Jabwood International: The Risky Business of Expanding East SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Jabwood International: The Risky Business of Expanding East
Jabwood, a wood trading company with four branches in Lebanon owned by the Jabado family, is contemplating international expansion into new markets - specifically, Saudi Arabia and China - to compensate for a decline in revenues. This case examines the macroeconomic environment of Lebanon, China and Saudi Arabia as well as the wood industry in those countries. The characteristics of a successful international expansion are considered. In addition to identifying the criteria of attractiveness for each country, the case requires a decision on a market entry strategy that would ensure a successful expansion for the company. Given the risks and tradeoffs in each country, Jabwood has to decide whether it should expand in either market or both and on the mode of entry it should adopt to increase its chances of success.
Swot Analysis of "Jabwood International: The Risky Business of Expanding East" written by Marina Apaydin, Rami Jabado, Hiba Obeid, Balsam Danhash includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Jabwood Lebanon facing as an external strategic factors. Some of the topics covered in Jabwood International: The Risky Business of Expanding East case study are - Strategic Management Strategies, Strategy and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Jabwood International: The Risky Business of Expanding East casestudy better are - – technology disruption, customer relationship management is fast transforming because of increasing concerns over data privacy, talent flight as more people leaving formal jobs, central banks are concerned over increasing inflation, increasing transportation and logistics costs, wage bills are increasing, there is backlash against globalization,
increasing inequality as vast percentage of new income is going to the top 1%, increasing commodity prices, etc
Introduction to SWOT Analysis of Jabwood International: The Risky Business of Expanding East
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Jabwood International: The Risky Business of Expanding East case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Jabwood Lebanon, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Jabwood Lebanon 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 Jabwood International: The Risky Business of Expanding East can be done for the following purposes –
1. Strategic planning using facts provided in Jabwood International: The Risky Business of Expanding East case study
2. Improving business portfolio management of Jabwood Lebanon
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 Jabwood Lebanon
Strengths Jabwood International: The Risky Business of Expanding East | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Jabwood Lebanon in Jabwood International: The Risky Business of Expanding East Harvard Business Review case study are -
Superior customer experience
– The customer experience strategy of Jabwood Lebanon in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Jabwood Lebanon 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 Jabwood International: The Risky Business of Expanding East 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
– Jabwood Lebanon 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 Jabwood Lebanon in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Training and development
– Jabwood Lebanon has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Jabwood International: The Risky Business of Expanding East Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Effective Research and Development (R&D)
– Jabwood Lebanon 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 Jabwood International: The Risky Business of Expanding East - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Innovation driven organization
– Jabwood Lebanon is one of the most innovative firm in sector. Manager in Jabwood International: The Risky Business of Expanding East Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Sustainable margins compare to other players in Strategy & Execution industry
– Jabwood International: The Risky Business of Expanding East firm has clearly differentiated products in the market place. This has enabled Jabwood Lebanon to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Jabwood Lebanon to invest into research and development (R&D) and innovation.
Successful track record of launching new products
– Jabwood Lebanon has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Jabwood Lebanon 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.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Jabwood Lebanon digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Jabwood Lebanon 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 recruit top talent
– Jabwood Lebanon is one of the leading recruiters in the industry. Managers in the Jabwood International: The Risky Business of Expanding East are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Strong track record of project management
– Jabwood Lebanon is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High brand equity
– Jabwood Lebanon has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Jabwood Lebanon to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses Jabwood International: The Risky Business of Expanding East | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Jabwood International: The Risky Business of Expanding East are -
Skills based hiring
– The stress on hiring functional specialists at Jabwood Lebanon 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Jabwood International: The Risky Business of Expanding East 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 Jabwood Lebanon 's lucrative customers.
Slow to strategic competitive environment developments
– As Jabwood International: The Risky Business of Expanding East HBR case study mentions - Jabwood Lebanon 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
– Jabwood Lebanon 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.
Products dominated business model
– Even though Jabwood Lebanon 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 - Jabwood International: The Risky Business of Expanding East should strive to include more intangible value offerings along with its core products and services.
Lack of clear differentiation of Jabwood Lebanon products
– To increase the profitability and margins on the products, Jabwood Lebanon needs to provide more differentiated products than what it is currently offering in the marketplace.
Interest costs
– Compare to the competition, Jabwood Lebanon 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 harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Jabwood Lebanon is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Jabwood International: The Risky Business of Expanding East 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 Jabwood International: The Risky Business of Expanding East, 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Jabwood Lebanon 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
Jabwood Lebanon 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.
Opportunities Jabwood International: The Risky Business of Expanding East | 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 Jabwood International: The Risky Business of Expanding East are -
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. Jabwood Lebanon 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. Jabwood Lebanon 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Jabwood Lebanon 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, Jabwood International: The Risky Business of Expanding East, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Better consumer reach
– The expansion of the 5G network will help Jabwood Lebanon to increase its market reach. Jabwood Lebanon 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.
Building a culture of innovation
– managers at Jabwood Lebanon 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.
Manufacturing automation
– Jabwood Lebanon 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.
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 Jabwood Lebanon 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Jabwood Lebanon 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 Jabwood Lebanon to hire the very best people irrespective of their geographical location.
Creating value in data economy
– The success of analytics program of Jabwood Lebanon has opened avenues for new revenue streams for the organization in the industry. This can help Jabwood Lebanon to build a more holistic ecosystem as suggested in the Jabwood International: The Risky Business of Expanding East case study. Jabwood Lebanon can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– Jabwood Lebanon 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 Jabwood International: The Risky Business of Expanding East - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Jabwood Lebanon to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Learning at scale
– Online learning technologies has now opened space for Jabwood Lebanon 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.
Leveraging digital technologies
– Jabwood Lebanon 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Jabwood Lebanon 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Jabwood Lebanon is facing challenges because of the dominance of functional experts in the organization. Jabwood International: The Risky Business of Expanding East 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.
Threats Jabwood International: The Risky Business of Expanding East External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Jabwood International: The Risky Business of Expanding East are -
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.
Regulatory challenges
– Jabwood Lebanon 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.
Stagnating economy with rate increase
– Jabwood Lebanon 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Jabwood Lebanon 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 Jabwood International: The Risky Business of Expanding East .
Increasing wage structure of Jabwood Lebanon
– 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 Jabwood Lebanon.
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. Jabwood Lebanon can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Jabwood Lebanon in the Strategy & Execution sector and impact the bottomline of the organization.
Consumer confidence and its impact on Jabwood Lebanon 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 Jabwood Lebanon.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Jabwood Lebanon 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.
Environmental challenges
– Jabwood Lebanon 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. Jabwood Lebanon can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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 Jabwood Lebanon business can come under increasing regulations regarding data privacy, data security, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Jabwood International: The Risky Business of Expanding East, Jabwood Lebanon 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 .
Weighted SWOT Analysis of Jabwood International: The Risky Business of Expanding East 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 Jabwood International: The Risky Business of Expanding East 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 Jabwood International: The Risky Business of Expanding East 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 Jabwood International: The Risky Business of Expanding East 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 Jabwood International: The Risky Business of Expanding East 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 Jabwood Lebanon needs to make to build a sustainable competitive advantage.