ShopClues.com: Turning Logistics into a Competitive Advantage SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of ShopClues.com: Turning Logistics into a Competitive Advantage
In March 2016, the senior director of logistics and fulfillment at ShopClues.com, a leading online marketplace headquartered in Gurgaon, India, reflected on the positive turnaround in the company's logistics strategy. Until 2014, the company had depended on air transport for shipment delivery, which limited it to Tier 1, Tier 2, and a few Tier 3 cities. It had relied entirely on the few national courier services available. These services had high logistics costs and could not reach customers in some tier 3 and tier 4 cities, preventing these customers from placing orders and leading to dissatisfaction. ShopClues.com switched to surface transport and a network of third-party logistics service providers to meet its requirements in a cost-effective manner. With evolving customer expectations for online retail sales and fierce competition in the e-commerce market, could ShopClues.com become the first profitable e-commerce company with third-party logistics partnerships as the key enabler? Anupama Prashar is affiliated with Management Development Institute.
Swot Analysis of "ShopClues.com: Turning Logistics into a Competitive Advantage" written by Anupama Prashar includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Shopclues.com Logistics facing as an external strategic factors. Some of the topics covered in ShopClues.com: Turning Logistics into a Competitive Advantage case study are - Strategic Management Strategies, Operations management and Technology & Operations.
Some of the macro environment factors that can be used to understand the ShopClues.com: Turning Logistics into a Competitive Advantage casestudy better are - – increasing commodity prices, competitive advantages are harder to sustain because of technology dispersion, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing inequality as vast percentage of new income is going to the top 1%, banking and financial system is disrupted by Bitcoin and other crypto currencies, there is increasing trade war between United States & China, increasing household debt because of falling income levels,
increasing transportation and logistics costs, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of ShopClues.com: Turning Logistics into a Competitive Advantage
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in ShopClues.com: Turning Logistics into a Competitive Advantage case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Shopclues.com Logistics, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Shopclues.com Logistics 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 ShopClues.com: Turning Logistics into a Competitive Advantage can be done for the following purposes –
1. Strategic planning using facts provided in ShopClues.com: Turning Logistics into a Competitive Advantage case study
2. Improving business portfolio management of Shopclues.com Logistics
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 Shopclues.com Logistics
Strengths ShopClues.com: Turning Logistics into a Competitive Advantage | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Shopclues.com Logistics in ShopClues.com: Turning Logistics into a Competitive Advantage Harvard Business Review case study are -
Learning organization
- Shopclues.com Logistics 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 Shopclues.com Logistics is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in ShopClues.com: Turning Logistics into a Competitive Advantage Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Superior customer experience
– The customer experience strategy of Shopclues.com Logistics in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Analytics focus
– Shopclues.com Logistics 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 Anupama Prashar 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.
Training and development
– Shopclues.com Logistics has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in ShopClues.com: Turning Logistics into a Competitive Advantage 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.
High brand equity
– Shopclues.com Logistics has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Shopclues.com Logistics to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to lead change in Technology & Operations field
– Shopclues.com Logistics 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 Shopclues.com Logistics in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Operational resilience
– The operational resilience strategy in the ShopClues.com: Turning Logistics into a Competitive Advantage 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.
Sustainable margins compare to other players in Technology & Operations industry
– ShopClues.com: Turning Logistics into a Competitive Advantage firm has clearly differentiated products in the market place. This has enabled Shopclues.com Logistics to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Shopclues.com Logistics to invest into research and development (R&D) and innovation.
Ability to recruit top talent
– Shopclues.com Logistics is one of the leading recruiters in the industry. Managers in the ShopClues.com: Turning Logistics into a Competitive Advantage are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Organizational Resilience of Shopclues.com Logistics
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Shopclues.com Logistics does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Shopclues.com Logistics digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Shopclues.com Logistics 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.
Highly skilled collaborators
– Shopclues.com Logistics 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 ShopClues.com: Turning Logistics into a Competitive Advantage HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses ShopClues.com: Turning Logistics into a Competitive Advantage | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of ShopClues.com: Turning Logistics into a Competitive Advantage are -
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study ShopClues.com: Turning Logistics into a Competitive Advantage, it seems that the employees of Shopclues.com Logistics 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.
