Rwandan Tea Industry: Looking into the Future SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Rwandan Tea Industry: Looking into the Future
In 2003, the Rwandan government was focused on transforming the nation's tea industry into a world-class competitor. To accomplish this objective and stave off the downward prices that plagued the international tea market, the government believed that the industry needed to develop a diversified and value-added product portfolio. This would entail large investments in improving quality and productivity, as well as a new and more competitive price scheme for farmers. Part of the government's strategy for the tea industry involved wide-scale privatization to infuse the industry with capital, competition, and management expertise. But it remained uncertain whether the government could achieve its own objectives while ceding control to private, probably foreign, owners. Could Rwandan tea find its way in a complicated and highly competitive international market?
Swot Analysis of "Rwandan Tea Industry: Looking into the Future" written by Cate Reavis, Debora L. Spar includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Tea Rwandan facing as an external strategic factors. Some of the topics covered in Rwandan Tea Industry: Looking into the Future case study are - Strategic Management Strategies, Emerging markets, Government and Global Business.
Some of the macro environment factors that can be used to understand the Rwandan Tea Industry: Looking into the Future casestudy better are - – cloud computing is disrupting traditional business models, increasing commodity prices, digital marketing is dominated by two big players Facebook and Google, customer relationship management is fast transforming because of increasing concerns over data privacy, talent flight as more people leaving formal jobs, there is increasing trade war between United States & China, geopolitical disruptions,
there is backlash against globalization, increasing energy prices, etc
Introduction to SWOT Analysis of Rwandan Tea Industry: Looking into the Future
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Rwandan Tea Industry: Looking into the Future case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Tea Rwandan, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Tea Rwandan 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 Rwandan Tea Industry: Looking into the Future can be done for the following purposes –
1. Strategic planning using facts provided in Rwandan Tea Industry: Looking into the Future case study
2. Improving business portfolio management of Tea Rwandan
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 Tea Rwandan
Strengths Rwandan Tea Industry: Looking into the Future | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Tea Rwandan in Rwandan Tea Industry: Looking into the Future Harvard Business Review case study are -
High brand equity
– Tea Rwandan has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Tea Rwandan to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Highly skilled collaborators
– Tea Rwandan 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 Rwandan Tea Industry: Looking into the Future HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Diverse revenue streams
– Tea Rwandan is present in almost all the verticals within the industry. This has provided firm in Rwandan Tea Industry: Looking into the Future 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 Global Business field
– Tea Rwandan 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 Tea Rwandan in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Tea Rwandan digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Tea Rwandan 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)
– Tea Rwandan 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 Rwandan Tea Industry: Looking into the Future - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Superior customer experience
– The customer experience strategy of Tea Rwandan in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Innovation driven organization
– Tea Rwandan is one of the most innovative firm in sector. Manager in Rwandan Tea Industry: Looking into the Future Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Organizational Resilience of Tea Rwandan
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Tea Rwandan does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Sustainable margins compare to other players in Global Business industry
– Rwandan Tea Industry: Looking into the Future firm has clearly differentiated products in the market place. This has enabled Tea Rwandan to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Tea Rwandan to invest into research and development (R&D) and innovation.
Training and development
– Tea Rwandan has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Rwandan Tea Industry: Looking into the Future 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.
Learning organization
- Tea Rwandan 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 Tea Rwandan is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Rwandan Tea Industry: Looking into the Future Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses Rwandan Tea Industry: Looking into the Future | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Rwandan Tea Industry: Looking into the Future are -
Increasing silos among functional specialists
– The organizational structure of Tea Rwandan is dominated by functional specialists. It is not different from other players in the Global Business segment. Tea Rwandan needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Tea Rwandan to focus more on services rather than just following the product oriented approach.
Low market penetration in new markets
– Outside its home market of Tea Rwandan, firm in the HBR case study Rwandan Tea Industry: Looking into the Future needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High cash cycle compare to competitors
Tea Rwandan 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Tea Rwandan is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Rwandan Tea Industry: Looking into the Future can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Rwandan Tea Industry: Looking into the Future, it seems that the employees of Tea Rwandan 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.
Need for greater diversity
– Tea Rwandan 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Tea Rwandan 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.
Interest costs
– Compare to the competition, Tea Rwandan 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 Tea Rwandan products
– To increase the profitability and margins on the products, Tea Rwandan needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to strategic competitive environment developments
– As Rwandan Tea Industry: Looking into the Future HBR case study mentions - Tea Rwandan 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Rwandan Tea Industry: Looking into the Future, is just above the industry average. Tea Rwandan 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.
Opportunities Rwandan Tea Industry: Looking into the Future | 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 Rwandan Tea Industry: Looking into the Future are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Tea Rwandan 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, Rwandan Tea Industry: Looking into the Future, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Tea Rwandan can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Buying journey improvements
– Tea Rwandan can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Rwandan Tea Industry: Looking into the Future 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Tea Rwandan is facing challenges because of the dominance of functional experts in the organization. Rwandan Tea Industry: Looking into the Future 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Tea Rwandan 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.
Building a culture of innovation
– managers at Tea Rwandan 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 Global Business segment.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Tea Rwandan can use these opportunities to build new business models that can help the communities that Tea Rwandan operates in. Secondly it can use opportunities from government spending in Global Business sector.
Leveraging digital technologies
– Tea Rwandan 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.
Loyalty marketing
– Tea Rwandan 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.
Better consumer reach
– The expansion of the 5G network will help Tea Rwandan to increase its market reach. Tea Rwandan 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.
Developing new processes and practices
– Tea Rwandan can develop new processes and procedures in Global Business 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
– Tea Rwandan 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 Rwandan Tea Industry: Looking into the Future - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Tea Rwandan to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Tea Rwandan can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats Rwandan Tea Industry: Looking into the Future External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Rwandan Tea Industry: Looking into the Future are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Tea Rwandan with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing wage structure of Tea Rwandan
– 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 Tea Rwandan.
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 Tea Rwandan business can come under increasing regulations regarding data privacy, data security, etc.
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. Tea Rwandan can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Shortening product life cycle
– it is one of the major threat that Tea Rwandan is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Environmental challenges
– Tea Rwandan 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. Tea Rwandan can take advantage of this fund but it will also bring new competitors in the Global Business industry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Rwandan Tea Industry: Looking into the Future, Tea Rwandan may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Global Business .
Consumer confidence and its impact on Tea Rwandan 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.
Stagnating economy with rate increase
– Tea Rwandan 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.
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 Tea Rwandan in the Global Business 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 Tea Rwandan 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.
High dependence on third party suppliers
– Tea Rwandan 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 Rwandan Tea Industry: Looking into the Future 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 Rwandan Tea Industry: Looking into the Future 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 Rwandan Tea Industry: Looking into the Future 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 Rwandan Tea Industry: Looking into the Future 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 Rwandan Tea Industry: Looking into the Future 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 Tea Rwandan needs to make to build a sustainable competitive advantage.