International Lobbying and The Dow Chemical Company (A) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of International Lobbying and The Dow Chemical Company (A)
This case explores company strategy, business-government relations, and collective action challenges associated with international and domestic lobbying regarding regulation of the chemical industry. In the fall of 2006, a five-year legislative process for a major new law regulating chemicals in the European Union appeared to be nearing its conclusion. REACH, the Registration, Evaluation, Authorization, and Restriction of Chemicals, would create a new European Chemicals Agency, require companies to submit testing data on existing and new compounds, and restrict the manufacture of hazardous substances. Andrew Liveris, CEO of the Dow Chemical Company, has to decide whether the company should engage in direct discussions with the European Parliament and Commission, with the implication that the company can influence the regulations but also would have to support the final outcome. The case summarizes Dow's history, competitive dynamics in the sector, and regulation of the chemical industry before describing the REACH legislative process and various approaches to lobbying used by chemical companies, trade groups, and environmental NGOs.
Authors :: Arthur A. Daemmrich
Topics :: Global Business
Tags :: International business, Product development, Public relations, SWOT Analysis, SWOT Matrix, TOWS, Weighted SWOT Analysis
Swot Analysis of "International Lobbying and The Dow Chemical Company (A)" written by Arthur A. Daemmrich includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Chemical Lobbying facing as an external strategic factors. Some of the topics covered in International Lobbying and The Dow Chemical Company (A) case study are - Strategic Management Strategies, International business, Product development, Public relations and Global Business.
Some of the macro environment factors that can be used to understand the International Lobbying and The Dow Chemical Company (A) casestudy better are - – digital marketing is dominated by two big players Facebook and Google, competitive advantages are harder to sustain because of technology dispersion, supply chains are disrupted by pandemic , there is increasing trade war between United States & China, banking and financial system is disrupted by Bitcoin and other crypto currencies, there is backlash against globalization, increasing inequality as vast percentage of new income is going to the top 1%,
cloud computing is disrupting traditional business models, technology disruption, etc
Introduction to SWOT Analysis of International Lobbying and The Dow Chemical Company (A)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in International Lobbying and The Dow Chemical Company (A) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Chemical Lobbying, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Chemical Lobbying 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 International Lobbying and The Dow Chemical Company (A) can be done for the following purposes –
1. Strategic planning using facts provided in International Lobbying and The Dow Chemical Company (A) case study
2. Improving business portfolio management of Chemical Lobbying
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 Chemical Lobbying
Strengths International Lobbying and The Dow Chemical Company (A) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Chemical Lobbying in International Lobbying and The Dow Chemical Company (A) Harvard Business Review case study are -
Successful track record of launching new products
– Chemical Lobbying has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Chemical Lobbying 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.
Learning organization
- Chemical Lobbying 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 Chemical Lobbying is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in International Lobbying and The Dow Chemical Company (A) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Low bargaining power of suppliers
– Suppliers of Chemical Lobbying in the sector have low bargaining power. International Lobbying and The Dow Chemical Company (A) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Chemical Lobbying to manage not only supply disruptions but also source products at highly competitive prices.
Diverse revenue streams
– Chemical Lobbying is present in almost all the verticals within the industry. This has provided firm in International Lobbying and The Dow Chemical Company (A) 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.
Cross disciplinary teams
– Horizontal connected teams at the Chemical Lobbying 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.
Innovation driven organization
– Chemical Lobbying is one of the most innovative firm in sector. Manager in International Lobbying and The Dow Chemical Company (A) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Analytics focus
– Chemical Lobbying 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 Arthur A. Daemmrich 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.
High switching costs
– The high switching costs that Chemical Lobbying 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.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Chemical Lobbying digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Chemical Lobbying 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.
