forth Industrial Revolution
– Vantage Basque has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Vantage Basque 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 Vantage Basque 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 Vantage Basque.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Technology 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.
Regulatory challenges
– Vantage Basque 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.
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. Vantage Basque can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point 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 Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point 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 Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point 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 Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point 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 Escape the Low-Cost Trap & Enhance Value for Your Business: Crafting Your Vantage Point 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 Vantage Basque needs to make to build a sustainable competitive advantage.
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