Case Study Description of Combating the Yoga Guru: Dabur's Dilemma
The case intends to introduce the reader to a disruption in the Indian FMCG industry. A single new entrant, Patanjali entered the FMCG industry in 2006, combating incumbents and attacking them on all fronts. Within a short span of time, it was able to produce results and exceed industry expectations. The case starts with the evolution story of Dabur, the world's largest Ayurvedic and natural healthcare company. It indicates the major milestones of the company and how it has been able to combat all sorts of threats but retain the top spot in many of the segments it operates in, over the years. The case then discusses a potential threat to Dabur from the new entrant, Patanjali. Building on its Ayurveda brand, Patanjali launched a foray of FMCG products and, drastically reduced prices. Using the power of a Yoga guru that made the product so widely accepted among the Indian masses, Patanjali is threatening every FMCG giant in the country. The case then goes on to depict how Patanjali seems to have gone on a direct frontal attack against all existing big players. The case is written from the perspective of Dabur to understand the nature of competition it faces from Patanjali.
Swot Analysis of "Combating the Yoga Guru: Dabur's Dilemma" written by Manaswini Bhalla, Koustav Dey, Pulkit Aggarwal includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Patanjali Fmcg facing as an external strategic factors. Some of the topics covered in Combating the Yoga Guru: Dabur's Dilemma case study are - Strategic Management Strategies, and Global Business.
Some of the macro environment factors that can be used to understand the Combating the Yoga Guru: Dabur's Dilemma casestudy better are - – wage bills are increasing, cloud computing is disrupting traditional business models, increasing energy prices, digital marketing is dominated by two big players Facebook and Google, customer relationship management is fast transforming because of increasing concerns over data privacy, central banks are concerned over increasing inflation, there is backlash against globalization,
increasing government debt because of Covid-19 spendings, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of Combating the Yoga Guru: Dabur's Dilemma
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Combating the Yoga Guru: Dabur's Dilemma case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Patanjali Fmcg, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Patanjali Fmcg 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 Combating the Yoga Guru: Dabur's Dilemma can be done for the following purposes –
1. Strategic planning using facts provided in Combating the Yoga Guru: Dabur's Dilemma case study
2. Improving business portfolio management of Patanjali Fmcg
3. Assessing feasibility of the new initiative in Global Business field.
4. Making a Global Business topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Patanjali Fmcg
Strengths Combating the Yoga Guru: Dabur's Dilemma | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Patanjali Fmcg in Combating the Yoga Guru: Dabur's Dilemma Harvard Business Review case study are -
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Patanjali Fmcg digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Patanjali Fmcg 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.
Superior customer experience
– The customer experience strategy of Patanjali Fmcg in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to lead change in Global Business field
– Patanjali Fmcg 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 Patanjali Fmcg in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High switching costs
– The high switching costs that Patanjali Fmcg 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)
– Patanjali Fmcg 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 Combating the Yoga Guru: Dabur's Dilemma - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Innovation driven organization
– Patanjali Fmcg is one of the most innovative firm in sector. Manager in Combating the Yoga Guru: Dabur's Dilemma Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Diverse revenue streams
– Patanjali Fmcg is present in almost all the verticals within the industry. This has provided firm in Combating the Yoga Guru: Dabur's Dilemma 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.
Cross disciplinary teams
– Horizontal connected teams at the Patanjali Fmcg 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.
Low bargaining power of suppliers
– Suppliers of Patanjali Fmcg in the sector have low bargaining power. Combating the Yoga Guru: Dabur's Dilemma has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Patanjali Fmcg to manage not only supply disruptions but also source products at highly competitive prices.
Strong track record of project management
– Patanjali Fmcg is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Highly skilled collaborators
– Patanjali Fmcg 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 Combating the Yoga Guru: Dabur's Dilemma HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Operational resilience
– The operational resilience strategy in the Combating the Yoga Guru: Dabur's Dilemma 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.
Weaknesses Combating the Yoga Guru: Dabur's Dilemma | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Combating the Yoga Guru: Dabur's Dilemma are -
Need for greater diversity
– Patanjali Fmcg 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Patanjali Fmcg 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.
