Coffee Wars in India: CafA? Coffee Day 2013 SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study Description of Coffee Wars in India: CafA? Coffee Day 2013
CafA? Coffee Day (CCD) is the largest coffee retailer in India. In 2012, Starbucks entered the India market. This case explores CCD's competitive advantages, its analysis of Starbuck's entry strategy, and how it might respond to Starbucks' entry.
Swot Analysis of "Coffee Wars in India: CafA? Coffee Day 2013" written by David B. Yoffie, Rachna Tahilyani includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Coffee Cafa facing as an external strategic factors. Some of the topics covered in Coffee Wars in India: CafA? Coffee Day 2013 case study are - Strategic Management Strategies, Entrepreneurship, Marketing and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Coffee Wars in India: CafA? Coffee Day 2013 casestudy better are - – increasing energy prices, wage bills are increasing, there is increasing trade war between United States & China, there is backlash against globalization, increasing household debt because of falling income levels, increasing commodity prices, cloud computing is disrupting traditional business models,
competitive advantages are harder to sustain because of technology dispersion, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of Coffee Wars in India: CafA? Coffee Day 2013
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Coffee Wars in India: CafA? Coffee Day 2013 case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Coffee Cafa, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Coffee Cafa 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 Coffee Wars in India: CafA? Coffee Day 2013 can be done for the following purposes –
1. Strategic planning using facts provided in Coffee Wars in India: CafA? Coffee Day 2013 case study
2. Improving business portfolio management of Coffee Cafa
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 Coffee Cafa
Strengths Coffee Wars in India: CafA? Coffee Day 2013 | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Coffee Cafa in Coffee Wars in India: CafA? Coffee Day 2013 Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of Coffee Cafa in the sector have low bargaining power. Coffee Wars in India: CafA? Coffee Day 2013 has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Coffee Cafa to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that Coffee Cafa has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Innovation driven organization
– Coffee Cafa is one of the most innovative firm in sector. Manager in Coffee Wars in India: CafA? Coffee Day 2013 Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Strong track record of project management
– Coffee Cafa is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to recruit top talent
– Coffee Cafa is one of the leading recruiters in the industry. Managers in the Coffee Wars in India: CafA? Coffee Day 2013 are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Training and development
– Coffee Cafa has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Coffee Wars in India: CafA? Coffee Day 2013 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.
Cross disciplinary teams
– Horizontal connected teams at the Coffee Cafa 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.
Organizational Resilience of Coffee Cafa
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Coffee Cafa does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Analytics focus
– Coffee Cafa 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 David B. Yoffie, Rachna Tahilyani 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.
Ability to lead change in Strategy & Execution field
– Coffee Cafa 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 Coffee Cafa in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Successful track record of launching new products
– Coffee Cafa has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Coffee Cafa 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.
Learning organization
- Coffee Cafa 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 Coffee Cafa is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Coffee Wars in India: CafA? Coffee Day 2013 Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses Coffee Wars in India: CafA? Coffee Day 2013 | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Coffee Wars in India: CafA? Coffee Day 2013 are -
Increasing silos among functional specialists
– The organizational structure of Coffee Cafa is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Coffee Cafa needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Coffee Cafa to focus more on services rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As Coffee Wars in India: CafA? Coffee Day 2013 HBR case study mentions - Coffee Cafa 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
– Coffee Cafa 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.
Slow decision making process
– As mentioned earlier in the report, Coffee Cafa 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. Coffee Cafa 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Coffee Wars in India: CafA? Coffee Day 2013, is just above the industry average. Coffee Cafa needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
High operating costs
– Compare to the competitors, firm in the HBR case study Coffee Wars in India: CafA? Coffee Day 2013 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 Coffee Cafa 's lucrative customers.
Skills based hiring
– The stress on hiring functional specialists at Coffee Cafa 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.
Capital Spending Reduction
– Even during the low interest decade, Coffee Cafa 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Coffee Wars in India: CafA? Coffee Day 2013, in the dynamic environment Coffee Cafa has struggled to respond to the nimble upstart competition. Coffee Cafa has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High bargaining power of channel partners
– Because of the regulatory requirements, David B. Yoffie, Rachna Tahilyani suggests that, Coffee Cafa 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.
Lack of clear differentiation of Coffee Cafa products
– To increase the profitability and margins on the products, Coffee Cafa needs to provide more differentiated products than what it is currently offering in the marketplace.
Opportunities Coffee Wars in India: CafA? Coffee Day 2013 | 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 Coffee Wars in India: CafA? Coffee Day 2013 are -
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Coffee Cafa can use these opportunities to build new business models that can help the communities that Coffee Cafa operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Building a culture of innovation
– managers at Coffee Cafa 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.
Developing new processes and practices
– Coffee Cafa 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.
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. Coffee Cafa can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Coffee Cafa can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Loyalty marketing
– Coffee Cafa 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Coffee Cafa is facing challenges because of the dominance of functional experts in the organization. Coffee Wars in India: CafA? Coffee Day 2013 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.
Buying journey improvements
– Coffee Cafa can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Coffee Wars in India: CafA? Coffee Day 2013 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.
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. Coffee Cafa 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. Coffee Cafa 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, Coffee Cafa 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, Coffee Wars in India: CafA? Coffee Day 2013, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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 Coffee Cafa 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.
Creating value in data economy
– The success of analytics program of Coffee Cafa has opened avenues for new revenue streams for the organization in the industry. This can help Coffee Cafa to build a more holistic ecosystem as suggested in the Coffee Wars in India: CafA? Coffee Day 2013 case study. Coffee Cafa 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
– Coffee Cafa 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 Coffee Wars in India: CafA? Coffee Day 2013 - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Coffee Cafa to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Coffee Wars in India: CafA? Coffee Day 2013 External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Coffee Wars in India: CafA? Coffee Day 2013 are -
Shortening product life cycle
– it is one of the major threat that Coffee Cafa is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
High dependence on third party suppliers
– Coffee Cafa 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 wage structure of Coffee Cafa
– 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 Coffee Cafa.
Environmental challenges
– Coffee Cafa 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. Coffee Cafa can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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. Coffee Cafa 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 Coffee Wars in India: CafA? Coffee Day 2013, Coffee Cafa 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 Coffee Cafa with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Coffee Cafa business can come under increasing regulations regarding data privacy, data security, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Coffee Cafa 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.
Technology acceleration in Forth Industrial Revolution
– Coffee Cafa has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Coffee Cafa 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.
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.
Consumer confidence and its impact on Coffee Cafa 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.
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 Coffee Cafa in the Strategy & Execution sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Coffee Wars in India: CafA? Coffee Day 2013 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 Coffee Wars in India: CafA? Coffee Day 2013 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 Coffee Wars in India: CafA? Coffee Day 2013 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 Coffee Wars in India: CafA? Coffee Day 2013 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 Coffee Wars in India: CafA? Coffee Day 2013 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 Coffee Cafa needs to make to build a sustainable competitive advantage.