For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

Case Study SWOT Analysis Solution

Case Study Description of For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise

The London, Ontario, social enterprise For the Love of Laundry was founded in 2014 with the intention of selling homemade, eco-friendly soaps and using the profits to fund free laundry events in the community. In 2017, the founder's goal was to increase the scale of the business and its social impact. She needed to decide how to structure the organization to increase its scale while maintaining control of its strategic direction. The founder compared the pros and cons of the four organizational structures available for social enterprises in Canada-for-profit organization, non-profit organization, registered charity, and co-operative-to decide which option would best suit the organization. She wanted to ensure that the organization's social aspect remained central while she sought funds to increase its scale. She needed to balance the triple bottom line, but with a primary focus on the social component. She also needed to consider the importance of corporate identity for social enterprises in the scaling process. Kent Walker is affiliated with University of Windsor.

Authors :: Kent Walker, Ian Stecher, Francine Schlosser, Megain O'Neil-Renaud

Topics :: Innovation & Entrepreneurship

Tags :: Social enterprise, SWOT Analysis, SWOT Matrix, TOWS, Weighted SWOT Analysis

Swot Analysis of "For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise" written by Kent Walker, Ian Stecher, Francine Schlosser, Megain O'Neil-Renaud includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Laundry Social facing as an external strategic factors. Some of the topics covered in For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise case study are - Strategic Management Strategies, Social enterprise and Innovation & Entrepreneurship.

Some of the macro environment factors that can be used to understand the For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise casestudy better are - – increasing transportation and logistics costs, central banks are concerned over increasing inflation, competitive advantages are harder to sustain because of technology dispersion, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing commodity prices, technology disruption, there is backlash against globalization, increasing household debt because of falling income levels, challanges to central banks by blockchain based private currencies, etc

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Introduction to SWOT Analysis of For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Laundry Social, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Laundry Social 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise can be done for the following purposes –
1. Strategic planning using facts provided in For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise case study
2. Improving business portfolio management of Laundry Social
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 Laundry Social

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Strengths For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Laundry Social in For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise Harvard Business Review case study are -

Innovation driven organization

– Laundry Social is one of the most innovative firm in sector. Manager in For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.

Digital Transformation in Innovation & Entrepreneurship segment

- digital transformation varies from industry to industry. For Laundry Social digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Laundry Social 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.

Diverse revenue streams

– Laundry Social is present in almost all the verticals within the industry. This has provided firm in For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise 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.

Ability to lead change in Innovation & Entrepreneurship field

– Laundry Social 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 Laundry Social in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

Sustainable margins compare to other players in Innovation & Entrepreneurship industry

– For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise firm has clearly differentiated products in the market place. This has enabled Laundry Social to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Laundry Social to invest into research and development (R&D) and innovation.

High brand equity

– Laundry Social has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Laundry Social to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Successful track record of launching new products

– Laundry Social has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Laundry Social 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.

Organizational Resilience of Laundry Social

– The covid-19 pandemic has put organizational resilience at the centre of everthing that Laundry Social does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.

Low bargaining power of suppliers

– Suppliers of Laundry Social in the sector have low bargaining power. For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Laundry Social to manage not only supply disruptions but also source products at highly competitive prices.

Strong track record of project management

– Laundry Social is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Analytics focus

– Laundry Social 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 Kent Walker, Ian Stecher, Francine Schlosser, Megain O'Neil-Renaud 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.

High switching costs

– The high switching costs that Laundry Social 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.

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Weaknesses For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise are -

Low market penetration in new markets

– Outside its home market of Laundry Social, firm in the HBR case study For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.

Skills based hiring

– The stress on hiring functional specialists at Laundry Social 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.

Interest costs

– Compare to the competition, Laundry Social 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 For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise HBR case study mentions - Laundry Social 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.

Employees’ incomplete understanding of strategy

– From the instances in the HBR case study For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise, it seems that the employees of Laundry Social 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 cash cycle compare to competitors

Laundry Social 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.

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 Laundry Social supply chain. Even after few cautionary changes mentioned in the HBR case study - For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Laundry Social vulnerable to further global disruptions in South East Asia.

Compensation and incentives

– The revenue per employee as mentioned in the HBR case study For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise, is just above the industry average. Laundry Social 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.

Increasing silos among functional specialists

– The organizational structure of Laundry Social is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Laundry Social needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Laundry Social to focus more on services rather than just following the product oriented approach.

Need for greater diversity

– Laundry Social 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 dependence on star products

– The top 2 products and services of the firm as mentioned in the For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise 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 Laundry Social has relatively successful track record of launching new products.

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Opportunities For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise | 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 For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise are -

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. Laundry Social can explore opportunities that can attract volunteers and are consistent with its mission and vision.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Laundry Social can use these opportunities to build new business models that can help the communities that Laundry Social operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Laundry Social 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 Laundry Social to hire the very best people irrespective of their geographical location.

Reconfiguring business model

– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Laundry Social 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.

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, Laundry Social 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, For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

Learning at scale

– Online learning technologies has now opened space for Laundry Social 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.

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 Laundry Social in the consumer business. Now Laundry Social can target international markets with far fewer capital restrictions requirements than the existing system.

Creating value in data economy

– The success of analytics program of Laundry Social has opened avenues for new revenue streams for the organization in the industry. This can help Laundry Social to build a more holistic ecosystem as suggested in the For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise case study. Laundry Social can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.

Leveraging digital technologies

– Laundry Social 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.

Using analytics as competitive advantage

– Laundry Social 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 For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Laundry Social 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 Innovation & Entrepreneurship industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Laundry Social 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. Laundry Social 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.

Lowering marketing communication costs

– 5G expansion will open new opportunities for Laundry Social 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.

Better consumer reach

– The expansion of the 5G network will help Laundry Social to increase its market reach. Laundry Social 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.

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Threats For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats mentioned in the HBR case study For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise are -

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 Laundry Social in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.

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. Laundry Social can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Laundry Social 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 Laundry Social.

Regulatory challenges

– Laundry Social 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 Innovation & Entrepreneurship industry regulations.

Shortening product life cycle

– it is one of the major threat that Laundry Social is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

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. Laundry Social 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.

Stagnating economy with rate increase

– Laundry Social 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.

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.

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 Laundry Social business can come under increasing regulations regarding data privacy, data security, etc.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Laundry Social in the Innovation & Entrepreneurship industry. The Innovation & Entrepreneurship 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.

Technology acceleration in Forth Industrial Revolution

– Laundry Social has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Laundry Social needs to keep up with the evolution of technology in the Innovation & Entrepreneurship 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 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. Laundry Social needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.

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Weighted SWOT Analysis of For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise 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 For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise 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 For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise 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 For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise 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 For the Love of Laundry: Comparing Organizational Forms to Scale a Social Enterprise 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 Laundry Social needs to make to build a sustainable competitive advantage.

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