Aravind Eye Care System: Providing Total Eye Care to the Rural Population SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Communication
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Aravind Eye Care System: Providing Total Eye Care to the Rural Population
The case deals with poor acceptance of the eye care service by the rural population in the south Indian state of Tamil Nadu. One of the factors causing poor acceptance is the lack of awareness among rural population that many cases of blindness are curable. Fear of surgery and cost are the other major barriers to acceptance by these consumers. Aravind is the largest eye care provider in the world and has pioneered many process innovations that have reduced the cost of eye treatment substantially. The company has a culture that encourages responsive service by a trained and motivated staff. It has experimented with a number of options to educate and provide eye care service to the rural consumers. The manager is to examine options in the decision areas of promotion and service delivery to enhance the acceptance of eye care service by the rural consumers.
Authors :: Sanal Kumar Velayudhan, R. Meenakshi Sundaram, R. D. Thulasiraj
Swot Analysis of "Aravind Eye Care System: Providing Total Eye Care to the Rural Population" written by Sanal Kumar Velayudhan, R. Meenakshi Sundaram, R. D. Thulasiraj includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Eye Rural facing as an external strategic factors. Some of the topics covered in Aravind Eye Care System: Providing Total Eye Care to the Rural Population case study are - Strategic Management Strategies, Emerging markets, Marketing and Communication.
Some of the macro environment factors that can be used to understand the Aravind Eye Care System: Providing Total Eye Care to the Rural Population casestudy better are - – digital marketing is dominated by two big players Facebook and Google, there is backlash against globalization, technology disruption, geopolitical disruptions, there is increasing trade war between United States & China, increasing inequality as vast percentage of new income is going to the top 1%, increasing household debt because of falling income levels,
wage bills are increasing, talent flight as more people leaving formal jobs, etc
Introduction to SWOT Analysis of Aravind Eye Care System: Providing Total Eye Care to the Rural Population
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Aravind Eye Care System: Providing Total Eye Care to the Rural Population case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Eye Rural, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Eye Rural 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 Aravind Eye Care System: Providing Total Eye Care to the Rural Population can be done for the following purposes –
1. Strategic planning using facts provided in Aravind Eye Care System: Providing Total Eye Care to the Rural Population case study
2. Improving business portfolio management of Eye Rural
3. Assessing feasibility of the new initiative in Communication field.
4. Making a Communication topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Eye Rural
Strengths Aravind Eye Care System: Providing Total Eye Care to the Rural Population | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Eye Rural in Aravind Eye Care System: Providing Total Eye Care to the Rural Population Harvard Business Review case study are -
Sustainable margins compare to other players in Communication industry
– Aravind Eye Care System: Providing Total Eye Care to the Rural Population firm has clearly differentiated products in the market place. This has enabled Eye Rural to fetch slight price premium compare to the competitors in the Communication industry. The sustainable margins have also helped Eye Rural to invest into research and development (R&D) and innovation.
Analytics focus
– Eye Rural 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 Sanal Kumar Velayudhan, R. Meenakshi Sundaram, R. D. Thulasiraj 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.
Ability to recruit top talent
– Eye Rural is one of the leading recruiters in the industry. Managers in the Aravind Eye Care System: Providing Total Eye Care to the Rural Population 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
– Eye Rural is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Training and development
– Eye Rural has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Aravind Eye Care System: Providing Total Eye Care to the Rural Population 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.
Low bargaining power of suppliers
– Suppliers of Eye Rural in the sector have low bargaining power. Aravind Eye Care System: Providing Total Eye Care to the Rural Population has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Eye Rural to manage not only supply disruptions but also source products at highly competitive prices.
Learning organization
- Eye Rural 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 Eye Rural is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Aravind Eye Care System: Providing Total Eye Care to the Rural Population Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Eye Rural is present in almost all the verticals within the industry. This has provided firm in Aravind Eye Care System: Providing Total Eye Care to the Rural Population 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
– Eye Rural has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Eye Rural 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.
High brand equity
– Eye Rural has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Eye Rural to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Highly skilled collaborators
– Eye Rural 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 Aravind Eye Care System: Providing Total Eye Care to the Rural Population HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Eye Rural is one of the most innovative firm in sector. Manager in Aravind Eye Care System: Providing Total Eye Care to the Rural Population Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Weaknesses Aravind Eye Care System: Providing Total Eye Care to the Rural Population | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Aravind Eye Care System: Providing Total Eye Care to the Rural Population are -
High cash cycle compare to competitors
Eye Rural 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.
