ArtesanA?as de Colombia, Spanish Version SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of ArtesanA?as de Colombia, Spanish Version
Upon becoming General Manager of ArtesanA?as de Colombia (AC) in January 2007, Paola MuA?oz faced the challenge of redefining the organization's strategy. The mission of AC, a mainly government organization with a 3 % private ownership, was to foster, promote, and market Colombian handicrafts, thus creating economic development opportunities for artisans, a low-income, mainly indigenous population. In early 2007, soon after assuming her role as General Manager, Paola evaluated the strategy, achievements, and limitations of her predecessor's 16-year-long management tenure, in order to craft her own strategy for the organization. Whereas the previous strategy focused on crafts-with a strong emphasis on the promotion of design and the positioning of crafts as very differentiated products among high-income clients-Paola wanted to discuss with her staff the pros and cons of reorienting the AC's strategy toward the artisans, through increased training, support, and capacity building especially in administrative, economic and organizational areas. The case is based on an organization that is primarily a public/ government organization with a social mission. Governments and government agencies still represent in most OECD countries between 40% and 50% of the economy. This case invites students to (1) strategy formulation in not-for-profit or governmental contexts (specifically in this case a hybrid organization with (a) a dual mandate -social and business orientations (b) in a sector in which the small focal organization promotes value creation with a vast number of producers -over 350,000 artisans in the country) and to (2) highlight the relevance and limitations of strategic management concepts and tools in such contexts. Besides a strategic management course, this case can be used in a corporate social responsibility course to illustrate the challenges of a hybrid organization, in which profit-making and social mission are complementary objectives.
Authors :: Guillermo D'Andrea, Javier Jorge Silva, Emmanuel ER Raufflet, Maricruz Prado
Swot Analysis of "ArtesanA?as de Colombia, Spanish Version" written by Guillermo D'Andrea, Javier Jorge Silva, Emmanuel ER Raufflet, Maricruz Prado includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Paola Artisans facing as an external strategic factors. Some of the topics covered in ArtesanA?as de Colombia, Spanish Version case study are - Strategic Management Strategies, Government, Leadership, Social responsibility, Strategy execution and Strategy & Execution.
Some of the macro environment factors that can be used to understand the ArtesanA?as de Colombia, Spanish Version casestudy better are - – geopolitical disruptions, cloud computing is disrupting traditional business models, increasing household debt because of falling income levels, digital marketing is dominated by two big players Facebook and Google, increasing transportation and logistics costs, talent flight as more people leaving formal jobs, banking and financial system is disrupted by Bitcoin and other crypto currencies,
challanges to central banks by blockchain based private currencies, there is backlash against globalization, etc
Introduction to SWOT Analysis of ArtesanA?as de Colombia, Spanish Version
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in ArtesanA?as de Colombia, Spanish Version case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Paola Artisans, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Paola Artisans 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 ArtesanA?as de Colombia, Spanish Version can be done for the following purposes –
1. Strategic planning using facts provided in ArtesanA?as de Colombia, Spanish Version case study
2. Improving business portfolio management of Paola Artisans
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 Paola Artisans
Strengths ArtesanA?as de Colombia, Spanish Version | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Paola Artisans in ArtesanA?as de Colombia, Spanish Version Harvard Business Review case study are -
Organizational Resilience of Paola Artisans
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Paola Artisans does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Sustainable margins compare to other players in Strategy & Execution industry
– ArtesanA?as de Colombia, Spanish Version firm has clearly differentiated products in the market place. This has enabled Paola Artisans to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Paola Artisans to invest into research and development (R&D) and innovation.
Low bargaining power of suppliers
– Suppliers of Paola Artisans in the sector have low bargaining power. ArtesanA?as de Colombia, Spanish Version has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Paola Artisans to manage not only supply disruptions but also source products at highly competitive prices.
Learning organization
- Paola Artisans 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 Paola Artisans is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in ArtesanA?as de Colombia, Spanish Version Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
High brand equity
– Paola Artisans has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Paola Artisans to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Effective Research and Development (R&D)
– Paola Artisans 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 ArtesanA?as de Colombia, Spanish Version - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High switching costs
– The high switching costs that Paola Artisans 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.
Ability to recruit top talent
– Paola Artisans is one of the leading recruiters in the industry. Managers in the ArtesanA?as de Colombia, Spanish Version are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Superior customer experience
– The customer experience strategy of Paola Artisans in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Operational resilience
– The operational resilience strategy in the ArtesanA?as de Colombia, Spanish Version Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Innovation driven organization
– Paola Artisans is one of the most innovative firm in sector. Manager in ArtesanA?as de Colombia, Spanish Version Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Diverse revenue streams
– Paola Artisans is present in almost all the verticals within the industry. This has provided firm in ArtesanA?as de Colombia, Spanish Version 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.
