Case Study Description of Scharffen Berger Chocolate Maker (A), Spanish Version
Scharffen Berger, a premium brand chocolate, is growing rapidly and must decide where and when to add capacity in the production line and with what technology. The company must consider the demands of marketing, the impact on quality and reputation, and the economics of alternative approaches to increasing output in both the short term and long term. Provides an opportunity for students to examine the existing process technology and flow, to understand the determinants of product quality, and to make recommendations about changes that will expand the capabilities of the firm in supplying its premium products to a rapidly growing market segment.
Authors :: Daniel C. Snow, Steven C. Wheelwright, Alison Berkley Wagonfeld
Swot Analysis of "Scharffen Berger Chocolate Maker (A), Spanish Version" written by Daniel C. Snow, Steven C. Wheelwright, Alison Berkley Wagonfeld includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Scharffen Berger facing as an external strategic factors. Some of the topics covered in Scharffen Berger Chocolate Maker (A), Spanish Version case study are - Strategic Management Strategies, Manufacturing, Product development and Technology & Operations.
Some of the macro environment factors that can be used to understand the Scharffen Berger Chocolate Maker (A), Spanish Version casestudy better are - – increasing government debt because of Covid-19 spendings, digital marketing is dominated by two big players Facebook and Google, talent flight as more people leaving formal jobs, there is backlash against globalization, geopolitical disruptions, customer relationship management is fast transforming because of increasing concerns over data privacy, there is increasing trade war between United States & China,
central banks are concerned over increasing inflation, increasing energy prices, etc
Introduction to SWOT Analysis of Scharffen Berger Chocolate Maker (A), Spanish Version
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Scharffen Berger Chocolate Maker (A), Spanish Version case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Scharffen Berger, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Scharffen Berger 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 Scharffen Berger Chocolate Maker (A), Spanish Version can be done for the following purposes –
1. Strategic planning using facts provided in Scharffen Berger Chocolate Maker (A), Spanish Version case study
2. Improving business portfolio management of Scharffen Berger
3. Assessing feasibility of the new initiative in Technology & Operations field.
4. Making a Technology & Operations topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Scharffen Berger
Strengths Scharffen Berger Chocolate Maker (A), Spanish Version | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Scharffen Berger in Scharffen Berger Chocolate Maker (A), Spanish Version Harvard Business Review case study are -
Superior customer experience
– The customer experience strategy of Scharffen Berger in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Learning organization
- Scharffen Berger 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 Scharffen Berger is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Scharffen Berger Chocolate Maker (A), Spanish Version Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Effective Research and Development (R&D)
– Scharffen Berger 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 Scharffen Berger Chocolate Maker (A), 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.
Successful track record of launching new products
– Scharffen Berger has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Scharffen Berger 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.
Low bargaining power of suppliers
– Suppliers of Scharffen Berger in the sector have low bargaining power. Scharffen Berger Chocolate Maker (A), Spanish Version has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Scharffen Berger to manage not only supply disruptions but also source products at highly competitive prices.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Scharffen Berger digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Scharffen Berger 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.
Strong track record of project management
– Scharffen Berger 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
– Scharffen Berger has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Scharffen Berger to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Training and development
– Scharffen Berger has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Scharffen Berger Chocolate Maker (A), Spanish Version 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.
Operational resilience
– The operational resilience strategy in the Scharffen Berger Chocolate Maker (A), 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.
Analytics focus
– Scharffen Berger 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 Daniel C. Snow, Steven C. Wheelwright, Alison Berkley Wagonfeld 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.
Cross disciplinary teams
– Horizontal connected teams at the Scharffen Berger 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.
