Bega Cheese: Bidding to Bring Vegemite Back Home SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Bega Cheese: Bidding to Bring Vegemite Back Home
In January 2017, the leadership team of Bega Cheese-the Australian dairy company-was considering a bid for Mondelez International's Australia and New Zealand (ANZ) grocery business which included several leading consumer brands such as Vegemite, the iconic Australian spread. The team must decide whether to bid for the division and, if so, how much to offer and how to finance the all-cash bid. Making these decisions was difficult because this would be Bega's largest acquisition ever and it would extend the firm outside of its core dairy business. In addition to the valuation and financing issues, the leadership team must decide whether shifting from the firm's current B2B business model (manufacturing and processing dairy products) to more of a B2C business model (a producer of branded consumer foods) made sense strategically.
Swot Analysis of "Bega Cheese: Bidding to Bring Vegemite Back Home" written by Benjamin C. Esty, Lauren G. Pickle includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Bega Vegemite facing as an external strategic factors. Some of the topics covered in Bega Cheese: Bidding to Bring Vegemite Back Home case study are - Strategic Management Strategies, Branding, Financial analysis, Financial management, Growth strategy, Mergers & acquisitions, Negotiations, Risk management and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Bega Cheese: Bidding to Bring Vegemite Back Home casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, there is increasing trade war between United States & China, increasing transportation and logistics costs, wage bills are increasing, supply chains are disrupted by pandemic , there is backlash against globalization, increasing energy prices,
competitive advantages are harder to sustain because of technology dispersion, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Bega Cheese: Bidding to Bring Vegemite Back Home
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Bega Cheese: Bidding to Bring Vegemite Back Home case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Bega Vegemite, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Bega Vegemite operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Bega Cheese: Bidding to Bring Vegemite Back Home can be done for the following purposes –
1. Strategic planning using facts provided in Bega Cheese: Bidding to Bring Vegemite Back Home case study
2. Improving business portfolio management of Bega Vegemite
3. Assessing feasibility of the new initiative in Finance & Accounting field.
4. Making a Finance & Accounting topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Bega Vegemite
Strengths Bega Cheese: Bidding to Bring Vegemite Back Home | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Bega Vegemite in Bega Cheese: Bidding to Bring Vegemite Back Home Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of Bega Vegemite in the sector have low bargaining power. Bega Cheese: Bidding to Bring Vegemite Back Home has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Bega Vegemite to manage not only supply disruptions but also source products at highly competitive prices.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Bega Vegemite digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Bega Vegemite 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.
Effective Research and Development (R&D)
– Bega Vegemite has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Bega Cheese: Bidding to Bring Vegemite Back Home - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High brand equity
– Bega Vegemite has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Bega Vegemite to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Learning organization
- Bega Vegemite is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Bega Vegemite is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Bega Cheese: Bidding to Bring Vegemite Back Home Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Highly skilled collaborators
– Bega Vegemite has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Bega Cheese: Bidding to Bring Vegemite Back Home HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Strong track record of project management
– Bega Vegemite is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Innovation driven organization
– Bega Vegemite is one of the most innovative firm in sector. Manager in Bega Cheese: Bidding to Bring Vegemite Back Home Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Cross disciplinary teams
– Horizontal connected teams at the Bega Vegemite 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.
Ability to recruit top talent
– Bega Vegemite is one of the leading recruiters in the industry. Managers in the Bega Cheese: Bidding to Bring Vegemite Back Home are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Superior customer experience
– The customer experience strategy of Bega Vegemite in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Analytics focus
– Bega Vegemite 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 Benjamin C. Esty, Lauren G. Pickle 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 Bega Cheese: Bidding to Bring Vegemite Back Home | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Bega Cheese: Bidding to Bring Vegemite Back Home are -
No frontier risks strategy
– After analyzing the HBR case study Bega Cheese: Bidding to Bring Vegemite Back Home, 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.
