Global Knowledge Management at Danone (A) (Abridged) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Global Knowledge Management at Danone (A) (Abridged)
This case explores French consumer goods company Danone's novel approach to knowledge management. In 2007, Human Resource Chief (Executive Vice President) Franck Mougin assessed the company's knowledge-sharing tools and considers his options going forward. Through informal knowledge marketplaces and sharing networks, Danone had helped managers connect with each other and share good practices peer-to-peer, rather than relying on traditional hierarchical lines of communication or IT repositories. From 2004 to 2007, Mougin and his team had found that 5,000 Danone managers around the world-the company conducted business in 120 countries-had shared about 640 now-documented good practices. In 2007, the strategic importance of saving time in a decentralized organization through adoption of colleagues' good practices was put to a test. Should the knowledge management tools be extended to include all employees and external partners on a regular basis? And on top of sharing good practices, could it be extended to include the creation of new solutions and processes? Would this require more formalization of processes and more tracking of results? The case illustrates Mougin's options on taking knowledge management into the future of Danone.
Swot Analysis of "Global Knowledge Management at Danone (A) (Abridged)" written by Amy C. Edmondson, David Lane includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Danone Knowledge facing as an external strategic factors. Some of the topics covered in Global Knowledge Management at Danone (A) (Abridged) case study are - Strategic Management Strategies, Growth strategy, Knowledge management, Managing people, Networking, Product development, Technology and Technology & Operations.
Some of the macro environment factors that can be used to understand the Global Knowledge Management at Danone (A) (Abridged) casestudy better are - – talent flight as more people leaving formal jobs, technology disruption, increasing transportation and logistics costs, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing government debt because of Covid-19 spendings, competitive advantages are harder to sustain because of technology dispersion, challanges to central banks by blockchain based private currencies,
geopolitical disruptions, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of Global Knowledge Management at Danone (A) (Abridged)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Global Knowledge Management at Danone (A) (Abridged) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Danone Knowledge, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Danone Knowledge 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 Global Knowledge Management at Danone (A) (Abridged) can be done for the following purposes –
1. Strategic planning using facts provided in Global Knowledge Management at Danone (A) (Abridged) case study
2. Improving business portfolio management of Danone Knowledge
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 Danone Knowledge
Strengths Global Knowledge Management at Danone (A) (Abridged) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Danone Knowledge in Global Knowledge Management at Danone (A) (Abridged) Harvard Business Review case study are -
Successful track record of launching new products
– Danone Knowledge has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Danone Knowledge 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 switching costs
– The high switching costs that Danone Knowledge has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Ability to recruit top talent
– Danone Knowledge is one of the leading recruiters in the industry. Managers in the Global Knowledge Management at Danone (A) (Abridged) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Cross disciplinary teams
– Horizontal connected teams at the Danone Knowledge 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.
Innovation driven organization
– Danone Knowledge is one of the most innovative firm in sector. Manager in Global Knowledge Management at Danone (A) (Abridged) 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 Danone Knowledge in the sector have low bargaining power. Global Knowledge Management at Danone (A) (Abridged) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Danone Knowledge to manage not only supply disruptions but also source products at highly competitive prices.
Sustainable margins compare to other players in Technology & Operations industry
– Global Knowledge Management at Danone (A) (Abridged) firm has clearly differentiated products in the market place. This has enabled Danone Knowledge to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Danone Knowledge to invest into research and development (R&D) and innovation.
Superior customer experience
– The customer experience strategy of Danone Knowledge in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Diverse revenue streams
– Danone Knowledge is present in almost all the verticals within the industry. This has provided firm in Global Knowledge Management at Danone (A) (Abridged) 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.
High brand equity
– Danone Knowledge has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Danone Knowledge to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Strong track record of project management
– Danone Knowledge is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Training and development
– Danone Knowledge has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Global Knowledge Management at Danone (A) (Abridged) 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.