Weaknesses ArtesanA?as de Colombia, Spanish Version | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of ArtesanA?as de Colombia, Spanish Version are -
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Paola Artisans supply chain. Even after few cautionary changes mentioned in the HBR case study - ArtesanA?as de Colombia, Spanish Version, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Paola Artisans vulnerable to further global disruptions in South East Asia.
Aligning sales with marketing
– It come across in the case study ArtesanA?as de Colombia, Spanish Version 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 ArtesanA?as de Colombia, Spanish Version can leverage the sales team experience to cultivate customer relationships as Paola Artisans is planning to shift buying processes online.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study ArtesanA?as de Colombia, Spanish Version, it seems that the employees of Paola Artisans 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.
High operating costs
– Compare to the competitors, firm in the HBR case study ArtesanA?as de Colombia, Spanish Version 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 Paola Artisans 's lucrative customers.
Low market penetration in new markets
– Outside its home market of Paola Artisans, firm in the HBR case study ArtesanA?as de Colombia, Spanish Version needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Products dominated business model
– Even though Paola Artisans 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 - ArtesanA?as de Colombia, Spanish Version should strive to include more intangible value offerings along with its core products and services.
Increasing silos among functional specialists
– The organizational structure of Paola Artisans is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Paola Artisans needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Paola Artisans to focus more on services rather than just following the product oriented approach.
High bargaining power of channel partners
– Because of the regulatory requirements, Guillermo D'Andrea, Javier Jorge Silva, Emmanuel ER Raufflet, Maricruz Prado suggests that, Paola Artisans 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.
No frontier risks strategy
– After analyzing the HBR case study ArtesanA?as de Colombia, Spanish Version, 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.
Skills based hiring
– The stress on hiring functional specialists at Paola Artisans 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, Paola Artisans 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.
Opportunities ArtesanA?as de Colombia, Spanish Version | 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 ArtesanA?as de Colombia, Spanish Version are -
Buying journey improvements
– Paola Artisans can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. ArtesanA?as de Colombia, Spanish Version 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.
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 Paola Artisans 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.
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. Paola Artisans 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. Paola Artisans 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.
Loyalty marketing
– Paola Artisans 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, Paola Artisans is facing challenges because of the dominance of functional experts in the organization. ArtesanA?as de Colombia, Spanish Version 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Paola Artisans 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 Paola Artisans to hire the very best people irrespective of their geographical location.
Using analytics as competitive advantage
– Paola Artisans 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 ArtesanA?as de Colombia, Spanish Version - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Paola Artisans to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Creating value in data economy
– The success of analytics program of Paola Artisans has opened avenues for new revenue streams for the organization in the industry. This can help Paola Artisans to build a more holistic ecosystem as suggested in the ArtesanA?as de Colombia, Spanish Version case study. Paola Artisans can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at Paola Artisans 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.
Better consumer reach
– The expansion of the 5G network will help Paola Artisans to increase its market reach. Paola Artisans 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.
Developing new processes and practices
– Paola Artisans 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.
Leveraging digital technologies
– Paola Artisans 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Paola Artisans 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.
Threats ArtesanA?as de Colombia, Spanish Version External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study ArtesanA?as de Colombia, Spanish Version are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Paola Artisans 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 ArtesanA?as de Colombia, Spanish Version .
Increasing wage structure of Paola Artisans
– 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 Paola Artisans.
Shortening product life cycle
– it is one of the major threat that Paola Artisans is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Paola Artisans in the Strategy & Execution sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– Paola Artisans has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Paola Artisans 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Paola Artisans 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 Paola Artisans business can come under increasing regulations regarding data privacy, data security, etc.
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. Paola Artisans 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.
Consumer confidence and its impact on Paola Artisans 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.
Stagnating economy with rate increase
– Paola Artisans 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.
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 Paola Artisans.
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. Paola Artisans needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Regulatory challenges
– Paola Artisans 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.
Weighted SWOT Analysis of ArtesanA?as de Colombia, Spanish Version 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 ArtesanA?as de Colombia, Spanish Version 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 ArtesanA?as de Colombia, Spanish Version 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 ArtesanA?as de Colombia, Spanish Version 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 ArtesanA?as de Colombia, Spanish Version 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 Paola Artisans needs to make to build a sustainable competitive advantage.