High brand equity
– Chemical Lobbying has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Chemical Lobbying to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to recruit top talent
– Chemical Lobbying is one of the leading recruiters in the industry. Managers in the International Lobbying and The Dow Chemical Company (A) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Ability to lead change in Global Business field
– Chemical Lobbying 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 Chemical Lobbying in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Weaknesses International Lobbying and The Dow Chemical Company (A) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of International Lobbying and The Dow Chemical Company (A) are -
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study International Lobbying and The Dow Chemical Company (A), is just above the industry average. Chemical Lobbying needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
High bargaining power of channel partners
– Because of the regulatory requirements, Arthur A. Daemmrich suggests that, Chemical Lobbying 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.
No frontier risks strategy
– After analyzing the HBR case study International Lobbying and The Dow Chemical Company (A), it seems that company is thinking about the frontier risks that can impact Global Business strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study International Lobbying and The Dow Chemical Company (A), in the dynamic environment Chemical Lobbying has struggled to respond to the nimble upstart competition. Chemical Lobbying has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Workers concerns about automation
– As automation is fast increasing in the segment, Chemical Lobbying 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.
Products dominated business model
– Even though Chemical Lobbying 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 - International Lobbying and The Dow Chemical Company (A) should strive to include more intangible value offerings along with its core products and services.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the International Lobbying and The Dow Chemical Company (A) 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 Chemical Lobbying has relatively successful track record of launching new products.
Need for greater diversity
– Chemical Lobbying 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.
Skills based hiring
– The stress on hiring functional specialists at Chemical Lobbying 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.
Lack of clear differentiation of Chemical Lobbying products
– To increase the profitability and margins on the products, Chemical Lobbying needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Chemical Lobbying 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.
Opportunities International Lobbying and The Dow Chemical Company (A) | 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 International Lobbying and The Dow Chemical Company (A) are -
Using analytics as competitive advantage
– Chemical Lobbying 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 International Lobbying and The Dow Chemical Company (A) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Chemical Lobbying 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 Chemical Lobbying can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Loyalty marketing
– Chemical Lobbying 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.
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. Chemical Lobbying can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Manufacturing automation
– Chemical Lobbying 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. Chemical Lobbying 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. Chemical Lobbying 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.
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. Chemical Lobbying can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Chemical Lobbying can use these opportunities to build new business models that can help the communities that Chemical Lobbying operates in. Secondly it can use opportunities from government spending in Global Business sector.
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 Chemical Lobbying in the consumer business. Now Chemical Lobbying can target international markets with far fewer capital restrictions requirements than the existing system.
Leveraging digital technologies
– Chemical Lobbying 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.
Buying journey improvements
– Chemical Lobbying can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. International Lobbying and The Dow Chemical Company (A) 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Chemical Lobbying 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.
Creating value in data economy
– The success of analytics program of Chemical Lobbying has opened avenues for new revenue streams for the organization in the industry. This can help Chemical Lobbying to build a more holistic ecosystem as suggested in the International Lobbying and The Dow Chemical Company (A) case study. Chemical Lobbying can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats International Lobbying and The Dow Chemical Company (A) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study International Lobbying and The Dow Chemical Company (A) are -
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 Chemical Lobbying in the Global Business sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Chemical Lobbying 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Chemical Lobbying with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Stagnating economy with rate increase
– Chemical Lobbying 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.
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 Chemical Lobbying business can come under increasing regulations regarding data privacy, data security, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Chemical Lobbying 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.
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 Chemical Lobbying.
Shortening product life cycle
– it is one of the major threat that Chemical Lobbying is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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.
Consumer confidence and its impact on Chemical Lobbying 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.
Environmental challenges
– Chemical Lobbying 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. Chemical Lobbying can take advantage of this fund but it will also bring new competitors in the Global Business industry.
Technology acceleration in Forth Industrial Revolution
– Chemical Lobbying has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Chemical Lobbying 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study International Lobbying and The Dow Chemical Company (A), Chemical Lobbying 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 .
Weighted SWOT Analysis of International Lobbying and The Dow Chemical Company (A) 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 International Lobbying and The Dow Chemical Company (A) 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 International Lobbying and The Dow Chemical Company (A) 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 International Lobbying and The Dow Chemical Company (A) 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 International Lobbying and The Dow Chemical Company (A) 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 Chemical Lobbying needs to make to build a sustainable competitive advantage.