Case Study Description of Bundy Asia Pacific--China Strategy
Phil Stephenson, the director of China for Bundy Asia Pacific (BAP), was preoccupied with Bundy's business in China. BAP's CEO, Tony Martin, had shown Phil the fax from Robin Thompson, the new marketing and product development director of Bundy International, BAP's UK-based parent company. Thompson had asked BAP about its strategy for the refrigeration business in China. Despite 10 years of experience in China, Bundy had not met its market goals. Whatever strategy was developed, it would be an important part of Bundy's proposed global refrigeration strategy. This rich case allows detailed discussion around issues including (a) business (re)development strategy, (b) joint ventures versus wholly owned subsidiaries, (c) organizational structure, and (d) expatriate and local staffing.
Authors :: Paul W. Beamish, Nancy Wang, Steven Zuo
Swot Analysis of "Bundy Asia Pacific--China Strategy" written by Paul W. Beamish, Nancy Wang, Steven Zuo includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Bundy Bap facing as an external strategic factors. Some of the topics covered in Bundy Asia Pacific--China Strategy case study are - Strategic Management Strategies, Joint ventures, Operations management, Strategic planning and Global Business.
Some of the macro environment factors that can be used to understand the Bundy Asia Pacific--China Strategy casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies, cloud computing is disrupting traditional business models, wage bills are increasing, increasing energy prices,
increasing commodity prices, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of Bundy Asia Pacific--China Strategy
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Bundy Asia Pacific--China Strategy case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Bundy Bap, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Bundy Bap 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 Bundy Asia Pacific--China Strategy can be done for the following purposes –
1. Strategic planning using facts provided in Bundy Asia Pacific--China Strategy case study
2. Improving business portfolio management of Bundy Bap
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 Bundy Bap
Strengths Bundy Asia Pacific--China Strategy | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Bundy Bap in Bundy Asia Pacific--China Strategy Harvard Business Review case study are -
Cross disciplinary teams
– Horizontal connected teams at the Bundy Bap 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.
Analytics focus
– Bundy Bap 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 Paul W. Beamish, Nancy Wang, Steven Zuo 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.
Successful track record of launching new products
– Bundy Bap has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Bundy Bap 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.
Ability to lead change in Global Business field
– Bundy Bap 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 Bundy Bap in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Low bargaining power of suppliers
– Suppliers of Bundy Bap in the sector have low bargaining power. Bundy Asia Pacific--China Strategy has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Bundy Bap to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that Bundy Bap has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Learning organization
- Bundy Bap 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 Bundy Bap is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Bundy Asia Pacific--China Strategy Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Superior customer experience
– The customer experience strategy of Bundy Bap in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Sustainable margins compare to other players in Global Business industry
– Bundy Asia Pacific--China Strategy firm has clearly differentiated products in the market place. This has enabled Bundy Bap to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Bundy Bap to invest into research and development (R&D) and innovation.
Operational resilience
– The operational resilience strategy in the Bundy Asia Pacific--China Strategy Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
High brand equity
– Bundy Bap has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Bundy Bap to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Bundy Bap is present in almost all the verticals within the industry. This has provided firm in Bundy Asia Pacific--China Strategy 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.
Weaknesses Bundy Asia Pacific--China Strategy | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Bundy Asia Pacific--China Strategy are -
Slow decision making process
– As mentioned earlier in the report, Bundy Bap has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Bundy Bap even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Bundy Asia Pacific--China Strategy 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 Bundy Bap has relatively successful track record of launching new products.
High cash cycle compare to competitors
Bundy Bap 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.
Skills based hiring
– The stress on hiring functional specialists at Bundy Bap 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Bundy Asia Pacific--China Strategy, in the dynamic environment Bundy Bap has struggled to respond to the nimble upstart competition. Bundy Bap has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
No frontier risks strategy
– After analyzing the HBR case study Bundy Asia Pacific--China Strategy, 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.
Slow to strategic competitive environment developments
– As Bundy Asia Pacific--China Strategy HBR case study mentions - Bundy Bap 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Bundy Bap 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.
Lack of clear differentiation of Bundy Bap products
– To increase the profitability and margins on the products, Bundy Bap needs to provide more differentiated products than what it is currently offering in the marketplace.
High operating costs
– Compare to the competitors, firm in the HBR case study Bundy Asia Pacific--China Strategy 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 Bundy Bap 's lucrative customers.
Increasing silos among functional specialists
– The organizational structure of Bundy Bap is dominated by functional specialists. It is not different from other players in the Global Business segment. Bundy Bap needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Bundy Bap to focus more on services rather than just following the product oriented approach.
Opportunities Bundy Asia Pacific--China Strategy | 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 Bundy Asia Pacific--China Strategy are -
Leveraging digital technologies
– Bundy Bap 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Bundy Bap can use these opportunities to build new business models that can help the communities that Bundy Bap operates in. Secondly it can use opportunities from government spending in Global Business sector.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Bundy Bap 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.
Learning at scale
– Online learning technologies has now opened space for Bundy Bap 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.
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. Bundy Bap can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Developing new processes and practices
– Bundy Bap 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.
Loyalty marketing
– Bundy Bap 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.
Building a culture of innovation
– managers at Bundy Bap 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.
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 Bundy Bap in the consumer business. Now Bundy Bap can target international markets with far fewer capital restrictions requirements than the existing system.
Using analytics as competitive advantage
– Bundy Bap 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 Bundy Asia Pacific--China Strategy - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Bundy Bap 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. Bundy Bap can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Better consumer reach
– The expansion of the 5G network will help Bundy Bap to increase its market reach. Bundy Bap 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Bundy Bap is facing challenges because of the dominance of functional experts in the organization. Bundy Asia Pacific--China Strategy 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.
Threats Bundy Asia Pacific--China Strategy External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Bundy Asia Pacific--China Strategy are -
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.
Regulatory challenges
– Bundy Bap 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.
High dependence on third party suppliers
– Bundy Bap 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.
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. Bundy Bap needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Bundy Bap.
Shortening product life cycle
– it is one of the major threat that Bundy Bap is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Bundy Bap 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 Bundy Bap 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.
Consumer confidence and its impact on Bundy Bap 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.
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 Bundy Bap business can come under increasing regulations regarding data privacy, data security, etc.
Environmental challenges
– Bundy Bap 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. Bundy Bap 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 Bundy Asia Pacific--China Strategy, Bundy Bap 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 .
Increasing wage structure of Bundy Bap
– 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 Bundy Bap.
Weighted SWOT Analysis of Bundy Asia Pacific--China Strategy 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 Bundy Asia Pacific--China Strategy 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 Bundy Asia Pacific--China Strategy 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 Bundy Asia Pacific--China Strategy 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 Bundy Asia Pacific--China Strategy 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 Bundy Bap needs to make to build a sustainable competitive advantage.
