Case Study Description of Beech-Nut Nutrition Corp. (A1)
The CEO of Beech-Nut Nutrition Corp. must decide what to do when he receives information that the company's supply of apple juice concentrate may be adulterated. The concentrate is used in many of the company's juice products. It appears that others in the company may have had reason to doubt the authenticity of the concentrate for several years. The case illustrates the importance of accurate information and open channels of communication to ensure sound decision making by top management. Also illustrates how emphasis on financial objectives and designated goals may obscure important ethical and legal considerations. May be used to discuss organizational barriers to information flow, approaches to decision making, and the role of the FDA and other U.S. regulatory officials in ensuring food purity.
Swot Analysis of "Beech-Nut Nutrition Corp. (A1)" written by Lynn Sharp Paine includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Concentrate Beech facing as an external strategic factors. Some of the topics covered in Beech-Nut Nutrition Corp. (A1) case study are - Strategic Management Strategies, Entrepreneurship, Ethics, Financial management, IT, Product development, Regulation and Technology & Operations.
Some of the macro environment factors that can be used to understand the Beech-Nut Nutrition Corp. (A1) casestudy better are - – digital marketing is dominated by two big players Facebook and Google, increasing energy prices, challanges to central banks by blockchain based private currencies, there is increasing trade war between United States & China, geopolitical disruptions, wage bills are increasing, there is backlash against globalization,
competitive advantages are harder to sustain because of technology dispersion, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Beech-Nut Nutrition Corp. (A1)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Beech-Nut Nutrition Corp. (A1) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Concentrate Beech, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Concentrate Beech 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 Beech-Nut Nutrition Corp. (A1) can be done for the following purposes –
1. Strategic planning using facts provided in Beech-Nut Nutrition Corp. (A1) case study
2. Improving business portfolio management of Concentrate Beech
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 Concentrate Beech
Strengths Beech-Nut Nutrition Corp. (A1) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Concentrate Beech in Beech-Nut Nutrition Corp. (A1) Harvard Business Review case study are -
High brand equity
– Concentrate Beech has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Concentrate Beech to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– Concentrate Beech is one of the most innovative firm in sector. Manager in Beech-Nut Nutrition Corp. (A1) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Low bargaining power of suppliers
– Suppliers of Concentrate Beech in the sector have low bargaining power. Beech-Nut Nutrition Corp. (A1) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Concentrate Beech to manage not only supply disruptions but also source products at highly competitive prices.
Training and development
– Concentrate Beech has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Beech-Nut Nutrition Corp. (A1) 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.
Strong track record of project management
– Concentrate Beech is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Effective Research and Development (R&D)
– Concentrate Beech 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 Beech-Nut Nutrition Corp. (A1) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Highly skilled collaborators
– Concentrate Beech has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Beech-Nut Nutrition Corp. (A1) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– Concentrate Beech has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Concentrate Beech 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.
Cross disciplinary teams
– Horizontal connected teams at the Concentrate Beech 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.
Analytics focus
– Concentrate Beech 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 Lynn Sharp Paine 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 Technology & Operations field
– Concentrate Beech 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 Concentrate Beech in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Superior customer experience
– The customer experience strategy of Concentrate Beech in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses Beech-Nut Nutrition Corp. (A1) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Beech-Nut Nutrition Corp. (A1) are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Beech-Nut Nutrition Corp. (A1) 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 Concentrate Beech has relatively successful track record of launching new products.
Products dominated business model
– Even though Concentrate Beech 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 - Beech-Nut Nutrition Corp. (A1) should strive to include more intangible value offerings along with its core products and services.
Need for greater diversity
– Concentrate Beech 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 Beech-Nut Nutrition Corp. (A1) 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 Beech-Nut Nutrition Corp. (A1) can leverage the sales team experience to cultivate customer relationships as Concentrate Beech is planning to shift buying processes online.
Capital Spending Reduction
– Even during the low interest decade, Concentrate Beech 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.
Interest costs
– Compare to the competition, Concentrate Beech 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.
Skills based hiring
– The stress on hiring functional specialists at Concentrate Beech 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Concentrate Beech needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
High operating costs
– Compare to the competitors, firm in the HBR case study Beech-Nut Nutrition Corp. (A1) 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 Concentrate Beech 's lucrative customers.
Increasing silos among functional specialists
– The organizational structure of Concentrate Beech is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Concentrate Beech needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Concentrate Beech to focus more on services rather than just following the product oriented approach.
High cash cycle compare to competitors
Concentrate Beech has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Opportunities Beech-Nut Nutrition Corp. (A1) | 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 Beech-Nut Nutrition Corp. (A1) are -
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 Concentrate Beech 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.
Manufacturing automation
– Concentrate Beech can use the latest technology developments to improve its manufacturing and designing process in Technology & Operations 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.
Learning at scale
– Online learning technologies has now opened space for Concentrate Beech to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Leveraging digital technologies
– Concentrate Beech 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 Concentrate Beech in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Technology & Operations segment, and it will provide faster access to the consumers.
Developing new processes and practices
– Concentrate Beech 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Concentrate Beech 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 Concentrate Beech to hire the very best people irrespective of their geographical location.
Buying journey improvements
– Concentrate Beech can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Beech-Nut Nutrition Corp. (A1) 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Concentrate Beech 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.
Loyalty marketing
– Concentrate Beech 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.
Using analytics as competitive advantage
– Concentrate Beech 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 Beech-Nut Nutrition Corp. (A1) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Concentrate Beech to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Building a culture of innovation
– managers at Concentrate Beech 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.
Creating value in data economy
– The success of analytics program of Concentrate Beech has opened avenues for new revenue streams for the organization in the industry. This can help Concentrate Beech to build a more holistic ecosystem as suggested in the Beech-Nut Nutrition Corp. (A1) case study. Concentrate Beech can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats Beech-Nut Nutrition Corp. (A1) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Beech-Nut Nutrition Corp. (A1) are -
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. Concentrate Beech needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
Consumer confidence and its impact on Concentrate Beech 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.
Technology acceleration in Forth Industrial Revolution
– Concentrate Beech has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Concentrate Beech 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Concentrate Beech with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing wage structure of Concentrate Beech
– 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 Concentrate Beech.
Environmental challenges
– Concentrate Beech 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. Concentrate Beech can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Concentrate Beech 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 Beech-Nut Nutrition Corp. (A1) .
Stagnating economy with rate increase
– Concentrate Beech 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.
High dependence on third party suppliers
– Concentrate Beech 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.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Beech-Nut Nutrition Corp. (A1), Concentrate Beech 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 .
Easy access to finance
– Easy access to finance in Technology & Operations field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Concentrate Beech can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Regulatory challenges
– Concentrate Beech 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 Technology & Operations industry regulations.
Weighted SWOT Analysis of Beech-Nut Nutrition Corp. (A1) 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 Beech-Nut Nutrition Corp. (A1) 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 Beech-Nut Nutrition Corp. (A1) 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 Beech-Nut Nutrition Corp. (A1) 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 Beech-Nut Nutrition Corp. (A1) 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 Concentrate Beech needs to make to build a sustainable competitive advantage.
