Confectionary Industry: Latin America and the Global Industry in 2006 SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Confectionary Industry: Latin America and the Global Industry in 2006
In 2006, the confectionary industry is one of the most dynamic and innovative sectors within the food industry. Although its fragmented nature across the globe allows the entrance of new competitors, consumers favor established brands and new entrants are required to make large investments in marketing and advertising to build brand awareness. As opposed to other food segments, the confectionary industry also depends on consumer impulse purchases, which challenge emerging and established manufacturers to preserve affordability, availability, and attractive packaging and presentation of their products. Moreover, new product development is essential to protecting and increasing market share, with changes in consumer attitudes and preferences demanding ongoing innovation in new areas such as "limited editions," "sugar-free" products, and new product lines. Explores the global confectionary industry in 2006 and also examines specific forces at play in the Latin American confectionary market.
Swot Analysis of "Confectionary Industry: Latin America and the Global Industry in 2006" written by Bruce McKern, Marisol Vidal Palma includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Confectionary Industry facing as an external strategic factors. Some of the topics covered in Confectionary Industry: Latin America and the Global Industry in 2006 case study are - Strategic Management Strategies, Globalization, Growth strategy, Strategic planning and Global Business.
Some of the macro environment factors that can be used to understand the Confectionary Industry: Latin America and the Global Industry in 2006 casestudy better are - – central banks are concerned over increasing inflation, there is backlash against globalization, increasing transportation and logistics costs, banking and financial system is disrupted by Bitcoin and other crypto currencies, talent flight as more people leaving formal jobs, increasing household debt because of falling income levels, competitive advantages are harder to sustain because of technology dispersion,
there is increasing trade war between United States & China, increasing commodity prices, etc
Introduction to SWOT Analysis of Confectionary Industry: Latin America and the Global Industry in 2006
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Confectionary Industry: Latin America and the Global Industry in 2006 case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Confectionary Industry, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Confectionary Industry 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 Confectionary Industry: Latin America and the Global Industry in 2006 can be done for the following purposes –
1. Strategic planning using facts provided in Confectionary Industry: Latin America and the Global Industry in 2006 case study
2. Improving business portfolio management of Confectionary Industry
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 Confectionary Industry
Strengths Confectionary Industry: Latin America and the Global Industry in 2006 | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Confectionary Industry in Confectionary Industry: Latin America and the Global Industry in 2006 Harvard Business Review case study are -
Superior customer experience
– The customer experience strategy of Confectionary Industry in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Innovation driven organization
– Confectionary Industry is one of the most innovative firm in sector. Manager in Confectionary Industry: Latin America and the Global Industry in 2006 Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Cross disciplinary teams
– Horizontal connected teams at the Confectionary Industry 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
– Confectionary Industry 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 Confectionary Industry: Latin America and the Global Industry in 2006 HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Confectionary Industry digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Confectionary Industry 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.
Organizational Resilience of Confectionary Industry
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Confectionary Industry does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– Confectionary Industry has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Confectionary Industry: Latin America and the Global Industry in 2006 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 Confectionary Industry 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.
Ability to recruit top talent
– Confectionary Industry is one of the leading recruiters in the industry. Managers in the Confectionary Industry: Latin America and the Global Industry in 2006 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
– Confectionary Industry is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Low bargaining power of suppliers
– Suppliers of Confectionary Industry in the sector have low bargaining power. Confectionary Industry: Latin America and the Global Industry in 2006 has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Confectionary Industry to manage not only supply disruptions but also source products at highly competitive prices.
Operational resilience
– The operational resilience strategy in the Confectionary Industry: Latin America and the Global Industry in 2006 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.
Weaknesses Confectionary Industry: Latin America and the Global Industry in 2006 | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Confectionary Industry: Latin America and the Global Industry in 2006 are -
Workers concerns about automation
– As automation is fast increasing in the segment, Confectionary Industry 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Confectionary Industry: Latin America and the Global Industry in 2006 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 Confectionary Industry 's lucrative customers.
