ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study Description of ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid
Supplement to case IN1236. With ChotuKool, an innovative cooler, Gopalan Sunderraman, Executive Vice President at Godrej & Boyce Manufacturing and his team were able to profitably address a need of bottom-of-the-pyramid consumers in rural India. Case A presents the challenge and the approach used (in-market research) to identify the need and design a solution. To ensure ChotuKool's go-to-market strategy is a success, G&B must get the finance model and distribution model right. Case B explains how G&B partnered with micro-finance institutions and empowerment initiatives targeting local women to address the finance and distribution model challenges. It also describes the non-financial impact that ChotuKool had on local entrepreneurs and consumers, as well as hinting at future avenues for growth.
Swot Analysis of "ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid" written by Philip Parker, Byron Ascott-Evans includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Chotukool Pyramid facing as an external strategic factors. Some of the topics covered in ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid case study are - Strategic Management Strategies, Marketing, Social enterprise, Strategy and Strategy & Execution.
Some of the macro environment factors that can be used to understand the ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid casestudy better are - – there is backlash against globalization, customer relationship management is fast transforming because of increasing concerns over data privacy, banking and financial system is disrupted by Bitcoin and other crypto currencies, competitive advantages are harder to sustain because of technology dispersion, increasing energy prices, geopolitical disruptions, central banks are concerned over increasing inflation,
digital marketing is dominated by two big players Facebook and Google, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Chotukool Pyramid, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Chotukool Pyramid 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 ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid can be done for the following purposes –
1. Strategic planning using facts provided in ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid case study
2. Improving business portfolio management of Chotukool Pyramid
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 Chotukool Pyramid
Strengths ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Chotukool Pyramid in ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid Harvard Business Review case study are -
Strong track record of project management
– Chotukool Pyramid 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 switching costs
– The high switching costs that Chotukool Pyramid 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.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Chotukool Pyramid digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Chotukool Pyramid 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.
Analytics focus
– Chotukool Pyramid 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 Philip Parker, Byron Ascott-Evans 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.
Diverse revenue streams
– Chotukool Pyramid is present in almost all the verticals within the industry. This has provided firm in ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid 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.
Cross disciplinary teams
– Horizontal connected teams at the Chotukool Pyramid 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 Chotukool Pyramid
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Chotukool Pyramid does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Effective Research and Development (R&D)
– Chotukool Pyramid 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 ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Sustainable margins compare to other players in Strategy & Execution industry
– ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid firm has clearly differentiated products in the market place. This has enabled Chotukool Pyramid to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Chotukool Pyramid to invest into research and development (R&D) and innovation.
Innovation driven organization
– Chotukool Pyramid is one of the most innovative firm in sector. Manager in ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
High brand equity
– Chotukool Pyramid has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Chotukool Pyramid to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Successful track record of launching new products
– Chotukool Pyramid has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Chotukool Pyramid 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.
Weaknesses ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid are -
Need for greater diversity
– Chotukool Pyramid 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid, in the dynamic environment Chotukool Pyramid has struggled to respond to the nimble upstart competition. Chotukool Pyramid has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Capital Spending Reduction
– Even during the low interest decade, Chotukool Pyramid 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Chotukool Pyramid 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid, is just above the industry average. Chotukool Pyramid 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.
Lack of clear differentiation of Chotukool Pyramid products
– To increase the profitability and margins on the products, Chotukool Pyramid needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Chotukool Pyramid 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.
Increasing silos among functional specialists
– The organizational structure of Chotukool Pyramid is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Chotukool Pyramid needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Chotukool Pyramid to focus more on services rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid HBR case study mentions - Chotukool Pyramid 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Chotukool Pyramid is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Interest costs
– Compare to the competition, Chotukool Pyramid 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.
Opportunities ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid | 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 ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Chotukool Pyramid can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Learning at scale
– Online learning technologies has now opened space for Chotukool Pyramid 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.
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 Chotukool Pyramid 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Chotukool Pyramid can use these opportunities to build new business models that can help the communities that Chotukool Pyramid operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Loyalty marketing
– Chotukool Pyramid 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Chotukool Pyramid 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, ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Low interest rates
– Even though inflation is raising its head in most developed economies, Chotukool Pyramid 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.
Manufacturing automation
– Chotukool Pyramid 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.
Leveraging digital technologies
– Chotukool Pyramid 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, Chotukool Pyramid is facing challenges because of the dominance of functional experts in the organization. ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid 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.
Better consumer reach
– The expansion of the 5G network will help Chotukool Pyramid to increase its market reach. Chotukool Pyramid 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.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Chotukool Pyramid in the consumer business. Now Chotukool Pyramid can target international markets with far fewer capital restrictions requirements than the existing system.
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. Chotukool Pyramid 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. Chotukool Pyramid 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.
Threats ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid are -
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Chotukool Pyramid will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
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 Chotukool Pyramid.
High dependence on third party suppliers
– Chotukool Pyramid 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.
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. Chotukool Pyramid can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Chotukool Pyramid 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, Chotukool Pyramid 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 ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid .
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.
Increasing wage structure of Chotukool Pyramid
– 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 Chotukool Pyramid.
Environmental challenges
– Chotukool Pyramid 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. Chotukool Pyramid can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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 Chotukool Pyramid in the Strategy & Execution sector and impact the bottomline of the organization.
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 Chotukool Pyramid business can come under increasing regulations regarding data privacy, data security, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Chotukool Pyramid with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Consumer confidence and its impact on Chotukool Pyramid 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 ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid 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 ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid 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 ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid 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 ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid 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 ChotuKool (B): Consumer-centric Disruption at the Bottom of the Pyramid 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 Chotukool Pyramid needs to make to build a sustainable competitive advantage.