The Big Dry and Australia's Water Markets SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of The Big Dry and Australia's Water Markets
This case is used in Darden's first-year course "Global Economies and Markets" and taught at the University of Virginia's School of Architecture, though it is also appropriate for courses in environmental sustainability. A technical note titled "Water Markets from an Economic Point of View" (UV6903) was developed to accompany this case or other cases addressing the topic of global water supply. In 2010, Australian funds were looking for foreign investors in the country's water market. Funds advertised water as "blue gold." Australian Causeway Asset Management, for example, expected high future returns because of the "chronic supply/demand imbalance for Australian water, which will result in higher water prices. Owning Australian Water Entitlements provides investors with direct exposure to water prices." There was quite a story to be told about water on this continent of notably variable weather, especially since the "Big Dry," also known as the Millennium Drought. More than anything, the drought had supported water markets as a central tool in Australian water management. As the drought receded, the floods of 2009, 2010, and 2011 took its place, so water prices were low and potentially attractive for buyers abroad.
Swot Analysis of "The Big Dry and Australia's Water Markets" written by Peter Debaere includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Water Australian facing as an external strategic factors. Some of the topics covered in The Big Dry and Australia's Water Markets case study are - Strategic Management Strategies, and Global Business.
Some of the macro environment factors that can be used to understand the The Big Dry and Australia's Water Markets casestudy better are - – supply chains are disrupted by pandemic , increasing transportation and logistics costs, central banks are concerned over increasing inflation, customer relationship management is fast transforming because of increasing concerns over data privacy, there is increasing trade war between United States & China, geopolitical disruptions, talent flight as more people leaving formal jobs,
increasing household debt because of falling income levels, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of The Big Dry and Australia's Water Markets
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The Big Dry and Australia's Water Markets case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Water Australian, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Water Australian 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 The Big Dry and Australia's Water Markets can be done for the following purposes –
1. Strategic planning using facts provided in The Big Dry and Australia's Water Markets case study
2. Improving business portfolio management of Water Australian
3. Assessing feasibility of the new initiative in Global Business field.
4. Making a Global Business topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Water Australian
Strengths The Big Dry and Australia's Water Markets | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Water Australian in The Big Dry and Australia's Water Markets Harvard Business Review case study are -
Superior customer experience
– The customer experience strategy of Water Australian in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Innovation driven organization
– Water Australian is one of the most innovative firm in sector. Manager in The Big Dry and Australia's Water Markets Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Successful track record of launching new products
– Water Australian has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Water Australian 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.
Strong track record of project management
– Water Australian is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Operational resilience
– The operational resilience strategy in the The Big Dry and Australia's Water Markets 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
– Water Australian has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Water Australian to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Cross disciplinary teams
– Horizontal connected teams at the Water Australian 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.
Highly skilled collaborators
– Water Australian 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 The Big Dry and Australia's Water Markets HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High switching costs
– The high switching costs that Water Australian 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.
Learning organization
- Water Australian 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 Water Australian is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in The Big Dry and Australia's Water Markets Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Training and development
– Water Australian has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in The Big Dry and Australia's Water Markets 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
– Water Australian 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 Peter Debaere 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.
Weaknesses The Big Dry and Australia's Water Markets | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The Big Dry and Australia's Water Markets are -
Skills based hiring
– The stress on hiring functional specialists at Water Australian has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Water Australian 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 decision making process
– As mentioned earlier in the report, Water Australian 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. Water Australian 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study The Big Dry and Australia's Water Markets, in the dynamic environment Water Australian has struggled to respond to the nimble upstart competition. Water Australian has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
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 Water Australian supply chain. Even after few cautionary changes mentioned in the HBR case study - The Big Dry and Australia's Water Markets, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Water Australian vulnerable to further global disruptions in South East Asia.
Low market penetration in new markets
– Outside its home market of Water Australian, firm in the HBR case study The Big Dry and Australia's Water Markets needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Lack of clear differentiation of Water Australian products
– To increase the profitability and margins on the products, Water Australian needs to provide more differentiated products than what it is currently offering in the marketplace.
Interest costs
– Compare to the competition, Water Australian 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.
Aligning sales with marketing
– It come across in the case study The Big Dry and Australia's Water Markets 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 The Big Dry and Australia's Water Markets can leverage the sales team experience to cultivate customer relationships as Water Australian is planning to shift buying processes online.
High bargaining power of channel partners
– Because of the regulatory requirements, Peter Debaere suggests that, Water Australian 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Water Australian is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study The Big Dry and Australia's Water Markets 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 The Big Dry and Australia's Water Markets | 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 The Big Dry and Australia's Water Markets are -
Learning at scale
– Online learning technologies has now opened space for Water Australian 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.
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 Water Australian 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Water Australian 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 Water Australian 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 Water Australian to hire the very best people irrespective of their geographical location.
Better consumer reach
– The expansion of the 5G network will help Water Australian to increase its market reach. Water Australian 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 Water Australian in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Global Business segment, and it will provide faster access to the consumers.
Using analytics as competitive advantage
– Water Australian 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 The Big Dry and Australia's Water Markets - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Water Australian to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Water Australian 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, Water Australian 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, The Big Dry and Australia's Water Markets, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Water Australian can use these opportunities to build new business models that can help the communities that Water Australian operates in. Secondly it can use opportunities from government spending in Global Business sector.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Water Australian is facing challenges because of the dominance of functional experts in the organization. The Big Dry and Australia's Water Markets 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.
Loyalty marketing
– Water Australian 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Global Business industry, but it has also influenced the consumer preferences. Water Australian can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats The Big Dry and Australia's Water Markets External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The Big Dry and Australia's Water Markets are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Water Australian with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Water Australian 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.
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. Water Australian needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.
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 Water Australian.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Water Australian in the Global Business industry. The Global Business 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
– Water Australian has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Water Australian needs to keep up with the evolution of technology in the Global Business 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.
Increasing wage structure of Water Australian
– 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 Water Australian.
Easy access to finance
– Easy access to finance in Global Business field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Water Australian can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Consumer confidence and its impact on Water Australian 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.
Shortening product life cycle
– it is one of the major threat that Water Australian is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Water Australian in the Global Business sector and impact the bottomline of the organization.
Environmental challenges
– Water Australian 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. Water Australian can take advantage of this fund but it will also bring new competitors in the Global Business industry.
High dependence on third party suppliers
– Water Australian 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 The Big Dry and Australia's Water Markets 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 The Big Dry and Australia's Water Markets 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 The Big Dry and Australia's Water Markets 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 The Big Dry and Australia's Water Markets 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 The Big Dry and Australia's Water Markets 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 Water Australian needs to make to build a sustainable competitive advantage.