Arkansas Egg Company: Cracks in the Specialty Egg Market SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Arkansas Egg Company: Cracks in the Specialty Egg Market
Michael Cox, a third generation producer of eggs based in the small town of Summers, Arkansas, converted production in 2007 from conventional caged white eggs to specialty eggs bearing the marketing attributes of organic, cage-free, free-range, and pasture-raised. Although he did this to secure contracts with better margins, in 2016 there was a glut of conventional white eggs on the market and that was depressing prices. Because of this, consumers were switching from expensive specialty eggs to the cheap white eggs. Now a key contract that Cox had with CCF Brands for the output of 150,000 hens laying certified USDA organic cage-free eggs was expiring. Faced with selling the eggs at a loss on the open market, Cox must decide what to do. In this case students can study a number of basic and advanced managerial accounting concepts, including relevant and irrelevant costs for short-term decision making, break-even analyses, sell or process further, and when to drop a product. Students will build a table for marginal revenue and marginal cost for egg production. This analysis is more advanced because the hens do not generate revenue evenly of the production cycle while the variable costs are relatively even. This case is well suited for an undergraduate or graduate course in managerial accounting covering short-term decision-making. Although receiving light treatment in the instructor's manual, the case could also be used to study longer term business strategy.
Swot Analysis of "Arkansas Egg Company: Cracks in the Specialty Egg Market" written by David G Hyatt includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Eggs Cox facing as an external strategic factors. Some of the topics covered in Arkansas Egg Company: Cracks in the Specialty Egg Market case study are - Strategic Management Strategies, Costs, Strategy and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Arkansas Egg Company: Cracks in the Specialty Egg Market casestudy better are - – increasing commodity prices, digital marketing is dominated by two big players Facebook and Google, talent flight as more people leaving formal jobs, supply chains are disrupted by pandemic , customer relationship management is fast transforming because of increasing concerns over data privacy, increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies,
increasing government debt because of Covid-19 spendings, wage bills are increasing, etc
Introduction to SWOT Analysis of Arkansas Egg Company: Cracks in the Specialty Egg Market
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Arkansas Egg Company: Cracks in the Specialty Egg Market case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Eggs Cox, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Eggs Cox 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 Arkansas Egg Company: Cracks in the Specialty Egg Market can be done for the following purposes –
1. Strategic planning using facts provided in Arkansas Egg Company: Cracks in the Specialty Egg Market case study
2. Improving business portfolio management of Eggs Cox
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 Eggs Cox
Strengths Arkansas Egg Company: Cracks in the Specialty Egg Market | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Eggs Cox in Arkansas Egg Company: Cracks in the Specialty Egg Market Harvard Business Review case study are -
Training and development
– Eggs Cox has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Arkansas Egg Company: Cracks in the Specialty Egg Market 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.
Analytics focus
– Eggs Cox 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 David G Hyatt 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.
Organizational Resilience of Eggs Cox
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Eggs Cox does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Superior customer experience
– The customer experience strategy of Eggs Cox in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Diverse revenue streams
– Eggs Cox is present in almost all the verticals within the industry. This has provided firm in Arkansas Egg Company: Cracks in the Specialty Egg Market 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.
Cross disciplinary teams
– Horizontal connected teams at the Eggs Cox 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.
Operational resilience
– The operational resilience strategy in the Arkansas Egg Company: Cracks in the Specialty Egg Market Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
High brand equity
– Eggs Cox has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Eggs Cox to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Successful track record of launching new products
– Eggs Cox has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Eggs Cox 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.
Learning organization
- Eggs Cox 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 Eggs Cox is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Arkansas Egg Company: Cracks in the Specialty Egg Market Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– Eggs Cox is one of the leading recruiters in the industry. Managers in the Arkansas Egg Company: Cracks in the Specialty Egg Market are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Strong track record of project management
– Eggs Cox 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 Arkansas Egg Company: Cracks in the Specialty Egg Market | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Arkansas Egg Company: Cracks in the Specialty Egg Market are -
Aligning sales with marketing
– It come across in the case study Arkansas Egg Company: Cracks in the Specialty Egg Market that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Arkansas Egg Company: Cracks in the Specialty Egg Market can leverage the sales team experience to cultivate customer relationships as Eggs Cox is planning to shift buying processes online.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Arkansas Egg Company: Cracks in the Specialty Egg Market, it seems that the employees of Eggs Cox 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 bargaining power of channel partners
– Because of the regulatory requirements, David G Hyatt suggests that, Eggs Cox 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.
