Confectionary Industry: Latin America and the Global Industry in 2006 SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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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 - – increasing government debt because of Covid-19 spendings, competitive advantages are harder to sustain because of technology dispersion, customer relationship management is fast transforming because of increasing concerns over data privacy, banking and financial system is disrupted by Bitcoin and other crypto currencies, challanges to central banks by blockchain based private currencies, cloud computing is disrupting traditional business models, talent flight as more people leaving formal jobs,
technology disruption, there is backlash against globalization, 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 -
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.
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.
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.
Effective Research and Development (R&D)
– Confectionary Industry 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 Confectionary Industry: Latin America and the Global Industry in 2006 - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
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.
Analytics focus
– Confectionary Industry 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 Bruce McKern, Marisol Vidal Palma 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.
Diverse revenue streams
– Confectionary Industry is present in almost all the verticals within the industry. This has provided firm in Confectionary Industry: Latin America and the Global Industry in 2006 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.
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.
Sustainable margins compare to other players in Global Business industry
– Confectionary Industry: Latin America and the Global Industry in 2006 firm has clearly differentiated products in the market place. This has enabled Confectionary Industry to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Confectionary Industry to invest into research and development (R&D) and innovation.
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.
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.
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.
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 cash cycle compare to competitors
Confectionary Industry 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.
Lack of clear differentiation of Confectionary Industry products
– To increase the profitability and margins on the products, Confectionary Industry needs to provide more differentiated products than what it is currently offering in the marketplace.
Interest costs
– Compare to the competition, Confectionary Industry 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.
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.
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.
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.
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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Confectionary Industry: Latin America and the Global Industry in 2006 HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Confectionary Industry has relatively successful track record of launching new products.
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.
High bargaining power of channel partners
– Because of the regulatory requirements, Bruce McKern, Marisol Vidal Palma suggests that, Confectionary Industry 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.
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 -
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.
Leveraging digital technologies
– Confectionary Industry 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Confectionary Industry 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.
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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Confectionary Industry can use these opportunities to build new business models that can help the communities that Confectionary Industry operates in. Secondly it can use opportunities from government spending in Global Business sector.
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. Confectionary Industry can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Building a culture of innovation
– managers at Confectionary Industry 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.
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.
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.
Creating value in data economy
– The success of analytics program of Confectionary Industry has opened avenues for new revenue streams for the organization in the industry. This can help Confectionary Industry to build a more holistic ecosystem as suggested in the Confectionary Industry: Latin America and the Global Industry in 2006 case study. Confectionary Industry can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
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.
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.
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.
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 .
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.
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.
Shortening product life cycle
– it is one of the major threat that Confectionary Industry is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Confectionary Industry 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. Confectionary Industry can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
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.
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.
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.
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Confectionary Industry can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Confectionary Industry: Latin America and the Global Industry in 2006 .
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.
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.