Bega Cheese: Bidding to Bring Vegemite Back Home SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Bega Cheese: Bidding to Bring Vegemite Back Home
In January 2017, the leadership team of Bega Cheese-the Australian dairy company-was considering a bid for MondelA?z International's Australia and New Zealand (ANZ) grocery business which included several leading consumer brands such as Vegemite, the iconic Australian spread. The team must decide whether to bid for the division and, if so, how much to offer and how to finance the all-cash bid. Making these decisions was difficult because this would be Bega's largest acquisition ever and it would extend the firm outside of its core dairy business. In addition to the valuation and financing issues, the leadership team must decide whether shifting from the firm's current B2B business model (manufacturing and processing dairy products) to more of a B2C business model (a producer of branded consumer foods) made sense strategically.
Swot Analysis of "Bega Cheese: Bidding to Bring Vegemite Back Home" written by Benjamin C. Esty, Lauren G. Pickle includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Bega Vegemite facing as an external strategic factors. Some of the topics covered in Bega Cheese: Bidding to Bring Vegemite Back Home case study are - Strategic Management Strategies, Branding, Financial analysis, Financial management, Growth strategy, Mergers & acquisitions, Negotiations, Risk management and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Bega Cheese: Bidding to Bring Vegemite Back Home casestudy better are - – cloud computing is disrupting traditional business models, there is increasing trade war between United States & China, increasing inequality as vast percentage of new income is going to the top 1%, increasing energy prices, wage bills are increasing, talent flight as more people leaving formal jobs, there is backlash against globalization,
customer relationship management is fast transforming because of increasing concerns over data privacy, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of Bega Cheese: Bidding to Bring Vegemite Back Home
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Bega Cheese: Bidding to Bring Vegemite Back Home case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Bega Vegemite, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Bega Vegemite 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 Bega Cheese: Bidding to Bring Vegemite Back Home can be done for the following purposes –
1. Strategic planning using facts provided in Bega Cheese: Bidding to Bring Vegemite Back Home case study
2. Improving business portfolio management of Bega Vegemite
3. Assessing feasibility of the new initiative in Finance & Accounting field.
4. Making a Finance & Accounting topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Bega Vegemite
Strengths Bega Cheese: Bidding to Bring Vegemite Back Home | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Bega Vegemite in Bega Cheese: Bidding to Bring Vegemite Back Home Harvard Business Review case study are -
Learning organization
- Bega Vegemite 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 Bega Vegemite is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Bega Cheese: Bidding to Bring Vegemite Back Home Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– Bega Vegemite is one of the leading recruiters in the industry. Managers in the Bega Cheese: Bidding to Bring Vegemite Back Home are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Low bargaining power of suppliers
– Suppliers of Bega Vegemite in the sector have low bargaining power. Bega Cheese: Bidding to Bring Vegemite Back Home has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Bega Vegemite to manage not only supply disruptions but also source products at highly competitive prices.
Operational resilience
– The operational resilience strategy in the Bega Cheese: Bidding to Bring Vegemite Back Home 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.
Organizational Resilience of Bega Vegemite
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Bega Vegemite does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– Bega Vegemite has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Bega Cheese: Bidding to Bring Vegemite Back Home 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 switching costs
– The high switching costs that Bega Vegemite 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.
Sustainable margins compare to other players in Finance & Accounting industry
– Bega Cheese: Bidding to Bring Vegemite Back Home firm has clearly differentiated products in the market place. This has enabled Bega Vegemite to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Bega Vegemite to invest into research and development (R&D) and innovation.
Strong track record of project management
– Bega Vegemite 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
– Bega Vegemite 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 Bega Cheese: Bidding to Bring Vegemite Back Home 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
– Bega Vegemite has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Bega Vegemite 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.
Effective Research and Development (R&D)
– Bega Vegemite 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 Bega Cheese: Bidding to Bring Vegemite Back Home - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses Bega Cheese: Bidding to Bring Vegemite Back Home | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Bega Cheese: Bidding to Bring Vegemite Back Home are -
Interest costs
– Compare to the competition, Bega Vegemite 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.
Need for greater diversity
– Bega Vegemite 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.
