A Bayesian Examines the Lady Tasting Tea (Abridged) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of A Bayesian Examines the Lady Tasting Tea (Abridged)
This technical note accompanies the case/class on "The Lady Tasting Tea" (LTT). It describes how a Bayesian would update his or her prior probability for the probability the LTT can correctly distinguish cups of tea based on whether the milk was added first or last. The long-form note (UVA-QA-0769) describes both a discrete model (LTT has p of 0.5 or 0.8) and a more complicated continuous model (p is beta distributed). This abridged note describes only the discrete model. The case/class itself provides a very useful analogy with which students can explore the elements of statistical inference.
Swot Analysis of "A Bayesian Examines the Lady Tasting Tea (Abridged)" written by Phillip E. Pfeifer includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Ltt Tea facing as an external strategic factors. Some of the topics covered in A Bayesian Examines the Lady Tasting Tea (Abridged) case study are - Strategic Management Strategies, and Technology & Operations.
Some of the macro environment factors that can be used to understand the A Bayesian Examines the Lady Tasting Tea (Abridged) casestudy better are - – increasing government debt because of Covid-19 spendings, digital marketing is dominated by two big players Facebook and Google, competitive advantages are harder to sustain because of technology dispersion, cloud computing is disrupting traditional business models, challanges to central banks by blockchain based private currencies, technology disruption, increasing transportation and logistics costs,
increasing inequality as vast percentage of new income is going to the top 1%, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of A Bayesian Examines the Lady Tasting Tea (Abridged)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in A Bayesian Examines the Lady Tasting Tea (Abridged) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Ltt Tea, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Ltt Tea 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 A Bayesian Examines the Lady Tasting Tea (Abridged) can be done for the following purposes –
1. Strategic planning using facts provided in A Bayesian Examines the Lady Tasting Tea (Abridged) case study
2. Improving business portfolio management of Ltt Tea
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 Ltt Tea
Strengths A Bayesian Examines the Lady Tasting Tea (Abridged) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Ltt Tea in A Bayesian Examines the Lady Tasting Tea (Abridged) Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of Ltt Tea in the sector have low bargaining power. A Bayesian Examines the Lady Tasting Tea (Abridged) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Ltt Tea to manage not only supply disruptions but also source products at highly competitive prices.
Ability to recruit top talent
– Ltt Tea is one of the leading recruiters in the industry. Managers in the A Bayesian Examines the Lady Tasting Tea (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.
High switching costs
– The high switching costs that Ltt Tea 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.
Effective Research and Development (R&D)
– Ltt Tea 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 A Bayesian Examines the Lady Tasting Tea (Abridged) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Cross disciplinary teams
– Horizontal connected teams at the Ltt Tea 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.
Training and development
– Ltt Tea has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in A Bayesian Examines the Lady Tasting Tea (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.
Learning organization
- Ltt Tea 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 Ltt Tea is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in A Bayesian Examines the Lady Tasting Tea (Abridged) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in Technology & Operations industry
– A Bayesian Examines the Lady Tasting Tea (Abridged) firm has clearly differentiated products in the market place. This has enabled Ltt Tea to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Ltt Tea to invest into research and development (R&D) and innovation.
Strong track record of project management
– Ltt Tea is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Analytics focus
– Ltt Tea 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 Phillip E. Pfeifer 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.
Successful track record of launching new products
– Ltt Tea has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Ltt Tea 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.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Ltt Tea digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Ltt Tea 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.
Weaknesses A Bayesian Examines the Lady Tasting Tea (Abridged) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of A Bayesian Examines the Lady Tasting Tea (Abridged) are -
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study A Bayesian Examines the Lady Tasting Tea (Abridged), is just above the industry average. Ltt Tea 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, Ltt Tea 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.
Capital Spending Reduction
– Even during the low interest decade, Ltt Tea 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study A Bayesian Examines the Lady Tasting Tea (Abridged), it seems that the employees of Ltt Tea don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study A Bayesian Examines the Lady Tasting Tea (Abridged), in the dynamic environment Ltt Tea has struggled to respond to the nimble upstart competition. Ltt Tea has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Aligning sales with marketing
– It come across in the case study A Bayesian Examines the Lady Tasting Tea (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 A Bayesian Examines the Lady Tasting Tea (Abridged) can leverage the sales team experience to cultivate customer relationships as Ltt Tea is planning to shift buying processes online.
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 Ltt Tea supply chain. Even after few cautionary changes mentioned in the HBR case study - A Bayesian Examines the Lady Tasting Tea (Abridged), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Ltt Tea vulnerable to further global disruptions in South East Asia.
Low market penetration in new markets
– Outside its home market of Ltt Tea, firm in the HBR case study A Bayesian Examines the Lady Tasting Tea (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 A Bayesian Examines the Lady Tasting Tea (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 Ltt Tea 's lucrative customers.
High cash cycle compare to competitors
Ltt Tea 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.
No frontier risks strategy
– After analyzing the HBR case study A Bayesian Examines the Lady Tasting Tea (Abridged), 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.
Opportunities A Bayesian Examines the Lady Tasting Tea (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 A Bayesian Examines the Lady Tasting Tea (Abridged) are -
Learning at scale
– Online learning technologies has now opened space for Ltt Tea 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Ltt Tea is facing challenges because of the dominance of functional experts in the organization. A Bayesian Examines the Lady Tasting Tea (Abridged) 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.
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. Ltt Tea can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Developing new processes and practices
– Ltt Tea 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.
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 Ltt Tea 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.
Creating value in data economy
– The success of analytics program of Ltt Tea has opened avenues for new revenue streams for the organization in the industry. This can help Ltt Tea to build a more holistic ecosystem as suggested in the A Bayesian Examines the Lady Tasting Tea (Abridged) case study. Ltt Tea can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– Ltt Tea 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 A Bayesian Examines the Lady Tasting Tea (Abridged) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Ltt Tea 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, Ltt Tea 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, A Bayesian Examines the Lady Tasting Tea (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.
Loyalty marketing
– Ltt Tea 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.
Better consumer reach
– The expansion of the 5G network will help Ltt Tea to increase its market reach. Ltt Tea 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.
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. Ltt Tea 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. Ltt Tea 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Ltt Tea can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Ltt Tea can use these opportunities to build new business models that can help the communities that Ltt Tea operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Threats A Bayesian Examines the Lady Tasting Tea (Abridged) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study A Bayesian Examines the Lady Tasting Tea (Abridged) are -
Technology acceleration in Forth Industrial Revolution
– Ltt Tea has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Ltt Tea 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 Ltt Tea 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Ltt Tea 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.
Stagnating economy with rate increase
– Ltt Tea 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.
Regulatory challenges
– Ltt Tea 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.
Environmental challenges
– Ltt Tea 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. Ltt Tea 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 Ltt Tea business can come under increasing regulations regarding data privacy, data security, etc.
Increasing wage structure of Ltt Tea
– 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 Ltt Tea.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Ltt Tea with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Ltt Tea 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.
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.
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. Ltt Tea can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Shortening product life cycle
– it is one of the major threat that Ltt Tea is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of A Bayesian Examines the Lady Tasting Tea (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 A Bayesian Examines the Lady Tasting Tea (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 A Bayesian Examines the Lady Tasting Tea (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 A Bayesian Examines the Lady Tasting Tea (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 A Bayesian Examines the Lady Tasting Tea (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 Ltt Tea needs to make to build a sustainable competitive advantage.