Need for greater diversity
– Eye Rural has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Aligning sales with marketing
– It come across in the case study Aravind Eye Care System: Providing Total Eye Care to the Rural Population 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 Aravind Eye Care System: Providing Total Eye Care to the Rural Population can leverage the sales team experience to cultivate customer relationships as Eye Rural is planning to shift buying processes online.
Low market penetration in new markets
– Outside its home market of Eye Rural, firm in the HBR case study Aravind Eye Care System: Providing Total Eye Care to the Rural Population needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
No frontier risks strategy
– After analyzing the HBR case study Aravind Eye Care System: Providing Total Eye Care to the Rural Population, it seems that company is thinking about the frontier risks that can impact Communication 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Eye Rural 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Aravind Eye Care System: Providing Total Eye Care to the Rural Population, it seems that the employees of Eye Rural 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Aravind Eye Care System: Providing Total Eye Care to the Rural Population, is just above the industry average. Eye Rural 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Aravind Eye Care System: Providing Total Eye Care to the Rural Population, in the dynamic environment Eye Rural has struggled to respond to the nimble upstart competition. Eye Rural has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Interest costs
– Compare to the competition, Eye Rural 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 Aravind Eye Care System: Providing Total Eye Care to the Rural Population 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 Eye Rural 's lucrative customers.
Opportunities Aravind Eye Care System: Providing Total Eye Care to the Rural Population | 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 Aravind Eye Care System: Providing Total Eye Care to the Rural Population are -
Learning at scale
– Online learning technologies has now opened space for Eye Rural 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.
Loyalty marketing
– Eye Rural 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 Eye Rural 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Eye Rural can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Eye Rural 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 Eye Rural to hire the very best people irrespective of their geographical location.
Buying journey improvements
– Eye Rural can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Aravind Eye Care System: Providing Total Eye Care to the Rural Population 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.
Building a culture of innovation
– managers at Eye Rural 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 Communication segment.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Eye Rural is facing challenges because of the dominance of functional experts in the organization. Aravind Eye Care System: Providing Total Eye Care to the Rural Population 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.
Developing new processes and practices
– Eye Rural can develop new processes and procedures in Communication 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.
Using analytics as competitive advantage
– Eye Rural 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 Aravind Eye Care System: Providing Total Eye Care to the Rural Population - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Eye Rural to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Eye Rural 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, Aravind Eye Care System: Providing Total Eye Care to the Rural Population, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Better consumer reach
– The expansion of the 5G network will help Eye Rural to increase its market reach. Eye Rural 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Eye Rural in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Communication segment, and it will provide faster access to the consumers.
Threats Aravind Eye Care System: Providing Total Eye Care to the Rural Population External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Aravind Eye Care System: Providing Total Eye Care to the Rural Population 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 Eye Rural business can come under increasing regulations regarding data privacy, data security, etc.
Regulatory challenges
– Eye Rural 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 Communication industry regulations.
Easy access to finance
– Easy access to finance in Communication field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Eye Rural can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Eye Rural.
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.
Shortening product life cycle
– it is one of the major threat that Eye Rural is facing in Communication sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Eye Rural with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Stagnating economy with rate increase
– Eye Rural 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.
Consumer confidence and its impact on Eye Rural 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.
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 Eye Rural in the Communication sector and impact the bottomline of the organization.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Eye Rural in the Communication industry. The Communication 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.
Increasing wage structure of Eye Rural
– 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 Eye Rural.
High dependence on third party suppliers
– Eye Rural 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.
Weighted SWOT Analysis of Aravind Eye Care System: Providing Total Eye Care to the Rural Population 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 Aravind Eye Care System: Providing Total Eye Care to the Rural Population 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 Aravind Eye Care System: Providing Total Eye Care to the Rural Population 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 Aravind Eye Care System: Providing Total Eye Care to the Rural Population 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 Aravind Eye Care System: Providing Total Eye Care to the Rural Population 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 Eye Rural needs to make to build a sustainable competitive advantage.
