Steel String: To Bottle or Not to Bottle SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Steel String: To Bottle or Not to Bottle
By July of 2016, the craft brewery Steel String had established a successful pub in downtown Carrboro, North Carolina, near the University of North Carolina at Chapel Hill campus. With an active craft-brewing scene, North Carolina had lots of people looking for good, local beer in bars, restaurants, and bottle shops. Therefore, it was not surprising that Steel String had faced fierce competition from other craft breweries in their first few years of operation. However, the three owners' determination led to continued growth, which allowed them to hire three other regular employees and several bartenders who worked one or two shifts per week. However, at the start of 2017, the co-owners had been grappling with several questions: Should they invest in the machinery and labour to start bottling their beer? Should they consider different pricing strategies? And finally, what ways could they give back to their community through their social responsibility efforts? The authors Carri R. Tolmie and Thomas Tiemann are affiliated with Elon University.
Swot Analysis of "Steel String: To Bottle or Not to Bottle" written by Carri R. Tolmie, Thomas Tiemann includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that String Bottle facing as an external strategic factors. Some of the topics covered in Steel String: To Bottle or Not to Bottle case study are - Strategic Management Strategies, Strategy, Sustainability and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Steel String: To Bottle or Not to Bottle casestudy better are - – wage bills are increasing, there is increasing trade war between United States & China, customer relationship management is fast transforming because of increasing concerns over data privacy, there is backlash against globalization, talent flight as more people leaving formal jobs, supply chains are disrupted by pandemic , central banks are concerned over increasing inflation,
digital marketing is dominated by two big players Facebook and Google, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of Steel String: To Bottle or Not to Bottle
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Steel String: To Bottle or Not to Bottle case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the String Bottle, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which String Bottle 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 Steel String: To Bottle or Not to Bottle can be done for the following purposes –
1. Strategic planning using facts provided in Steel String: To Bottle or Not to Bottle case study
2. Improving business portfolio management of String Bottle
3. Assessing feasibility of the new initiative in Innovation & Entrepreneurship field.
4. Making a Innovation & Entrepreneurship topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of String Bottle
Strengths Steel String: To Bottle or Not to Bottle | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of String Bottle in Steel String: To Bottle or Not to Bottle Harvard Business Review case study are -
Cross disciplinary teams
– Horizontal connected teams at the String Bottle 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.
Digital Transformation in Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For String Bottle digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. String Bottle 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 brand equity
– String Bottle has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled String Bottle to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– String Bottle is one of the most innovative firm in sector. Manager in Steel String: To Bottle or Not to Bottle Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Training and development
– String Bottle has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Steel String: To Bottle or Not to Bottle 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.
Successful track record of launching new products
– String Bottle has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. String Bottle 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.
Analytics focus
– String Bottle 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 Carri R. Tolmie, Thomas Tiemann 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.
Learning organization
- String Bottle 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 String Bottle is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Steel String: To Bottle or Not to Bottle Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Superior customer experience
– The customer experience strategy of String Bottle in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– Steel String: To Bottle or Not to Bottle firm has clearly differentiated products in the market place. This has enabled String Bottle to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped String Bottle to invest into research and development (R&D) and innovation.
Organizational Resilience of String Bottle
– The covid-19 pandemic has put organizational resilience at the centre of everthing that String Bottle does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Strong track record of project management
– String Bottle is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses Steel String: To Bottle or Not to Bottle | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Steel String: To Bottle or Not to Bottle are -
Capital Spending Reduction
– Even during the low interest decade, String Bottle 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.
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 String Bottle supply chain. Even after few cautionary changes mentioned in the HBR case study - Steel String: To Bottle or Not to Bottle, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left String Bottle vulnerable to further global disruptions in South East Asia.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Steel String: To Bottle or Not to Bottle, in the dynamic environment String Bottle has struggled to respond to the nimble upstart competition. String Bottle has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Steel String: To Bottle or Not to Bottle 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 String Bottle has relatively successful track record of launching new products.
High cash cycle compare to competitors
String Bottle has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Workers concerns about automation
– As automation is fast increasing in the segment, String Bottle 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.
Need for greater diversity
– String Bottle 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Steel String: To Bottle or Not to Bottle 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 String Bottle 's lucrative customers.
Lack of clear differentiation of String Bottle products
– To increase the profitability and margins on the products, String Bottle needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to strategic competitive environment developments
– As Steel String: To Bottle or Not to Bottle HBR case study mentions - String Bottle 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.
Skills based hiring
– The stress on hiring functional specialists at String Bottle has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Opportunities Steel String: To Bottle or Not to Bottle | 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 Steel String: To Bottle or Not to Bottle are -
Buying journey improvements
– String Bottle can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Steel String: To Bottle or Not to Bottle 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 String Bottle in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Innovation & Entrepreneurship segment, and it will provide faster access to the consumers.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, String Bottle 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, Steel String: To Bottle or Not to Bottle, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, String Bottle can use these opportunities to build new business models that can help the communities that String Bottle operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Loyalty marketing
– String Bottle 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Innovation & Entrepreneurship industry, but it has also influenced the consumer preferences. String Bottle can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects String Bottle can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Building a culture of innovation
– managers at String Bottle 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 Innovation & Entrepreneurship segment.
Low interest rates
– Even though inflation is raising its head in most developed economies, String Bottle 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.
Using analytics as competitive advantage
– String Bottle 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 Steel String: To Bottle or Not to Bottle - to build a competitive advantage using analytics. The analytics driven competitive advantage can help String Bottle to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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 String Bottle 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.
Creating value in data economy
– The success of analytics program of String Bottle has opened avenues for new revenue streams for the organization in the industry. This can help String Bottle to build a more holistic ecosystem as suggested in the Steel String: To Bottle or Not to Bottle case study. String Bottle can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for String Bottle 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 String Bottle to hire the very best people irrespective of their geographical location.
Threats Steel String: To Bottle or Not to Bottle External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Steel String: To Bottle or Not to Bottle are -
Stagnating economy with rate increase
– String Bottle can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Increasing wage structure of String Bottle
– 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 String Bottle.
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. String Bottle 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.
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 String Bottle in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Steel String: To Bottle or Not to Bottle, String Bottle may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Innovation & Entrepreneurship .
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.
Shortening product life cycle
– it is one of the major threat that String Bottle is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, String Bottle 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 Steel String: To Bottle or Not to Bottle .
High dependence on third party suppliers
– String Bottle 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.
Consumer confidence and its impact on String Bottle 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.
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 String Bottle business can come under increasing regulations regarding data privacy, data security, etc.
Easy access to finance
– Easy access to finance in Innovation & Entrepreneurship field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. String Bottle can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
Weighted SWOT Analysis of Steel String: To Bottle or Not to Bottle 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 Steel String: To Bottle or Not to Bottle 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 Steel String: To Bottle or Not to Bottle 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 Steel String: To Bottle or Not to Bottle 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 Steel String: To Bottle or Not to Bottle 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 String Bottle needs to make to build a sustainable competitive advantage.
