CEO Spotlight: Staying Relevant in an Age of Transformation SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of CEO Spotlight: Staying Relevant in an Age of Transformation
In a wide-ranging interview, the CEO of EstA?e Lauder Companies explains how he took the company from a market cap of $6 billion to $35 billion. He describes how he created new 'engines of growth' for the company through the diversification of its brands, categories, geographies and channels; the pros of working for a family-owned firm; why the company chooses to focus on its most discerning customers; and how he has engaged Millennials in creating company's forward-looking strategy.
Swot Analysis of "CEO Spotlight: Staying Relevant in an Age of Transformation" written by Fabrizio Freda, Karen Christensen includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Esta Discerning facing as an external strategic factors. Some of the topics covered in CEO Spotlight: Staying Relevant in an Age of Transformation case study are - Strategic Management Strategies, Risk management and Strategy & Execution.
Some of the macro environment factors that can be used to understand the CEO Spotlight: Staying Relevant in an Age of Transformation casestudy better are - – supply chains are disrupted by pandemic , increasing commodity prices, increasing household debt because of falling income levels, technology disruption, challanges to central banks by blockchain based private currencies, increasing transportation and logistics costs, there is increasing trade war between United States & China,
geopolitical disruptions, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of CEO Spotlight: Staying Relevant in an Age of Transformation
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in CEO Spotlight: Staying Relevant in an Age of Transformation case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Esta Discerning, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Esta Discerning 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 CEO Spotlight: Staying Relevant in an Age of Transformation can be done for the following purposes –
1. Strategic planning using facts provided in CEO Spotlight: Staying Relevant in an Age of Transformation case study
2. Improving business portfolio management of Esta Discerning
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Esta Discerning
Strengths CEO Spotlight: Staying Relevant in an Age of Transformation | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Esta Discerning in CEO Spotlight: Staying Relevant in an Age of Transformation Harvard Business Review case study are -
Sustainable margins compare to other players in Strategy & Execution industry
– CEO Spotlight: Staying Relevant in an Age of Transformation firm has clearly differentiated products in the market place. This has enabled Esta Discerning to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Esta Discerning to invest into research and development (R&D) and innovation.
Innovation driven organization
– Esta Discerning is one of the most innovative firm in sector. Manager in CEO Spotlight: Staying Relevant in an Age of Transformation Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Organizational Resilience of Esta Discerning
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Esta Discerning does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to lead change in Strategy & Execution field
– Esta Discerning 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 Esta Discerning in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Strong track record of project management
– Esta Discerning is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High switching costs
– The high switching costs that Esta Discerning 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)
– Esta Discerning 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 CEO Spotlight: Staying Relevant in an Age of Transformation - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Highly skilled collaborators
– Esta Discerning 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 CEO Spotlight: Staying Relevant in an Age of Transformation HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– Esta Discerning has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Esta Discerning 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
– Esta Discerning has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Esta Discerning to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Cross disciplinary teams
– Horizontal connected teams at the Esta Discerning 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.
Learning organization
- Esta Discerning 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 Esta Discerning is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in CEO Spotlight: Staying Relevant in an Age of Transformation Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses CEO Spotlight: Staying Relevant in an Age of Transformation | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of CEO Spotlight: Staying Relevant in an Age of Transformation are -
Low market penetration in new markets
– Outside its home market of Esta Discerning, firm in the HBR case study CEO Spotlight: Staying Relevant in an Age of Transformation needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study CEO Spotlight: Staying Relevant in an Age of Transformation, it seems that the employees of Esta Discerning 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.
Need for greater diversity
– Esta Discerning 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study CEO Spotlight: Staying Relevant in an Age of Transformation, in the dynamic environment Esta Discerning has struggled to respond to the nimble upstart competition. Esta Discerning has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
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 Esta Discerning supply chain. Even after few cautionary changes mentioned in the HBR case study - CEO Spotlight: Staying Relevant in an Age of Transformation, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Esta Discerning vulnerable to further global disruptions in South East Asia.
Slow decision making process
– As mentioned earlier in the report, Esta Discerning 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. Esta Discerning 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.
Lack of clear differentiation of Esta Discerning products
– To increase the profitability and margins on the products, Esta Discerning needs to provide more differentiated products than what it is currently offering in the marketplace.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the CEO Spotlight: Staying Relevant in an Age of Transformation 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 Esta Discerning has relatively successful track record of launching new products.
Capital Spending Reduction
– Even during the low interest decade, Esta Discerning 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.
Slow to strategic competitive environment developments
– As CEO Spotlight: Staying Relevant in an Age of Transformation HBR case study mentions - Esta Discerning 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 bargaining power of channel partners
– Because of the regulatory requirements, Fabrizio Freda, Karen Christensen suggests that, Esta Discerning 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.
Opportunities CEO Spotlight: Staying Relevant in an Age of Transformation | 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 CEO Spotlight: Staying Relevant in an Age of Transformation are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Esta Discerning 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, CEO Spotlight: Staying Relevant in an Age of Transformation, 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 Esta Discerning has opened avenues for new revenue streams for the organization in the industry. This can help Esta Discerning to build a more holistic ecosystem as suggested in the CEO Spotlight: Staying Relevant in an Age of Transformation case study. Esta Discerning can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Developing new processes and practices
– Esta Discerning can develop new processes and procedures in Strategy & Execution 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.
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 Esta Discerning in the consumer business. Now Esta Discerning can target international markets with far fewer capital restrictions requirements than the existing system.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Strategy & Execution industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Esta Discerning 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. Esta Discerning 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Strategy & Execution industry, but it has also influenced the consumer preferences. Esta Discerning can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Esta Discerning can use these opportunities to build new business models that can help the communities that Esta Discerning operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Building a culture of innovation
– managers at Esta Discerning 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 Strategy & Execution segment.
Leveraging digital technologies
– Esta Discerning 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.
Using analytics as competitive advantage
– Esta Discerning 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 CEO Spotlight: Staying Relevant in an Age of Transformation - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Esta Discerning to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Esta Discerning can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Esta Discerning in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Strategy & Execution segment, and it will provide faster access to the consumers.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Esta Discerning is facing challenges because of the dominance of functional experts in the organization. CEO Spotlight: Staying Relevant in an Age of Transformation 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.
Threats CEO Spotlight: Staying Relevant in an Age of Transformation External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study CEO Spotlight: Staying Relevant in an Age of Transformation are -
Easy access to finance
– Easy access to finance in Strategy & Execution field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Esta Discerning 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
– Esta Discerning 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. Esta Discerning can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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. Esta Discerning needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
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 international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Esta Discerning 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 CEO Spotlight: Staying Relevant in an Age of Transformation .
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 Esta Discerning business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Esta Discerning 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.
Technology acceleration in Forth Industrial Revolution
– Esta Discerning has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Esta Discerning needs to keep up with the evolution of technology in the Strategy & Execution 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.
Increasing wage structure of Esta Discerning
– 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 Esta Discerning.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study CEO Spotlight: Staying Relevant in an Age of Transformation, Esta Discerning may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Strategy & Execution .
Shortening product life cycle
– it is one of the major threat that Esta Discerning is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Esta Discerning.
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.
Weighted SWOT Analysis of CEO Spotlight: Staying Relevant in an Age of Transformation 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 CEO Spotlight: Staying Relevant in an Age of Transformation 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 CEO Spotlight: Staying Relevant in an Age of Transformation 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 CEO Spotlight: Staying Relevant in an Age of Transformation 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 CEO Spotlight: Staying Relevant in an Age of Transformation 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 Esta Discerning needs to make to build a sustainable competitive advantage.