Swot Analysis of "Bacardi Southampton (C): The German Paragon" written by Robert D. Landel, Daniel Zinner 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 (C): The German Paragon case study are - Strategic Management Strategies, Supply chain and Technology & Operations.
Some of the macro environment factors that can be used to understand the Bacardi Southampton (C): The German Paragon casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, increasing energy prices, cloud computing is disrupting traditional business models, geopolitical disruptions, increasing commodity prices, increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies,
banking and financial system is disrupted by Bitcoin and other crypto currencies, wage bills are increasing, etc
Introduction to SWOT Analysis of Bacardi Southampton (C): The German Paragon
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Bacardi Southampton (C): The German Paragon 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 (C): The German Paragon can be done for the following purposes –
1. Strategic planning using facts provided in Bacardi Southampton (C): The German Paragon 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 (C): The German Paragon | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Bacardi Southampton in Bacardi Southampton (C): The German Paragon Harvard Business Review case study are -
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.
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.
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, Daniel Zinner can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Diverse revenue streams
– Bacardi Southampton is present in almost all the verticals within the industry. This has provided firm in Bacardi Southampton (C): The German Paragon 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.
Low bargaining power of suppliers
– Suppliers of Bacardi Southampton in the sector have low bargaining power. Bacardi Southampton (C): The German Paragon 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 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.
Ability to lead change in Technology & Operations field
– Bacardi Southampton 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 Bacardi Southampton in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
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 (C): The German Paragon Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Operational resilience
– The operational resilience strategy in the Bacardi Southampton (C): The German Paragon 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.
Sustainable margins compare to other players in Technology & Operations industry
– Bacardi Southampton (C): The German Paragon firm has clearly differentiated products in the market place. This has enabled Bacardi Southampton to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Bacardi Southampton to invest into research and development (R&D) and innovation.
Organizational Resilience of Bacardi Southampton
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Bacardi Southampton does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Highly skilled collaborators
– Bacardi Southampton 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 Bacardi Southampton (C): The German Paragon HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses Bacardi Southampton (C): The German Paragon | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Bacardi Southampton (C): The German Paragon are -
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.
Skills based hiring
– The stress on hiring functional specialists at Bacardi Southampton 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.
Aligning sales with marketing
– It come across in the case study Bacardi Southampton (C): The German Paragon 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 Bacardi Southampton (C): The German Paragon can leverage the sales team experience to cultivate customer relationships as Bacardi Southampton is planning to shift buying processes online.
Lack of clear differentiation of Bacardi Southampton products
– To increase the profitability and margins on the products, Bacardi Southampton needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to strategic competitive environment developments
– As Bacardi Southampton (C): The German Paragon 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Bacardi Southampton (C): The German Paragon 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Bacardi Southampton 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 Bacardi Southampton (C): The German Paragon 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Bacardi Southampton (C): The German Paragon, 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.
No frontier risks strategy
– After analyzing the HBR case study Bacardi Southampton (C): The German Paragon, it seems that company is thinking about the frontier risks that can impact Technology & Operations 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.
Slow decision making process
– As mentioned earlier in the report, Bacardi Southampton 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. Bacardi Southampton 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 Bacardi Southampton (C): The German Paragon | 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 (C): The German Paragon are -
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.
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.
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 (C): The German Paragon, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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 (C): The German Paragon case study. Bacardi Southampton can build new products and services such as - data insight services, data privacy related products, data based consulting services, 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.
Buying journey improvements
– Bacardi Southampton can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Bacardi Southampton (C): The German Paragon 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.
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.
Using analytics as competitive advantage
– Bacardi Southampton 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 Bacardi Southampton (C): The German Paragon - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Bacardi Southampton to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Bacardi Southampton 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. Bacardi Southampton 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.
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. Bacardi Southampton can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Developing new processes and practices
– Bacardi Southampton 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.
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.
Threats Bacardi Southampton (C): The German Paragon 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 (C): The German Paragon are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Bacardi Southampton with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Increasing wage structure of Bacardi Southampton
– 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 Bacardi Southampton.
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.
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 (C): The German Paragon .
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.
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.
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.
Shortening product life cycle
– it is one of the major threat that Bacardi Southampton is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, 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.
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.
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.
Weighted SWOT Analysis of Bacardi Southampton (C): The German Paragon 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 (C): The German Paragon 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 (C): The German Paragon 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 (C): The German Paragon 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 (C): The German Paragon 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.