Case Study Description of Chaudhary Group: Rebuilding Nepal (B)
This B case is a supplement to the Chaudhary Group: Rebuilding Nepal case. Having successfully spearheaded relief work in the aftermath of the Nepal earthquake the Chaudhary Foundation envisions creating a more comprehensive and sustainable development model. They are keen to build a model village that integrates components of shelter, education, skill development and livelihood creation and affords residents a basic standard of living. What should the blueprint of this sustainable ecosystem include? Who are the stakeholders they should collaborate with on this effort? Can this model be replicated at scale across the country?
Authors :: Christopher J. Malloy, Lauren H. Cohen, Inakshi Sobti
Topics :: Innovation & Entrepreneurship
Tags :: Competitive strategy, Crisis management, Decision making, Economy, Emerging markets, Government, Innovation, Leadership, Leading teams, Networking, Organizational culture, Public relations, Social enterprise, Social responsibility, Venture capital, SWOT Analysis, SWOT Matrix, TOWS, Weighted SWOT Analysis
Swot Analysis of "Chaudhary Group: Rebuilding Nepal (B)" written by Christopher J. Malloy, Lauren H. Cohen, Inakshi Sobti includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Chaudhary Nepal facing as an external strategic factors. Some of the topics covered in Chaudhary Group: Rebuilding Nepal (B) case study are - Strategic Management Strategies, Competitive strategy, Crisis management, Decision making, Economy, Emerging markets, Government, Innovation, Leadership, Leading teams, Networking, Organizational culture, Public relations, Social enterprise, Social responsibility, Venture capital and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Chaudhary Group: Rebuilding Nepal (B) casestudy better are - – competitive advantages are harder to sustain because of technology dispersion, increasing commodity prices, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing inequality as vast percentage of new income is going to the top 1%, wage bills are increasing, increasing transportation and logistics costs, there is increasing trade war between United States & China,
increasing household debt because of falling income levels, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of Chaudhary Group: Rebuilding Nepal (B)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Chaudhary Group: Rebuilding Nepal (B) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Chaudhary Nepal, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Chaudhary Nepal 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 Chaudhary Group: Rebuilding Nepal (B) can be done for the following purposes –
1. Strategic planning using facts provided in Chaudhary Group: Rebuilding Nepal (B) case study
2. Improving business portfolio management of Chaudhary Nepal
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 Chaudhary Nepal
Strengths Chaudhary Group: Rebuilding Nepal (B) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Chaudhary Nepal in Chaudhary Group: Rebuilding Nepal (B) Harvard Business Review case study are -
High switching costs
– The high switching costs that Chaudhary Nepal 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.
Superior customer experience
– The customer experience strategy of Chaudhary Nepal in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to lead change in Innovation & Entrepreneurship field
– Chaudhary Nepal 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 Chaudhary Nepal in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Highly skilled collaborators
– Chaudhary Nepal 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 Chaudhary Group: Rebuilding Nepal (B) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High brand equity
– Chaudhary Nepal has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Chaudhary Nepal to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Digital Transformation in Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Chaudhary Nepal digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Chaudhary Nepal 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)
– Chaudhary Nepal 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 Chaudhary Group: Rebuilding Nepal (B) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Operational resilience
– The operational resilience strategy in the Chaudhary Group: Rebuilding Nepal (B) 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.
Analytics focus
– Chaudhary Nepal 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 Christopher J. Malloy, Lauren H. Cohen, Inakshi Sobti 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.
Low bargaining power of suppliers
– Suppliers of Chaudhary Nepal in the sector have low bargaining power. Chaudhary Group: Rebuilding Nepal (B) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Chaudhary Nepal to manage not only supply disruptions but also source products at highly competitive prices.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– Chaudhary Group: Rebuilding Nepal (B) firm has clearly differentiated products in the market place. This has enabled Chaudhary Nepal to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Chaudhary Nepal to invest into research and development (R&D) and innovation.