Low market penetration in new markets
– Outside its home market of Patanjali Fmcg, firm in the HBR case study Combating the Yoga Guru: Dabur's Dilemma needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
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 Patanjali Fmcg supply chain. Even after few cautionary changes mentioned in the HBR case study - Combating the Yoga Guru: Dabur's Dilemma, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Patanjali Fmcg vulnerable to further global disruptions in South East Asia.
Capital Spending Reduction
– Even during the low interest decade, Patanjali Fmcg 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Combating the Yoga Guru: Dabur's Dilemma, in the dynamic environment Patanjali Fmcg has struggled to respond to the nimble upstart competition. Patanjali Fmcg has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Interest costs
– Compare to the competition, Patanjali Fmcg 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.
Skills based hiring
– The stress on hiring functional specialists at Patanjali Fmcg 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.
Slow to strategic competitive environment developments
– As Combating the Yoga Guru: Dabur's Dilemma HBR case study mentions - Patanjali Fmcg 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.
Aligning sales with marketing
– It come across in the case study Combating the Yoga Guru: Dabur's Dilemma 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 Combating the Yoga Guru: Dabur's Dilemma can leverage the sales team experience to cultivate customer relationships as Patanjali Fmcg is planning to shift buying processes online.
High bargaining power of channel partners
– Because of the regulatory requirements, Manaswini Bhalla, Koustav Dey, Pulkit Aggarwal suggests that, Patanjali Fmcg 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 Combating the Yoga Guru: Dabur's Dilemma | 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 Combating the Yoga Guru: Dabur's Dilemma are -
Leveraging digital technologies
– Patanjali Fmcg 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.
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 Patanjali Fmcg in the consumer business. Now Patanjali Fmcg can target international markets with far fewer capital restrictions requirements than the existing system.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Patanjali Fmcg can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Loyalty marketing
– Patanjali Fmcg 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Patanjali Fmcg in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Global Business segment, and it will provide faster access to the consumers.
Using analytics as competitive advantage
– Patanjali Fmcg 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 Combating the Yoga Guru: Dabur's Dilemma - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Patanjali Fmcg to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Buying journey improvements
– Patanjali Fmcg can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Combating the Yoga Guru: Dabur's Dilemma 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.
Developing new processes and practices
– Patanjali Fmcg can develop new processes and procedures in Global Business 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Patanjali Fmcg 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 Patanjali Fmcg to hire the very best people irrespective of their geographical location.
Low interest rates
– Even though inflation is raising its head in most developed economies, Patanjali Fmcg can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Building a culture of innovation
– managers at Patanjali Fmcg 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 Global Business segment.
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. Patanjali Fmcg can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 Patanjali Fmcg 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.
Threats Combating the Yoga Guru: Dabur's Dilemma External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Combating the Yoga Guru: Dabur's Dilemma are -
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. Patanjali Fmcg needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.
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 Patanjali Fmcg business can come under increasing regulations regarding data privacy, data security, etc.
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Patanjali Fmcg 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 Combating the Yoga Guru: Dabur's Dilemma .
Regulatory challenges
– Patanjali Fmcg 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 Global Business industry regulations.
Increasing wage structure of Patanjali Fmcg
– 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 Patanjali Fmcg.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Combating the Yoga Guru: Dabur's Dilemma, Patanjali Fmcg may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Global Business .
Environmental challenges
– Patanjali Fmcg 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. Patanjali Fmcg can take advantage of this fund but it will also bring new competitors in the Global Business industry.
Shortening product life cycle
– it is one of the major threat that Patanjali Fmcg is facing in Global Business 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 Global Business field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Patanjali Fmcg can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
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. Patanjali Fmcg 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 acceleration in Forth Industrial Revolution
– Patanjali Fmcg has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Patanjali Fmcg needs to keep up with the evolution of technology in the Global Business 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.
Weighted SWOT Analysis of Combating the Yoga Guru: Dabur's Dilemma 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 Combating the Yoga Guru: Dabur's Dilemma 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 Combating the Yoga Guru: Dabur's Dilemma 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 Combating the Yoga Guru: Dabur's Dilemma 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 Combating the Yoga Guru: Dabur's Dilemma 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 Patanjali Fmcg needs to make to build a sustainable competitive advantage.