Swot Analysis of "Mary Kay Cosmetics, Inc.: Sales Force Incentives (B)" written by Robert L. Simons, Hilary A. Weston includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Vip Kay facing as an external strategic factors. Some of the topics covered in Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) case study are - Strategic Management Strategies, Corporate governance, Motivating people, Sales, Strategic planning and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) casestudy better are - – there is backlash against globalization, central banks are concerned over increasing inflation, increasing government debt because of Covid-19 spendings, supply chains are disrupted by pandemic , customer relationship management is fast transforming because of increasing concerns over data privacy, there is increasing trade war between United States & China, talent flight as more people leaving formal jobs,
increasing energy prices, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Mary Kay Cosmetics, Inc.: Sales Force Incentives (B)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Vip Kay, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Vip Kay 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 Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) can be done for the following purposes –
1. Strategic planning using facts provided in Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) case study
2. Improving business portfolio management of Vip Kay
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 Vip Kay
Strengths Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Vip Kay in Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of Vip Kay in the sector have low bargaining power. Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Vip Kay to manage not only supply disruptions but also source products at highly competitive prices.
Successful track record of launching new products
– Vip Kay has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Vip Kay 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.
Highly skilled collaborators
– Vip Kay 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 Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Sustainable margins compare to other players in Finance & Accounting industry
– Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) firm has clearly differentiated products in the market place. This has enabled Vip Kay to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Vip Kay to invest into research and development (R&D) and innovation.
High switching costs
– The high switching costs that Vip Kay 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.
Cross disciplinary teams
– Horizontal connected teams at the Vip Kay 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.
Diverse revenue streams
– Vip Kay is present in almost all the verticals within the industry. This has provided firm in Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) 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.
Innovation driven organization
– Vip Kay is one of the most innovative firm in sector. Manager in Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Ability to recruit top talent
– Vip Kay is one of the leading recruiters in the industry. Managers in the Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Superior customer experience
– The customer experience strategy of Vip Kay in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Learning organization
- Vip Kay 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 Vip Kay is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Analytics focus
– Vip Kay 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 Robert L. Simons, Hilary A. Weston 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.
Weaknesses Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) are -
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 Vip Kay supply chain. Even after few cautionary changes mentioned in the HBR case study - Mary Kay Cosmetics, Inc.: Sales Force Incentives (B), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Vip Kay vulnerable to further global disruptions in South East Asia.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Mary Kay Cosmetics, Inc.: Sales Force Incentives (B), it seems that the employees of Vip Kay 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.
Capital Spending Reduction
– Even during the low interest decade, Vip Kay has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Vip Kay is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Interest costs
– Compare to the competition, Vip Kay 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 operating costs
– Compare to the competitors, firm in the HBR case study Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) 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 Vip Kay 's lucrative customers.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) 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 Vip Kay has relatively successful track record of launching new products.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Mary Kay Cosmetics, Inc.: Sales Force Incentives (B), is just above the industry average. Vip Kay needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Aligning sales with marketing
– It come across in the case study Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) 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 Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) can leverage the sales team experience to cultivate customer relationships as Vip Kay is planning to shift buying processes online.
Increasing silos among functional specialists
– The organizational structure of Vip Kay is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Vip Kay needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Vip Kay to focus more on services rather than just following the product oriented approach.
High bargaining power of channel partners
– Because of the regulatory requirements, Robert L. Simons, Hilary A. Weston suggests that, Vip Kay 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 Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) | 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 Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) are -
Building a culture of innovation
– managers at Vip Kay 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Vip Kay 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Vip Kay 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.
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 Vip Kay 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Vip Kay can use these opportunities to build new business models that can help the communities that Vip Kay operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
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. Vip Kay can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Buying journey improvements
– Vip Kay can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) 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.
Creating value in data economy
– The success of analytics program of Vip Kay has opened avenues for new revenue streams for the organization in the industry. This can help Vip Kay to build a more holistic ecosystem as suggested in the Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) case study. Vip Kay can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Learning at scale
– Online learning technologies has now opened space for Vip Kay 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.
Better consumer reach
– The expansion of the 5G network will help Vip Kay to increase its market reach. Vip Kay will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Manufacturing automation
– Vip Kay can use the latest technology developments to improve its manufacturing and designing process in Finance & Accounting segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Vip Kay is facing challenges because of the dominance of functional experts in the organization. Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) 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.
Leveraging digital technologies
– Vip Kay 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.
Threats Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) are -
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Vip Kay with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Vip Kay.
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 Vip Kay in the Finance & Accounting sector and impact the bottomline of the organization.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Vip Kay in the Finance & Accounting industry. The Finance & Accounting 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. Vip Kay needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
Easy access to finance
– Easy access to finance in Finance & Accounting field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Vip Kay can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Vip Kay 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.
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 Vip Kay business can come under increasing regulations regarding data privacy, data security, etc.
Increasing wage structure of Vip Kay
– 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 Vip Kay.
Technology acceleration in Forth Industrial Revolution
– Vip Kay has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Vip Kay needs to keep up with the evolution of technology in the Finance & Accounting 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.
High dependence on third party suppliers
– Vip Kay 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Mary Kay Cosmetics, Inc.: Sales Force Incentives (B), Vip Kay 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 .
Weighted SWOT Analysis of Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) 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 Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) 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 Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) 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 Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) 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 Mary Kay Cosmetics, Inc.: Sales Force Incentives (B) 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 Vip Kay needs to make to build a sustainable competitive advantage.