Interest costs
– Compare to the competition, Shopclues.com Logistics has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the ShopClues.com: Turning Logistics into a Competitive Advantage 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 Shopclues.com Logistics has relatively successful track record of launching new products.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Shopclues.com Logistics is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study ShopClues.com: Turning Logistics into a Competitive Advantage can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Lack of clear differentiation of Shopclues.com Logistics products
– To increase the profitability and margins on the products, Shopclues.com Logistics needs to provide more differentiated products than what it is currently offering in the marketplace.
High operating costs
– Compare to the competitors, firm in the HBR case study ShopClues.com: Turning Logistics into a Competitive Advantage 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 Shopclues.com Logistics 's lucrative customers.
Increasing silos among functional specialists
– The organizational structure of Shopclues.com Logistics is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Shopclues.com Logistics needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Shopclues.com Logistics to focus more on services rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As ShopClues.com: Turning Logistics into a Competitive Advantage HBR case study mentions - Shopclues.com Logistics 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.
Products dominated business model
– Even though Shopclues.com Logistics 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 - ShopClues.com: Turning Logistics into a Competitive Advantage should strive to include more intangible value offerings along with its core products and services.
Need for greater diversity
– Shopclues.com Logistics 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.
Capital Spending Reduction
– Even during the low interest decade, Shopclues.com Logistics 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 ShopClues.com: Turning Logistics into a Competitive Advantage | 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 ShopClues.com: Turning Logistics into a Competitive Advantage are -
Using analytics as competitive advantage
– Shopclues.com Logistics 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 ShopClues.com: Turning Logistics into a Competitive Advantage - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Shopclues.com Logistics to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Shopclues.com Logistics can use these opportunities to build new business models that can help the communities that Shopclues.com Logistics operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Shopclues.com Logistics is facing challenges because of the dominance of functional experts in the organization. ShopClues.com: Turning Logistics into a Competitive Advantage 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.
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. Shopclues.com Logistics can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Shopclues.com Logistics 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, ShopClues.com: Turning Logistics into a Competitive Advantage, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Shopclues.com Logistics 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 Shopclues.com Logistics to hire the very best people irrespective of their geographical location.
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 Shopclues.com Logistics 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Shopclues.com Logistics 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
– Shopclues.com Logistics 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.
Leveraging digital technologies
– Shopclues.com Logistics 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.
Learning at scale
– Online learning technologies has now opened space for Shopclues.com Logistics 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Shopclues.com Logistics in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Technology & Operations segment, and it will provide faster access to the consumers.
Creating value in data economy
– The success of analytics program of Shopclues.com Logistics has opened avenues for new revenue streams for the organization in the industry. This can help Shopclues.com Logistics to build a more holistic ecosystem as suggested in the ShopClues.com: Turning Logistics into a Competitive Advantage case study. Shopclues.com Logistics can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats ShopClues.com: Turning Logistics into a Competitive Advantage External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study ShopClues.com: Turning Logistics into a Competitive Advantage are -
Stagnating economy with rate increase
– Shopclues.com Logistics 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study ShopClues.com: Turning Logistics into a Competitive Advantage, Shopclues.com Logistics may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Technology & Operations .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Shopclues.com Logistics 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.
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. Shopclues.com Logistics needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
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. Shopclues.com Logistics 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.
Regulatory challenges
– Shopclues.com Logistics 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Shopclues.com Logistics 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 ShopClues.com: Turning Logistics into a 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.
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.
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 Shopclues.com Logistics.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Shopclues.com Logistics in the Technology & Operations sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– Shopclues.com Logistics has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Shopclues.com Logistics 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.
Increasing wage structure of Shopclues.com Logistics
– 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 Shopclues.com Logistics.
Weighted SWOT Analysis of ShopClues.com: Turning Logistics into a Competitive Advantage 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 ShopClues.com: Turning Logistics into a Competitive Advantage 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 ShopClues.com: Turning Logistics into a Competitive Advantage 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 ShopClues.com: Turning Logistics into a Competitive Advantage 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 ShopClues.com: Turning Logistics into a Competitive Advantage 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 Shopclues.com Logistics needs to make to build a sustainable competitive advantage.