Products dominated business model
– Even though Bega Vegemite 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 - Bega Cheese: Bidding to Bring Vegemite Back Home should strive to include more intangible value offerings along with its core products and services.
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 Bega Vegemite supply chain. Even after few cautionary changes mentioned in the HBR case study - Bega Cheese: Bidding to Bring Vegemite Back Home, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Bega Vegemite vulnerable to further global disruptions in South East Asia.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Bega Cheese: Bidding to Bring Vegemite Back Home, it seems that the employees of Bega Vegemite 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 Bega Cheese: Bidding to Bring Vegemite Back Home 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 Bega Vegemite 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, Bega Vegemite is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Bega Cheese: Bidding to Bring Vegemite Back Home can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Low market penetration in new markets
– Outside its home market of Bega Vegemite, firm in the HBR case study Bega Cheese: Bidding to Bring Vegemite Back Home needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Workers concerns about automation
– As automation is fast increasing in the segment, Bega Vegemite 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.
Aligning sales with marketing
– It come across in the case study Bega Cheese: Bidding to Bring Vegemite Back Home 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 Bega Cheese: Bidding to Bring Vegemite Back Home can leverage the sales team experience to cultivate customer relationships as Bega Vegemite is planning to shift buying processes online.
Capital Spending Reduction
– Even during the low interest decade, Bega Vegemite 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 Bega Cheese: Bidding to Bring Vegemite Back Home | 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 Bega Cheese: Bidding to Bring Vegemite Back Home are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Bega Vegemite is facing challenges because of the dominance of functional experts in the organization. Bega Cheese: Bidding to Bring Vegemite Back Home case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Finance & Accounting industry, but it has also influenced the consumer preferences. Bega Vegemite can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Using analytics as competitive advantage
– Bega Vegemite 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 Bega Cheese: Bidding to Bring Vegemite Back Home - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Bega Vegemite to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Finance & Accounting industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Bega Vegemite 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. Bega Vegemite 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.
Learning at scale
– Online learning technologies has now opened space for Bega Vegemite 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.
Developing new processes and practices
– Bega Vegemite can develop new processes and procedures in Finance & Accounting 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.
Building a culture of innovation
– managers at Bega Vegemite 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 Finance & Accounting segment.
Buying journey improvements
– Bega Vegemite can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Bega Cheese: Bidding to Bring Vegemite Back Home 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Bega Vegemite in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Finance & Accounting segment, and it will provide faster access to the consumers.
Leveraging digital technologies
– Bega Vegemite 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, Bega Vegemite 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, Bega Cheese: Bidding to Bring Vegemite Back Home, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Bega Vegemite can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Bega Vegemite in the consumer business. Now Bega Vegemite can target international markets with far fewer capital restrictions requirements than the existing system.
Threats Bega Cheese: Bidding to Bring Vegemite Back Home External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Bega Cheese: Bidding to Bring Vegemite Back Home are -
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 Bega Vegemite.
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. Bega Vegemite needs to understand the core reasons impacting the Finance & Accounting 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. Bega Vegemite 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.
Environmental challenges
– Bega Vegemite 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. Bega Vegemite can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Bega Cheese: Bidding to Bring Vegemite Back Home, Bega Vegemite may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Finance & Accounting .
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 Bega Vegemite in the Finance & Accounting sector and impact the bottomline of the organization.
Shortening product life cycle
– it is one of the major threat that Bega Vegemite is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Consumer confidence and its impact on Bega Vegemite 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.
High dependence on third party suppliers
– Bega Vegemite 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Bega Vegemite 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 Bega Cheese: Bidding to Bring Vegemite Back Home .
Stagnating economy with rate increase
– Bega Vegemite 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.
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 Bega Vegemite business can come under increasing regulations regarding data privacy, data security, etc.
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.
Weighted SWOT Analysis of Bega Cheese: Bidding to Bring Vegemite Back Home 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 Bega Cheese: Bidding to Bring Vegemite Back Home 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 Bega Cheese: Bidding to Bring Vegemite Back Home 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 Bega Cheese: Bidding to Bring Vegemite Back Home 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 Bega Cheese: Bidding to Bring Vegemite Back Home 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 Bega Vegemite needs to make to build a sustainable competitive advantage.