Products dominated business model
– Even though Eggs Cox 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 - Arkansas Egg Company: Cracks in the Specialty Egg Market should strive to include more intangible value offerings along with its core products and services.
Low market penetration in new markets
– Outside its home market of Eggs Cox, firm in the HBR case study Arkansas Egg Company: Cracks in the Specialty Egg Market needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Lack of clear differentiation of Eggs Cox products
– To increase the profitability and margins on the products, Eggs Cox 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 Eggs Cox supply chain. Even after few cautionary changes mentioned in the HBR case study - Arkansas Egg Company: Cracks in the Specialty Egg Market, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Eggs Cox 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 Arkansas Egg Company: Cracks in the Specialty Egg Market, in the dynamic environment Eggs Cox has struggled to respond to the nimble upstart competition. Eggs Cox has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High operating costs
– Compare to the competitors, firm in the HBR case study Arkansas Egg Company: Cracks in the Specialty Egg Market 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 Eggs Cox 's lucrative customers.
Skills based hiring
– The stress on hiring functional specialists at Eggs Cox 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Eggs Cox is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Arkansas Egg Company: Cracks in the Specialty Egg Market can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities Arkansas Egg Company: Cracks in the Specialty Egg Market | 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 Arkansas Egg Company: Cracks in the Specialty Egg Market are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Eggs Cox can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Eggs Cox 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, Arkansas Egg Company: Cracks in the Specialty Egg Market, 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 Eggs Cox 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.
Using analytics as competitive advantage
– Eggs Cox 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 Arkansas Egg Company: Cracks in the Specialty Egg Market - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Eggs Cox to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Low interest rates
– Even though inflation is raising its head in most developed economies, Eggs Cox 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.
Building a culture of innovation
– managers at Eggs Cox 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.
Manufacturing automation
– Eggs Cox can use the latest technology developments to improve its manufacturing and designing process in Finance & Accounting segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Creating value in data economy
– The success of analytics program of Eggs Cox has opened avenues for new revenue streams for the organization in the industry. This can help Eggs Cox to build a more holistic ecosystem as suggested in the Arkansas Egg Company: Cracks in the Specialty Egg Market case study. Eggs Cox can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Loyalty marketing
– Eggs Cox 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.
Developing new processes and practices
– Eggs Cox can develop new processes and procedures in Finance & Accounting industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Better consumer reach
– The expansion of the 5G network will help Eggs Cox to increase its market reach. Eggs Cox 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Eggs Cox 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 Eggs Cox to hire the very best people irrespective of their geographical location.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Eggs Cox is facing challenges because of the dominance of functional experts in the organization. Arkansas Egg Company: Cracks in the Specialty Egg Market 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.
Threats Arkansas Egg Company: Cracks in the Specialty Egg Market External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Arkansas Egg Company: Cracks in the Specialty Egg Market are -
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 Eggs Cox business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Eggs Cox 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.
Environmental challenges
– Eggs Cox 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. Eggs Cox can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Eggs Cox in the Finance & Accounting industry. The Finance & Accounting industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
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 Eggs Cox in the Finance & Accounting sector and impact the bottomline of the organization.
Increasing wage structure of Eggs Cox
– 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 Eggs Cox.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Eggs Cox with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Technology acceleration in Forth Industrial Revolution
– Eggs Cox has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Eggs Cox 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.
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Eggs Cox 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 Arkansas Egg Company: Cracks in the Specialty Egg Market .
Regulatory challenges
– Eggs Cox 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.
Shortening product life cycle
– it is one of the major threat that Eggs Cox is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Eggs Cox.
Weighted SWOT Analysis of Arkansas Egg Company: Cracks in the Specialty Egg Market 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 Arkansas Egg Company: Cracks in the Specialty Egg Market 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 Arkansas Egg Company: Cracks in the Specialty Egg Market 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 Arkansas Egg Company: Cracks in the Specialty Egg Market 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 Arkansas Egg Company: Cracks in the Specialty Egg Market 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 Eggs Cox needs to make to build a sustainable competitive advantage.