Organizational Resilience of Chaudhary Nepal
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Chaudhary Nepal does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses Chaudhary Group: Rebuilding Nepal (B) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Chaudhary Group: Rebuilding Nepal (B) are -
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Chaudhary Group: Rebuilding Nepal (B), is just above the industry average. Chaudhary Nepal 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Chaudhary Group: Rebuilding Nepal (B), it seems that the employees of Chaudhary Nepal 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.
Slow decision making process
– As mentioned earlier in the report, Chaudhary Nepal 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. Chaudhary Nepal 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.
Products dominated business model
– Even though Chaudhary Nepal 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 - Chaudhary Group: Rebuilding Nepal (B) should strive to include more intangible value offerings along with its core products and services.
Interest costs
– Compare to the competition, Chaudhary Nepal 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.
Lack of clear differentiation of Chaudhary Nepal products
– To increase the profitability and margins on the products, Chaudhary Nepal needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Chaudhary Nepal 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.
Low market penetration in new markets
– Outside its home market of Chaudhary Nepal, firm in the HBR case study Chaudhary Group: Rebuilding Nepal (B) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to strategic competitive environment developments
– As Chaudhary Group: Rebuilding Nepal (B) HBR case study mentions - Chaudhary Nepal 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Chaudhary Group: Rebuilding Nepal (B), in the dynamic environment Chaudhary Nepal has struggled to respond to the nimble upstart competition. Chaudhary Nepal 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 Chaudhary Group: Rebuilding Nepal (B) 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 Chaudhary Nepal 's lucrative customers.
Opportunities Chaudhary Group: Rebuilding Nepal (B) | 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 Chaudhary Group: Rebuilding Nepal (B) are -
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. Chaudhary Nepal 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. Chaudhary Nepal 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.
Building a culture of innovation
– managers at Chaudhary Nepal can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Innovation & Entrepreneurship segment.
Better consumer reach
– The expansion of the 5G network will help Chaudhary Nepal to increase its market reach. Chaudhary Nepal 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.
Buying journey improvements
– Chaudhary Nepal can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Chaudhary Group: Rebuilding Nepal (B) 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
– Chaudhary Nepal 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.
Creating value in data economy
– The success of analytics program of Chaudhary Nepal has opened avenues for new revenue streams for the organization in the industry. This can help Chaudhary Nepal to build a more holistic ecosystem as suggested in the Chaudhary Group: Rebuilding Nepal (B) case study. Chaudhary Nepal can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– Chaudhary Nepal 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 Chaudhary Group: Rebuilding Nepal (B) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Chaudhary Nepal 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, Chaudhary Nepal 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Chaudhary Nepal 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 Chaudhary Nepal to hire the very best people irrespective of their geographical location.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Innovation & Entrepreneurship industry, but it has also influenced the consumer preferences. Chaudhary Nepal can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Loyalty marketing
– Chaudhary Nepal 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.
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 Chaudhary Nepal 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, Chaudhary Nepal 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, Chaudhary Group: Rebuilding Nepal (B), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Threats Chaudhary Group: Rebuilding Nepal (B) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Chaudhary Group: Rebuilding Nepal (B) are -
Stagnating economy with rate increase
– Chaudhary Nepal 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.
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Chaudhary Nepal 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.
Consumer confidence and its impact on Chaudhary Nepal 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Chaudhary Nepal with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Chaudhary Nepal business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Chaudhary Nepal 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.
Shortening product life cycle
– it is one of the major threat that Chaudhary Nepal is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Chaudhary Nepal needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.
Environmental challenges
– Chaudhary Nepal 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. Chaudhary Nepal can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
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.
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. Chaudhary Nepal will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Chaudhary Nepal in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Chaudhary Group: Rebuilding Nepal (B) 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 Chaudhary Group: Rebuilding Nepal (B) 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 Chaudhary Group: Rebuilding Nepal (B) 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 Chaudhary Group: Rebuilding Nepal (B) 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 Chaudhary Group: Rebuilding Nepal (B) 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 Chaudhary Nepal needs to make to build a sustainable competitive advantage.