Weaknesses Scharffen Berger Chocolate Maker (A), Spanish Version | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Scharffen Berger Chocolate Maker (A), Spanish Version are -
Products dominated business model
– Even though Scharffen Berger 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 - Scharffen Berger Chocolate Maker (A), Spanish Version should strive to include more intangible value offerings along with its core products and services.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Scharffen Berger is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Scharffen Berger Chocolate Maker (A), Spanish Version can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Low market penetration in new markets
– Outside its home market of Scharffen Berger, firm in the HBR case study Scharffen Berger Chocolate Maker (A), Spanish Version needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Scharffen Berger Chocolate Maker (A), Spanish Version, it seems that the employees of Scharffen Berger 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 cash cycle compare to competitors
Scharffen Berger 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.
Need for greater diversity
– Scharffen Berger 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.
Aligning sales with marketing
– It come across in the case study Scharffen Berger Chocolate Maker (A), 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 Scharffen Berger Chocolate Maker (A), Spanish Version can leverage the sales team experience to cultivate customer relationships as Scharffen Berger is planning to shift buying processes online.
Skills based hiring
– The stress on hiring functional specialists at Scharffen Berger 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 dependence on star products
– The top 2 products and services of the firm as mentioned in the Scharffen Berger Chocolate Maker (A), Spanish Version HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Scharffen Berger has relatively successful track record of launching new products.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Scharffen Berger Chocolate Maker (A), Spanish Version, in the dynamic environment Scharffen Berger has struggled to respond to the nimble upstart competition. Scharffen Berger has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow decision making process
– As mentioned earlier in the report, Scharffen Berger 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. Scharffen Berger 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.
Opportunities Scharffen Berger Chocolate Maker (A), 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 Scharffen Berger Chocolate Maker (A), Spanish Version are -
Developing new processes and practices
– Scharffen Berger can develop new processes and procedures in Technology & Operations 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.
Loyalty marketing
– Scharffen Berger 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.
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 Scharffen Berger 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Scharffen Berger 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, Scharffen Berger Chocolate Maker (A), Spanish Version, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Scharffen Berger can use these opportunities to build new business models that can help the communities that Scharffen Berger operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Buying journey improvements
– Scharffen Berger can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Scharffen Berger Chocolate Maker (A), 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Technology & Operations industry, but it has also influenced the consumer preferences. Scharffen Berger can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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. Scharffen Berger can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Learning at scale
– Online learning technologies has now opened space for Scharffen Berger 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.
Building a culture of innovation
– managers at Scharffen Berger 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 Technology & Operations segment.
Low interest rates
– Even though inflation is raising its head in most developed economies, Scharffen Berger 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.
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 Scharffen Berger in the consumer business. Now Scharffen Berger 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 Technology & Operations industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Scharffen Berger 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. Scharffen Berger 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 Scharffen Berger Chocolate Maker (A), 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 Scharffen Berger Chocolate Maker (A), Spanish Version are -
Increasing wage structure of Scharffen Berger
– 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 Scharffen Berger.
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.
Environmental challenges
– Scharffen Berger 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. Scharffen Berger can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
Consumer confidence and its impact on Scharffen Berger 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.
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. Scharffen Berger needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
Shortening product life cycle
– it is one of the major threat that Scharffen Berger is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, 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 Scharffen Berger Chocolate Maker (A), Spanish Version, Scharffen Berger may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Technology & Operations .
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Scharffen Berger 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 Scharffen Berger Chocolate Maker (A), Spanish Version .
Stagnating economy with rate increase
– Scharffen Berger 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Scharffen Berger in the Technology & Operations industry. The Technology & Operations 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 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.
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 Scharffen Berger in the Technology & Operations sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– Scharffen Berger has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Scharffen Berger needs to keep up with the evolution of technology in the Technology & Operations 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.
Weighted SWOT Analysis of Scharffen Berger Chocolate Maker (A), 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 Scharffen Berger Chocolate Maker (A), 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 Scharffen Berger Chocolate Maker (A), 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 Scharffen Berger Chocolate Maker (A), 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 Scharffen Berger Chocolate Maker (A), 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 Scharffen Berger needs to make to build a sustainable competitive advantage.
