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 - – supply chains are disrupted by pandemic , challanges to central banks by blockchain based private currencies, there is increasing trade war between United States & China, increasing commodity prices, there is backlash against globalization, increasing government debt because of Covid-19 spendings, technology disruption,
central banks are concerned over increasing inflation, digital marketing is dominated by two big players Facebook and Google, 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 -
High brand equity
– Patanjali Fmcg has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Patanjali Fmcg to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Analytics focus
– Patanjali Fmcg 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 Manaswini Bhalla, Koustav Dey, Pulkit Aggarwal 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.
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.
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.
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.
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.
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.
Organizational Resilience of Patanjali Fmcg
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Patanjali Fmcg does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
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.
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.
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.
Training and development
– Patanjali Fmcg has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Combating the Yoga Guru: Dabur's Dilemma 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 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 -
High operating costs
– Compare to the competitors, firm in the HBR case study Combating the Yoga Guru: Dabur's Dilemma 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 Patanjali Fmcg 's lucrative customers.
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.
Products dominated business model
– Even though Patanjali Fmcg has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Combating the Yoga Guru: Dabur's Dilemma should strive to include more intangible value offerings along with its core products and services.
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.
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.
Lack of clear differentiation of Patanjali Fmcg products
– To increase the profitability and margins on the products, Patanjali Fmcg needs to provide more differentiated products than what it is currently offering in the marketplace.
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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Combating the Yoga Guru: Dabur's Dilemma, it seems that the employees of Patanjali Fmcg 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Combating the Yoga Guru: Dabur's Dilemma 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 Patanjali Fmcg has relatively successful track record of launching new products.
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.
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 -
Creating value in data economy
– The success of analytics program of Patanjali Fmcg has opened avenues for new revenue streams for the organization in the industry. This can help Patanjali Fmcg to build a more holistic ecosystem as suggested in the Combating the Yoga Guru: Dabur's Dilemma case study. Patanjali Fmcg can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Patanjali Fmcg is facing challenges because of the dominance of functional experts in the organization. Combating the Yoga Guru: Dabur's Dilemma 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.
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.
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.
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.
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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Global Business industry, but it has also influenced the consumer preferences. Patanjali Fmcg can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Patanjali Fmcg 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, Combating the Yoga Guru: Dabur's Dilemma, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Global Business industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Patanjali Fmcg 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. Patanjali Fmcg 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.
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.
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.
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 -
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.
Stagnating economy with rate increase
– Patanjali Fmcg 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.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Patanjali Fmcg with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
Consumer confidence and its impact on Patanjali Fmcg 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.
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 .
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 .
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Patanjali Fmcg in the Global Business industry. The Global Business 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.
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.
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.
High dependence on third party suppliers
– Patanjali Fmcg high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Weighted SWOT Analysis of 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.