Case Study Description of Hunley, Inc.: Casting for Growth
Hunley, Inc. manufactures rods for the niche sport of fly fishing. It specializes in freshwater rods that are perceived as "middle-market" products, targeted at "avid" fly fishers, In the face of declining revenue and a decreasing price per unit sold, the company's president is considering several growth options, including introducing a rod made from state-of-the-art materials (moving up-market) and expanding distribution into Walmart (down-market). Hunley's president must decide whether either option is feasible and if so, what kind of marketing plan is necessary for each to succeed. If neither option is chosen, he must determine what other ways Hunley might grow. This is a rich marketing mix case that requires students to develop a qualitative and quantitative plan for Hunley's product line under two very different growth options. The discussion can illuminate numerous marketing issues that an instructor might want to emphasize, including: brand extension, product and company market position, positioning statements, market segmentation, introductory marketing programs, new product launches, channel conflict, sales force management of a strategic shift, among others. This case is suitable for an introductory marketing course for undergraduate or MBA students. It can also be used in a section on positioning and increasing consumers' willingness-to-pay within a strategy course. Further, the challenges facing Hunley are relevant to many courses in executive education.
Swot Analysis of "Hunley, Inc.: Casting for Growth" written by John A. Quelch, James T. Kindley includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Hunley Hunley's facing as an external strategic factors. Some of the topics covered in Hunley, Inc.: Casting for Growth case study are - Strategic Management Strategies, and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Hunley, Inc.: Casting for Growth casestudy better are - – increasing commodity prices, increasing energy prices, there is backlash against globalization, challanges to central banks by blockchain based private currencies, increasing household debt because of falling income levels, competitive advantages are harder to sustain because of technology dispersion, digital marketing is dominated by two big players Facebook and Google,
there is increasing trade war between United States & China, talent flight as more people leaving formal jobs, etc
Introduction to SWOT Analysis of Hunley, Inc.: Casting for Growth
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Hunley, Inc.: Casting for Growth case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Hunley Hunley's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Hunley Hunley's 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 Hunley, Inc.: Casting for Growth can be done for the following purposes –
1. Strategic planning using facts provided in Hunley, Inc.: Casting for Growth case study
2. Improving business portfolio management of Hunley Hunley's
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Hunley Hunley's
Strengths Hunley, Inc.: Casting for Growth | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Hunley Hunley's in Hunley, Inc.: Casting for Growth Harvard Business Review case study are -
Ability to recruit top talent
– Hunley Hunley's is one of the leading recruiters in the industry. Managers in the Hunley, Inc.: Casting for Growth are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
High switching costs
– The high switching costs that Hunley Hunley's 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.
Low bargaining power of suppliers
– Suppliers of Hunley Hunley's in the sector have low bargaining power. Hunley, Inc.: Casting for Growth has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Hunley Hunley's to manage not only supply disruptions but also source products at highly competitive prices.
Diverse revenue streams
– Hunley Hunley's is present in almost all the verticals within the industry. This has provided firm in Hunley, Inc.: Casting for Growth 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.
Successful track record of launching new products
– Hunley Hunley's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Hunley Hunley's has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Highly skilled collaborators
– Hunley Hunley's 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 Hunley, Inc.: Casting for Growth HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Superior customer experience
– The customer experience strategy of Hunley Hunley's in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Organizational Resilience of Hunley Hunley's
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Hunley Hunley's does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Strong track record of project management
– Hunley Hunley's is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Hunley Hunley's digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Hunley Hunley's 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
– Hunley Hunley's has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Hunley Hunley's to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in Sales & Marketing industry
– Hunley, Inc.: Casting for Growth firm has clearly differentiated products in the market place. This has enabled Hunley Hunley's to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Hunley Hunley's to invest into research and development (R&D) and innovation.
Weaknesses Hunley, Inc.: Casting for Growth | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Hunley, Inc.: Casting for Growth are -
Slow to strategic competitive environment developments
– As Hunley, Inc.: Casting for Growth HBR case study mentions - Hunley Hunley's 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.
Interest costs
– Compare to the competition, Hunley Hunley's has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
High operating costs
– Compare to the competitors, firm in the HBR case study Hunley, Inc.: Casting for Growth 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 Hunley Hunley's 's lucrative customers.
Products dominated business model
– Even though Hunley Hunley's has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Hunley, Inc.: Casting for Growth should strive to include more intangible value offerings along with its core products and services.
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 Hunley Hunley's supply chain. Even after few cautionary changes mentioned in the HBR case study - Hunley, Inc.: Casting for Growth, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Hunley Hunley's vulnerable to further global disruptions in South East Asia.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Hunley Hunley's is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Hunley, Inc.: Casting for Growth can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Hunley Hunley's 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.
Skills based hiring
– The stress on hiring functional specialists at Hunley Hunley's 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.
Capital Spending Reduction
– Even during the low interest decade, Hunley Hunley's 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 cash cycle compare to competitors
Hunley Hunley's 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Hunley, Inc.: Casting for Growth, in the dynamic environment Hunley Hunley's has struggled to respond to the nimble upstart competition. Hunley Hunley's has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Opportunities Hunley, Inc.: Casting for Growth | 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 Hunley, Inc.: Casting for Growth are -
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 Hunley Hunley's in the consumer business. Now Hunley Hunley's can target international markets with far fewer capital restrictions requirements than the existing system.
Buying journey improvements
– Hunley Hunley's can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Hunley, Inc.: Casting for Growth 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.
Leveraging digital technologies
– Hunley Hunley's 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.
Building a culture of innovation
– managers at Hunley Hunley's 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 Sales & Marketing segment.
Loyalty marketing
– Hunley Hunley's 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Hunley Hunley's 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, Hunley, Inc.: Casting for Growth, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Hunley Hunley's can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Manufacturing automation
– Hunley Hunley's can use the latest technology developments to improve its manufacturing and designing process in Sales & Marketing 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Sales & Marketing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Hunley Hunley's 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. Hunley Hunley's 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Hunley Hunley's can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Hunley Hunley's in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Sales & Marketing segment, and it will provide faster access to the consumers.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Hunley Hunley's is facing challenges because of the dominance of functional experts in the organization. Hunley, Inc.: Casting for Growth case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Hunley Hunley's 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 Hunley Hunley's to hire the very best people irrespective of their geographical location.
Threats Hunley, Inc.: Casting for Growth External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Hunley, Inc.: Casting for Growth are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Hunley Hunley's 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 Hunley, Inc.: Casting for Growth .
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. Hunley Hunley's 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Hunley Hunley's with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Consumer confidence and its impact on Hunley Hunley's 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.
High dependence on third party suppliers
– Hunley Hunley's 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.
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 Hunley Hunley's.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Hunley Hunley's in the Sales & Marketing industry. The Sales & Marketing 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 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.
Easy access to finance
– Easy access to finance in Sales & Marketing field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Hunley Hunley's can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Environmental challenges
– Hunley Hunley's 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. Hunley Hunley's can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Stagnating economy with rate increase
– Hunley Hunley's 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.
Regulatory challenges
– Hunley Hunley's 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 Sales & Marketing industry regulations.
Increasing wage structure of Hunley Hunley's
– 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 Hunley Hunley's.
Weighted SWOT Analysis of Hunley, Inc.: Casting for Growth 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 Hunley, Inc.: Casting for Growth 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 Hunley, Inc.: Casting for Growth 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 Hunley, Inc.: Casting for Growth 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 Hunley, Inc.: Casting for Growth 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 Hunley Hunley's needs to make to build a sustainable competitive advantage.