Weaknesses Global Knowledge Management at Danone (A) (Abridged) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Global Knowledge Management at Danone (A) (Abridged) are -
Lack of clear differentiation of Danone Knowledge products
– To increase the profitability and margins on the products, Danone Knowledge needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Danone Knowledge 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.
Low market penetration in new markets
– Outside its home market of Danone Knowledge, firm in the HBR case study Global Knowledge Management at Danone (A) (Abridged) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High operating costs
– Compare to the competitors, firm in the HBR case study Global Knowledge Management at Danone (A) (Abridged) 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 Danone Knowledge 's lucrative customers.
Need for greater diversity
– Danone Knowledge 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Global Knowledge Management at Danone (A) (Abridged) 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 Danone Knowledge has relatively successful track record of launching new products.
Capital Spending Reduction
– Even during the low interest decade, Danone Knowledge 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.
Aligning sales with marketing
– It come across in the case study Global Knowledge Management at Danone (A) (Abridged) 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 Global Knowledge Management at Danone (A) (Abridged) can leverage the sales team experience to cultivate customer relationships as Danone Knowledge is planning to shift buying processes online.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Global Knowledge Management at Danone (A) (Abridged), is just above the industry average. Danone Knowledge 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.
Interest costs
– Compare to the competition, Danone Knowledge 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.
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 Danone Knowledge supply chain. Even after few cautionary changes mentioned in the HBR case study - Global Knowledge Management at Danone (A) (Abridged), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Danone Knowledge vulnerable to further global disruptions in South East Asia.
Opportunities Global Knowledge Management at Danone (A) (Abridged) | 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 Global Knowledge Management at Danone (A) (Abridged) 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 Danone Knowledge 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.
Using analytics as competitive advantage
– Danone Knowledge 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 Global Knowledge Management at Danone (A) (Abridged) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Danone Knowledge to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Danone Knowledge 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, Global Knowledge Management at Danone (A) (Abridged), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Building a culture of innovation
– managers at Danone Knowledge 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 Danone Knowledge has opened avenues for new revenue streams for the organization in the industry. This can help Danone Knowledge to build a more holistic ecosystem as suggested in the Global Knowledge Management at Danone (A) (Abridged) case study. Danone Knowledge can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
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. Danone Knowledge can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 Danone Knowledge in the consumer business. Now Danone Knowledge can target international markets with far fewer capital restrictions requirements than the existing system.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Danone Knowledge can use these opportunities to build new business models that can help the communities that Danone Knowledge operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Leveraging digital technologies
– Danone Knowledge 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Danone Knowledge 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
– Danone Knowledge 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.
Developing new processes and practices
– Danone Knowledge 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Danone Knowledge 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.
Threats Global Knowledge Management at Danone (A) (Abridged) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Global Knowledge Management at Danone (A) (Abridged) are -
Increasing wage structure of Danone Knowledge
– 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 Danone Knowledge.
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. Danone Knowledge 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Danone Knowledge 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 Global Knowledge Management at Danone (A) (Abridged) .
High dependence on third party suppliers
– Danone Knowledge 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.
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. Danone Knowledge can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Environmental challenges
– Danone Knowledge 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. Danone Knowledge can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
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 Danone Knowledge in the Technology & Operations sector and impact the bottomline of the organization.
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 Danone Knowledge business can come under increasing regulations regarding data privacy, data security, etc.
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. Danone Knowledge needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
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.
Regulatory challenges
– Danone Knowledge 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.
Technology acceleration in Forth Industrial Revolution
– Danone Knowledge has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Danone Knowledge 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.
Consumer confidence and its impact on Danone Knowledge 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.
Weighted SWOT Analysis of Global Knowledge Management at Danone (A) (Abridged) 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 Global Knowledge Management at Danone (A) (Abridged) 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 Global Knowledge Management at Danone (A) (Abridged) 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 Global Knowledge Management at Danone (A) (Abridged) 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 Global Knowledge Management at Danone (A) (Abridged) 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 Danone Knowledge needs to make to build a sustainable competitive advantage.