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 Confectionary Industry supply chain. Even after few cautionary changes mentioned in the HBR case study - Confectionary Industry: Latin America and the Global Industry in 2006, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Confectionary Industry vulnerable to further global disruptions in South East Asia.
Need for greater diversity
– Confectionary Industry 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.
Increasing silos among functional specialists
– The organizational structure of Confectionary Industry is dominated by functional specialists. It is not different from other players in the Global Business segment. Confectionary Industry needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Confectionary Industry to focus more on services rather than just following the product oriented approach.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Confectionary Industry: Latin America and the Global Industry in 2006, in the dynamic environment Confectionary Industry has struggled to respond to the nimble upstart competition. Confectionary Industry has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Confectionary Industry is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Confectionary Industry: Latin America and the Global Industry in 2006 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 Confectionary Industry: Latin America and the Global Industry in 2006, it seems that the employees of Confectionary Industry 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.
Products dominated business model
– Even though Confectionary Industry has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Confectionary Industry: Latin America and the Global Industry in 2006 should strive to include more intangible value offerings along with its core products and services.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Confectionary Industry: Latin America and the Global Industry in 2006, is just above the industry average. Confectionary Industry 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.
Skills based hiring
– The stress on hiring functional specialists at Confectionary Industry 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.
Opportunities Confectionary Industry: Latin America and the Global Industry in 2006 | 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 Confectionary Industry: Latin America and the Global Industry in 2006 are -
Manufacturing automation
– Confectionary Industry can use the latest technology developments to improve its manufacturing and designing process in Global Business 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Global Business industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Confectionary Industry can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Confectionary Industry can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
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. Confectionary Industry can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Confectionary Industry 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, Confectionary Industry: Latin America and the Global Industry in 2006, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Confectionary Industry 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Confectionary Industry is facing challenges because of the dominance of functional experts in the organization. Confectionary Industry: Latin America and the Global Industry in 2006 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
– Confectionary Industry 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.
Learning at scale
– Online learning technologies has now opened space for Confectionary Industry 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.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Confectionary Industry in the consumer business. Now Confectionary Industry can target international markets with far fewer capital restrictions requirements than the existing system.
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 Confectionary Industry 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Confectionary Industry 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 Confectionary Industry to hire the very best people irrespective of their geographical location.
Better consumer reach
– The expansion of the 5G network will help Confectionary Industry to increase its market reach. Confectionary Industry 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.
Using analytics as competitive advantage
– Confectionary Industry 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 Confectionary Industry: Latin America and the Global Industry in 2006 - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Confectionary Industry to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Confectionary Industry: Latin America and the Global Industry in 2006 External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Confectionary Industry: Latin America and the Global Industry in 2006 are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Confectionary Industry: Latin America and the Global Industry in 2006, Confectionary Industry 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 .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Confectionary Industry with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Confectionary Industry needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.
Environmental challenges
– Confectionary Industry 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. Confectionary Industry can take advantage of this fund but it will also bring new competitors in the Global Business industry.
Consumer confidence and its impact on Confectionary Industry 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.
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. Confectionary Industry will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Confectionary Industry in the Global Business 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 Confectionary Industry.
High dependence on third party suppliers
– Confectionary Industry 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.
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.
Increasing wage structure of Confectionary Industry
– 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 Confectionary Industry.
Regulatory challenges
– Confectionary Industry 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 Global Business industry regulations.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Confectionary Industry 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.
Weighted SWOT Analysis of Confectionary Industry: Latin America and the Global Industry in 2006 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 Confectionary Industry: Latin America and the Global Industry in 2006 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 Confectionary Industry: Latin America and the Global Industry in 2006 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 Confectionary Industry: Latin America and the Global Industry in 2006 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 Confectionary Industry: Latin America and the Global Industry in 2006 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 Confectionary Industry needs to make to build a sustainable competitive advantage.
