Case Study Description of Bacardi Southampton (D): Analyzing Agile System Savings
A spreadsheet model, AgileSavins, was written to support the Bacardi Southampton cases (A), (B), and (C). The Excel model and model analyses can be obtained by contacting Professor Robert D. Landel at The Darden School, University of Virginia (phone 434 924 4832 or email: landelr@darden.virginia.edu). This spreadsheet model is useful for students evaluating multiyear cost consequences of three alternative production planning systems that follow from analyses of the "Bacardi Southampton (A): A New Paradigm of Agile Thinking," (UV3519). Users can identify the sources of costs and benefits of the alternative production-planning systems under consideration at the company and then analyze the seven operating scenarios presented in the case.
Swot Analysis of "Bacardi Southampton (D): Analyzing Agile System Savings" written by Robert D. Landel, Cheng Cui includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Bacardi Southampton facing as an external strategic factors. Some of the topics covered in Bacardi Southampton (D): Analyzing Agile System Savings case study are - Strategic Management Strategies, Strategic planning, Supply chain and Technology & Operations.
Some of the macro environment factors that can be used to understand the Bacardi Southampton (D): Analyzing Agile System Savings casestudy better are - – increasing household debt because of falling income levels, technology disruption, banking and financial system is disrupted by Bitcoin and other crypto currencies, talent flight as more people leaving formal jobs, competitive advantages are harder to sustain because of technology dispersion, cloud computing is disrupting traditional business models, supply chains are disrupted by pandemic ,
digital marketing is dominated by two big players Facebook and Google, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Bacardi Southampton (D): Analyzing Agile System Savings
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Bacardi Southampton (D): Analyzing Agile System Savings case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Bacardi Southampton, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Bacardi Southampton 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 Bacardi Southampton (D): Analyzing Agile System Savings can be done for the following purposes –
1. Strategic planning using facts provided in Bacardi Southampton (D): Analyzing Agile System Savings case study
2. Improving business portfolio management of Bacardi Southampton
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 Bacardi Southampton
Strengths Bacardi Southampton (D): Analyzing Agile System Savings | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Bacardi Southampton in Bacardi Southampton (D): Analyzing Agile System Savings Harvard Business Review case study are -
Operational resilience
– The operational resilience strategy in the Bacardi Southampton (D): Analyzing Agile System Savings 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
– Bacardi Southampton is one of the most innovative firm in sector. Manager in Bacardi Southampton (D): Analyzing Agile System Savings Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Bacardi Southampton digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Bacardi Southampton 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.
High switching costs
– The high switching costs that Bacardi Southampton 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.
Analytics focus
– Bacardi Southampton 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 Robert D. Landel, Cheng Cui 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 recruit top talent
– Bacardi Southampton is one of the leading recruiters in the industry. Managers in the Bacardi Southampton (D): Analyzing Agile System Savings are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Low bargaining power of suppliers
– Suppliers of Bacardi Southampton in the sector have low bargaining power. Bacardi Southampton (D): Analyzing Agile System Savings has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Bacardi Southampton to manage not only supply disruptions but also source products at highly competitive prices.
High brand equity
– Bacardi Southampton has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Bacardi Southampton to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Effective Research and Development (R&D)
– Bacardi Southampton 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 Bacardi Southampton (D): Analyzing Agile System Savings - 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
– Bacardi Southampton has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Bacardi Southampton has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Learning organization
- Bacardi Southampton 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 Bacardi Southampton is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Bacardi Southampton (D): Analyzing Agile System Savings Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Superior customer experience
– The customer experience strategy of Bacardi Southampton in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses Bacardi Southampton (D): Analyzing Agile System Savings | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Bacardi Southampton (D): Analyzing Agile System Savings are -
High bargaining power of channel partners
– Because of the regulatory requirements, Robert D. Landel, Cheng Cui suggests that, Bacardi Southampton 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.
High cash cycle compare to competitors
Bacardi Southampton 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 Bacardi Southampton is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Bacardi Southampton needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Bacardi Southampton to focus more on services rather than just following the product oriented approach.
