Case Study Description of Kangaroo Tail Winery Limited (C)
Supplement to case TB0499. Two Australian entrepreneurs, Anna Amphlett and Andrew Ferris decided to start a new venture to produce, market and distribute high quality premium wine in Tasmania, an island off the southern coast of Australia. Amphlett and Ferris developed a business plan for a winery business based on a new brand to be called Kangaroo Tail. Amphlett and Ferris were retired executives each with more than twenty years of experience at Constellation Brands Inc. and Treasury Wine Estates. After a year of experimentation, Amphlett and Ferris finally settled upon a blend that yielded wines with the right aroma, taste, and color. They negotiated a loan requiring them to provide the bank with a business plan and projected financial statements. They are unsure whether the wine operation will be a profitable use of their capital.
Swot Analysis of "Kangaroo Tail Winery Limited (C)" written by Graeme Rankine includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Ferris Amphlett facing as an external strategic factors. Some of the topics covered in Kangaroo Tail Winery Limited (C) case study are - Strategic Management Strategies, Performance measurement and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Kangaroo Tail Winery Limited (C) casestudy better are - – wage bills are increasing, cloud computing is disrupting traditional business models, supply chains are disrupted by pandemic , increasing government debt because of Covid-19 spendings, increasing commodity prices, talent flight as more people leaving formal jobs, geopolitical disruptions,
increasing transportation and logistics costs, banking and financial system is disrupted by Bitcoin and other crypto currencies, etc
Introduction to SWOT Analysis of Kangaroo Tail Winery Limited (C)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Kangaroo Tail Winery Limited (C) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Ferris Amphlett, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Ferris Amphlett 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 Kangaroo Tail Winery Limited (C) can be done for the following purposes –
1. Strategic planning using facts provided in Kangaroo Tail Winery Limited (C) case study
2. Improving business portfolio management of Ferris Amphlett
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 Ferris Amphlett
Strengths Kangaroo Tail Winery Limited (C) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Ferris Amphlett in Kangaroo Tail Winery Limited (C) Harvard Business Review case study are -
Effective Research and Development (R&D)
– Ferris Amphlett 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 Kangaroo Tail Winery Limited (C) - 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 Kangaroo Tail Winery Limited (C) 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.
Highly skilled collaborators
– Ferris Amphlett 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 Kangaroo Tail Winery Limited (C) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High brand equity
– Ferris Amphlett has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Ferris Amphlett to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in Finance & Accounting industry
– Kangaroo Tail Winery Limited (C) firm has clearly differentiated products in the market place. This has enabled Ferris Amphlett to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Ferris Amphlett to invest into research and development (R&D) and innovation.
Organizational Resilience of Ferris Amphlett
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Ferris Amphlett does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Ferris Amphlett digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Ferris Amphlett 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.
High switching costs
– The high switching costs that Ferris Amphlett 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
– Ferris Amphlett is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Learning organization
- Ferris Amphlett 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 Ferris Amphlett is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Kangaroo Tail Winery Limited (C) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to lead change in Finance & Accounting field
– Ferris Amphlett 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 Ferris Amphlett in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Diverse revenue streams
– Ferris Amphlett is present in almost all the verticals within the industry. This has provided firm in Kangaroo Tail Winery Limited (C) 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.
Weaknesses Kangaroo Tail Winery Limited (C) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Kangaroo Tail Winery Limited (C) are -
Lack of clear differentiation of Ferris Amphlett products
– To increase the profitability and margins on the products, Ferris Amphlett needs to provide more differentiated products than what it is currently offering in the marketplace.
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 Ferris Amphlett supply chain. Even after few cautionary changes mentioned in the HBR case study - Kangaroo Tail Winery Limited (C), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Ferris Amphlett vulnerable to further global disruptions in South East Asia.
Low market penetration in new markets
– Outside its home market of Ferris Amphlett, firm in the HBR case study Kangaroo Tail Winery Limited (C) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High bargaining power of channel partners
– Because of the regulatory requirements, Graeme Rankine suggests that, Ferris Amphlett 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.
Interest costs
– Compare to the competition, Ferris Amphlett 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.
Slow to strategic competitive environment developments
– As Kangaroo Tail Winery Limited (C) HBR case study mentions - Ferris Amphlett 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.
No frontier risks strategy
– After analyzing the HBR case study Kangaroo Tail Winery Limited (C), it seems that company is thinking about the frontier risks that can impact Finance & Accounting strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Kangaroo Tail Winery Limited (C) 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 Ferris Amphlett has relatively successful track record of launching new products.
Need for greater diversity
– Ferris Amphlett 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, Ferris Amphlett 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.
Increasing silos among functional specialists
– The organizational structure of Ferris Amphlett is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Ferris Amphlett needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Ferris Amphlett to focus more on services rather than just following the product oriented approach.
Opportunities Kangaroo Tail Winery Limited (C) | 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 Kangaroo Tail Winery Limited (C) are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Ferris Amphlett 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.
Manufacturing automation
– Ferris Amphlett 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.
Using analytics as competitive advantage
– Ferris Amphlett 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 Kangaroo Tail Winery Limited (C) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Ferris Amphlett to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Learning at scale
– Online learning technologies has now opened space for Ferris Amphlett 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.
Loyalty marketing
– Ferris Amphlett 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.
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 Ferris Amphlett in the consumer business. Now Ferris Amphlett can target international markets with far fewer capital restrictions requirements than the existing system.
Better consumer reach
– The expansion of the 5G network will help Ferris Amphlett to increase its market reach. Ferris Amphlett 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.
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. Ferris Amphlett 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. Ferris Amphlett 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Ferris Amphlett 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, Kangaroo Tail Winery Limited (C), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Creating value in data economy
– The success of analytics program of Ferris Amphlett has opened avenues for new revenue streams for the organization in the industry. This can help Ferris Amphlett to build a more holistic ecosystem as suggested in the Kangaroo Tail Winery Limited (C) case study. Ferris Amphlett can build new products and services such as - data insight services, data privacy related products, data based consulting services, 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. Ferris Amphlett can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Low interest rates
– Even though inflation is raising its head in most developed economies, Ferris Amphlett 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.
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. Ferris Amphlett can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats Kangaroo Tail Winery Limited (C) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Kangaroo Tail Winery Limited (C) are -
Consumer confidence and its impact on Ferris Amphlett 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Ferris Amphlett 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 Kangaroo Tail Winery Limited (C) .
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. Ferris Amphlett needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
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.
Stagnating economy with rate increase
– Ferris Amphlett 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.
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 Ferris Amphlett in the Finance & Accounting sector and impact the bottomline of the organization.
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. Ferris Amphlett 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.
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. Ferris Amphlett can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Ferris Amphlett business can come under increasing regulations regarding data privacy, data security, etc.
Regulatory challenges
– Ferris Amphlett 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 Finance & Accounting industry regulations.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Ferris Amphlett 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.
Increasing wage structure of Ferris Amphlett
– 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 Ferris Amphlett.
Technology acceleration in Forth Industrial Revolution
– Ferris Amphlett has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Ferris Amphlett 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.
Weighted SWOT Analysis of Kangaroo Tail Winery Limited (C) 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 Kangaroo Tail Winery Limited (C) 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 Kangaroo Tail Winery Limited (C) 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 Kangaroo Tail Winery Limited (C) 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 Kangaroo Tail Winery Limited (C) 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 Ferris Amphlett needs to make to build a sustainable competitive advantage.
