Modern Agricultural Farm: Budgeting for Control SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Modern Agricultural Farm: Budgeting for Control
In May 2011, the managing partner of the Modern Agricultural Farm in rural Pakistan was reviewing the set of performance reports for the previous month sent by the farm accountant. These reports had been designed by a management analysis and research consultant to convert the farm system to that used by the head office of the Alamgir Group of businesses, of which the farm was a part. There were two concerns: how to handle the fluctuations in the farm's monthly cash flow and how to plan the right combination of plantings and crops to ensure a profit. A computer-based accounting software program had been purchased to help expedite accounting and reporting, and an annual master budget plan had been established to control operations. Given the special risks faced in agriculture where the portfolio of crops was dependent on uncontrollable factors, such as the weather, the managing director wondered how he could develop a workable budget for the coming year.Student spreadsheet 7B13B025 with data is available.
Swot Analysis of "Modern Agricultural Farm: Budgeting for Control" written by Muntazar B. Ahmed includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Farm Crops facing as an external strategic factors. Some of the topics covered in Modern Agricultural Farm: Budgeting for Control case study are - Strategic Management Strategies, Operations management and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Modern Agricultural Farm: Budgeting for Control casestudy better are - – there is increasing trade war between United States & China, increasing commodity prices, wage bills are increasing, digital marketing is dominated by two big players Facebook and Google, central banks are concerned over increasing inflation, talent flight as more people leaving formal jobs, there is backlash against globalization,
increasing energy prices, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Modern Agricultural Farm: Budgeting for Control
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Modern Agricultural Farm: Budgeting for Control case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Farm Crops, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Farm Crops 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 Modern Agricultural Farm: Budgeting for Control can be done for the following purposes –
1. Strategic planning using facts provided in Modern Agricultural Farm: Budgeting for Control case study
2. Improving business portfolio management of Farm Crops
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 Farm Crops
Strengths Modern Agricultural Farm: Budgeting for Control | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Farm Crops in Modern Agricultural Farm: Budgeting for Control Harvard Business Review case study are -
Training and development
– Farm Crops has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Modern Agricultural Farm: Budgeting for Control 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.
High switching costs
– The high switching costs that Farm Crops 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.
High brand equity
– Farm Crops has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Farm Crops to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– Farm Crops is one of the most innovative firm in sector. Manager in Modern Agricultural Farm: Budgeting for Control Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Diverse revenue streams
– Farm Crops is present in almost all the verticals within the industry. This has provided firm in Modern Agricultural Farm: Budgeting for Control 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.
Ability to lead change in Finance & Accounting field
– Farm Crops 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 Farm Crops in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Low bargaining power of suppliers
– Suppliers of Farm Crops in the sector have low bargaining power. Modern Agricultural Farm: Budgeting for Control has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Farm Crops to manage not only supply disruptions but also source products at highly competitive prices.
Highly skilled collaborators
– Farm Crops 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 Modern Agricultural Farm: Budgeting for Control HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Farm Crops digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Farm Crops 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.
Superior customer experience
– The customer experience strategy of Farm Crops in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Learning organization
- Farm Crops 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 Farm Crops is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Modern Agricultural Farm: Budgeting for Control Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Strong track record of project management
– Farm Crops 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 Modern Agricultural Farm: Budgeting for Control | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Modern Agricultural Farm: Budgeting for Control are -
Skills based hiring
– The stress on hiring functional specialists at Farm Crops 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Modern Agricultural Farm: Budgeting for Control, in the dynamic environment Farm Crops has struggled to respond to the nimble upstart competition. Farm Crops has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Modern Agricultural Farm: Budgeting for Control, it seems that the employees of Farm Crops 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.
Low market penetration in new markets
– Outside its home market of Farm Crops, firm in the HBR case study Modern Agricultural Farm: Budgeting for Control needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Lack of clear differentiation of Farm Crops products
– To increase the profitability and margins on the products, Farm Crops needs to provide more differentiated products than what it is currently offering in the marketplace.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Modern Agricultural Farm: Budgeting for Control, is just above the industry average. Farm Crops needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
High operating costs
– Compare to the competitors, firm in the HBR case study Modern Agricultural Farm: Budgeting for Control 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 Farm Crops 's lucrative customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Farm Crops 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.
Capital Spending Reduction
– Even during the low interest decade, Farm Crops 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Farm Crops is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Modern Agricultural Farm: Budgeting for Control can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Need for greater diversity
– Farm Crops 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.
Opportunities Modern Agricultural Farm: Budgeting for Control | 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 Modern Agricultural Farm: Budgeting for Control are -
Buying journey improvements
– Farm Crops can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Modern Agricultural Farm: Budgeting for Control 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.
Using analytics as competitive advantage
– Farm Crops 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 Modern Agricultural Farm: Budgeting for Control - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Farm Crops to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Farm Crops is facing challenges because of the dominance of functional experts in the organization. Modern Agricultural Farm: Budgeting for Control 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Farm Crops can use these opportunities to build new business models that can help the communities that Farm Crops operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Manufacturing automation
– Farm Crops 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Finance & Accounting industry, but it has also influenced the consumer preferences. Farm Crops can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Farm Crops 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, Modern Agricultural Farm: Budgeting for Control, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Leveraging digital technologies
– Farm Crops 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 Farm Crops 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.
Learning at scale
– Online learning technologies has now opened space for Farm Crops 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.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Farm Crops can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Better consumer reach
– The expansion of the 5G network will help Farm Crops to increase its market reach. Farm Crops 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Farm Crops 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.
Threats Modern Agricultural Farm: Budgeting for Control External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Modern Agricultural Farm: Budgeting for Control are -
Environmental challenges
– Farm Crops 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. Farm Crops can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Stagnating economy with rate increase
– Farm Crops 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Farm Crops 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.
Technology acceleration in Forth Industrial Revolution
– Farm Crops has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Farm Crops 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.
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 Farm Crops in the Finance & Accounting sector and impact the bottomline of the organization.
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 Farm Crops.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Modern Agricultural Farm: Budgeting for Control, Farm Crops may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Finance & Accounting .
High dependence on third party suppliers
– Farm Crops 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.
Regulatory challenges
– Farm Crops 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.
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 Farm Crops business can come under increasing regulations regarding data privacy, data security, etc.
Shortening product life cycle
– it is one of the major threat that Farm Crops is facing in Finance & Accounting 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 Farm Crops with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Weighted SWOT Analysis of Modern Agricultural Farm: Budgeting for Control 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 Modern Agricultural Farm: Budgeting for Control 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 Modern Agricultural Farm: Budgeting for Control 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 Modern Agricultural Farm: Budgeting for Control 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 Modern Agricultural Farm: Budgeting for Control 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 Farm Crops needs to make to build a sustainable competitive advantage.