Low market penetration in new markets
– Outside its home market of Bacardi Southampton, firm in the HBR case study Bacardi Southampton (D): Analyzing Agile System Savings needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Bacardi Southampton (D): Analyzing Agile System Savings, in the dynamic environment Bacardi Southampton has struggled to respond to the nimble upstart competition. Bacardi Southampton has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High operating costs
– Compare to the competitors, firm in the HBR case study Bacardi Southampton (D): Analyzing Agile System Savings 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 Bacardi Southampton 's lucrative customers.
Slow to strategic competitive environment developments
– As Bacardi Southampton (D): Analyzing Agile System Savings HBR case study mentions - Bacardi Southampton 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Bacardi Southampton (D): Analyzing Agile System Savings, is just above the industry average. Bacardi Southampton needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Bacardi Southampton (D): Analyzing Agile System Savings 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 Bacardi Southampton has relatively successful track record of launching new products.
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 Bacardi Southampton supply chain. Even after few cautionary changes mentioned in the HBR case study - Bacardi Southampton (D): Analyzing Agile System Savings, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Bacardi Southampton vulnerable to further global disruptions in South East Asia.
Need for greater diversity
– Bacardi Southampton 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.
Opportunities Bacardi Southampton (D): Analyzing Agile System Savings | 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 Bacardi Southampton (D): Analyzing Agile System Savings are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Bacardi Southampton 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 Bacardi Southampton to hire the very best people irrespective of their geographical location.
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. Bacardi Southampton can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Bacardi Southampton 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, Bacardi Southampton (D): Analyzing Agile System Savings, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Bacardi Southampton 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.
Leveraging digital technologies
– Bacardi Southampton 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Bacardi Southampton can use these opportunities to build new business models that can help the communities that Bacardi Southampton operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Low interest rates
– Even though inflation is raising its head in most developed economies, Bacardi Southampton 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.
Building a culture of innovation
– managers at Bacardi Southampton 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.
Better consumer reach
– The expansion of the 5G network will help Bacardi Southampton to increase its market reach. Bacardi Southampton 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.
Loyalty marketing
– Bacardi Southampton 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, Bacardi Southampton is facing challenges because of the dominance of functional experts in the organization. Bacardi Southampton (D): Analyzing Agile System Savings 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.
Creating value in data economy
– The success of analytics program of Bacardi Southampton has opened avenues for new revenue streams for the organization in the industry. This can help Bacardi Southampton to build a more holistic ecosystem as suggested in the Bacardi Southampton (D): Analyzing Agile System Savings case study. Bacardi Southampton can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Manufacturing automation
– Bacardi Southampton 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.
Threats Bacardi Southampton (D): Analyzing Agile System Savings External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Bacardi Southampton (D): Analyzing Agile System Savings are -
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 Bacardi Southampton business can come under increasing regulations regarding data privacy, data security, etc.
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. Bacardi Southampton 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
– Bacardi Southampton 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.
Stagnating economy with rate increase
– Bacardi Southampton 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Bacardi Southampton 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 Bacardi Southampton (D): Analyzing Agile System Savings .
High dependence on third party suppliers
– Bacardi Southampton 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.
Environmental challenges
– Bacardi Southampton 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. Bacardi Southampton can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Bacardi Southampton 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.
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. Bacardi Southampton 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 Bacardi Southampton.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Bacardi Southampton (D): Analyzing Agile System Savings, Bacardi Southampton 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 .
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 Bacardi Southampton in the Technology & Operations sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Bacardi Southampton (D): Analyzing Agile System Savings 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 Bacardi Southampton (D): Analyzing Agile System Savings 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 Bacardi Southampton (D): Analyzing Agile System Savings 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 Bacardi Southampton (D): Analyzing Agile System Savings 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 Bacardi Southampton (D): Analyzing Agile System Savings 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 Bacardi Southampton needs to make to build a sustainable competitive advantage.