Lack of clear differentiation of Bega Vegemite products
– To increase the profitability and margins on the products, Bega Vegemite 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 Bega Vegemite supply chain. Even after few cautionary changes mentioned in the HBR case study - Bega Cheese: Bidding to Bring Vegemite Back Home, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Bega Vegemite vulnerable to further global disruptions in South East Asia.
Workers concerns about automation
– As automation is fast increasing in the segment, Bega Vegemite needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Bega Cheese: Bidding to Bring Vegemite Back Home, is just above the industry average. Bega Vegemite 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Benjamin C. Esty, Lauren G. Pickle suggests that, Bega Vegemite 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Bega Cheese: Bidding to Bring Vegemite Back Home HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Bega Vegemite has relatively successful track record of launching new products.
Slow decision making process
– As mentioned earlier in the report, Bega Vegemite has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Bega Vegemite even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Interest costs
– Compare to the competition, Bega Vegemite has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Bega Cheese: Bidding to Bring Vegemite Back Home, in the dynamic environment Bega Vegemite has struggled to respond to the nimble upstart competition. Bega Vegemite has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Low market penetration in new markets
– Outside its home market of Bega Vegemite, firm in the HBR case study Bega Cheese: Bidding to Bring Vegemite Back Home needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Opportunities Bega Cheese: Bidding to Bring Vegemite Back Home | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Bega Cheese: Bidding to Bring Vegemite Back Home are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Bega Vegemite can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Bega Cheese: Bidding to Bring Vegemite Back Home, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Bega Vegemite in the consumer business. Now Bega Vegemite can target international markets with far fewer capital restrictions requirements than the existing system.
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. Bega Vegemite can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Creating value in data economy
– The success of analytics program of Bega Vegemite has opened avenues for new revenue streams for the organization in the industry. This can help Bega Vegemite to build a more holistic ecosystem as suggested in the Bega Cheese: Bidding to Bring Vegemite Back Home case study. Bega Vegemite can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Bega Vegemite can use these opportunities to build new business models that can help the communities that Bega Vegemite operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Learning at scale
– Online learning technologies has now opened space for Bega Vegemite to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Building a culture of innovation
– managers at Bega Vegemite can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Finance & Accounting segment.
Buying journey improvements
– Bega Vegemite can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Bega Cheese: Bidding to Bring Vegemite Back Home suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Bega Vegemite can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Using analytics as competitive advantage
– Bega Vegemite has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Bega Cheese: Bidding to Bring Vegemite Back Home - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Bega Vegemite to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Leveraging digital technologies
– Bega Vegemite can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Loyalty marketing
– Bega Vegemite 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 Finance & Accounting industry, but it has also influenced the consumer preferences. Bega Vegemite can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats Bega Cheese: Bidding to Bring Vegemite Back Home External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Bega Cheese: Bidding to Bring Vegemite Back Home are -
Technology acceleration in Forth Industrial Revolution
– Bega Vegemite has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Bega Vegemite 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.
Increasing wage structure of Bega Vegemite
– 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 Bega Vegemite.
Stagnating economy with rate increase
– Bega Vegemite can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Bega Cheese: Bidding to Bring Vegemite Back Home, Bega Vegemite may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Finance & Accounting .
High dependence on third party suppliers
– Bega Vegemite high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Bega Vegemite in the Finance & Accounting sector and impact the bottomline of the organization.
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Bega Vegemite can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Bega Cheese: Bidding to Bring Vegemite Back Home .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Bega Vegemite with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Shortening product life cycle
– it is one of the major threat that Bega Vegemite is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Environmental challenges
– Bega Vegemite needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Bega Vegemite can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Regulatory challenges
– Bega Vegemite 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.
Consumer confidence and its impact on Bega Vegemite demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Weighted SWOT Analysis of Bega Cheese: Bidding to Bring Vegemite Back Home Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Bega Cheese: Bidding to Bring Vegemite Back Home needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Bega Cheese: Bidding to Bring Vegemite Back Home is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Bega Cheese: Bidding to Bring Vegemite Back Home is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Bega Cheese: Bidding to Bring Vegemite Back Home is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Bega Vegemite needs to make to build a sustainable competitive advantage.