Amul's IT-Enabled Service Delivery to Dairy Farmers SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Amul's IT-Enabled Service Delivery to Dairy Farmers
Kaira District Co-operative Milk Producers' Union Limited (Kaira Union), a member union of the popular dairy brand Amul, was using information technology (IT)-enabled services to benefit individual dairy farmers with very small herd sizes in India. The technical inputs, such as veterinary services, were provided through veterinary centres located near clusters of villages. To improve service delivery, better manage inventory, deploy veterinarians, and manage their routes, the union had established a centralized veterinary call centre staffed at all hours of the day. The call centre had resulted in considerable savings in the cost of service and improved the efficiency of service delivery. The managing director of Kaira Union wanted to extend the call centre to include the union's operations in the states of Maharashtra and West Bengal. However, he was not sure whether the current architecture was capable of facing the challenge. Kaira Union needed to develop a proposal for the expansion. Harekrishna Misra is affiliated with Institute of Rural Management. S. R. Asokan is affiliated with Institute of Rural Management.
Swot Analysis of "Amul's IT-Enabled Service Delivery to Dairy Farmers" written by Harekrishna Misra, S.R. Asokan includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Kaira Union facing as an external strategic factors. Some of the topics covered in Amul's IT-Enabled Service Delivery to Dairy Farmers case study are - Strategic Management Strategies, IT and Global Business.
Some of the macro environment factors that can be used to understand the Amul's IT-Enabled Service Delivery to Dairy Farmers casestudy better are - – competitive advantages are harder to sustain because of technology dispersion, technology disruption, digital marketing is dominated by two big players Facebook and Google, there is increasing trade war between United States & China, increasing inequality as vast percentage of new income is going to the top 1%, increasing energy prices, customer relationship management is fast transforming because of increasing concerns over data privacy,
increasing transportation and logistics costs, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of Amul's IT-Enabled Service Delivery to Dairy Farmers
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Amul's IT-Enabled Service Delivery to Dairy Farmers case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Kaira Union, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Kaira Union 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 Amul's IT-Enabled Service Delivery to Dairy Farmers can be done for the following purposes –
1. Strategic planning using facts provided in Amul's IT-Enabled Service Delivery to Dairy Farmers case study
2. Improving business portfolio management of Kaira Union
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 Kaira Union
Strengths Amul's IT-Enabled Service Delivery to Dairy Farmers | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Kaira Union in Amul's IT-Enabled Service Delivery to Dairy Farmers Harvard Business Review case study are -
High brand equity
– Kaira Union has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Kaira Union to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Operational resilience
– The operational resilience strategy in the Amul's IT-Enabled Service Delivery to Dairy Farmers 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.
Successful track record of launching new products
– Kaira Union has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Kaira Union 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.
High switching costs
– The high switching costs that Kaira Union 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.
Low bargaining power of suppliers
– Suppliers of Kaira Union in the sector have low bargaining power. Amul's IT-Enabled Service Delivery to Dairy Farmers has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Kaira Union to manage not only supply disruptions but also source products at highly competitive prices.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Kaira Union digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Kaira Union 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.
Diverse revenue streams
– Kaira Union is present in almost all the verticals within the industry. This has provided firm in Amul's IT-Enabled Service Delivery to Dairy Farmers case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Ability to lead change in Global Business field
– Kaira Union 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 Kaira Union in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Highly skilled collaborators
– Kaira Union 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 Amul's IT-Enabled Service Delivery to Dairy Farmers HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Training and development
– Kaira Union has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Amul's IT-Enabled Service Delivery to Dairy Farmers 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.
Innovation driven organization
– Kaira Union is one of the most innovative firm in sector. Manager in Amul's IT-Enabled Service Delivery to Dairy Farmers 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 Kaira Union 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.
Weaknesses Amul's IT-Enabled Service Delivery to Dairy Farmers | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Amul's IT-Enabled Service Delivery to Dairy Farmers are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Amul's IT-Enabled Service Delivery to Dairy Farmers 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 Kaira Union has relatively successful track record of launching new products.
High operating costs
– Compare to the competitors, firm in the HBR case study Amul's IT-Enabled Service Delivery to Dairy Farmers 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 Kaira Union 's lucrative customers.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Amul's IT-Enabled Service Delivery to Dairy Farmers, it seems that the employees of Kaira Union 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.
Capital Spending Reduction
– Even during the low interest decade, Kaira Union has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
No frontier risks strategy
– After analyzing the HBR case study Amul's IT-Enabled Service Delivery to Dairy Farmers, 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.
Skills based hiring
– The stress on hiring functional specialists at Kaira Union 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.
Slow to strategic competitive environment developments
– As Amul's IT-Enabled Service Delivery to Dairy Farmers HBR case study mentions - Kaira Union 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.
Increasing silos among functional specialists
– The organizational structure of Kaira Union is dominated by functional specialists. It is not different from other players in the Global Business segment. Kaira Union needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Kaira Union to focus more on services rather than just following the product oriented approach.
Workers concerns about automation
– As automation is fast increasing in the segment, Kaira Union 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Amul's IT-Enabled Service Delivery to Dairy Farmers, in the dynamic environment Kaira Union has struggled to respond to the nimble upstart competition. Kaira Union has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
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 Kaira Union supply chain. Even after few cautionary changes mentioned in the HBR case study - Amul's IT-Enabled Service Delivery to Dairy Farmers, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Kaira Union vulnerable to further global disruptions in South East Asia.
Opportunities Amul's IT-Enabled Service Delivery to Dairy Farmers | 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 Amul's IT-Enabled Service Delivery to Dairy Farmers are -
Learning at scale
– Online learning technologies has now opened space for Kaira Union 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.
Building a culture of innovation
– managers at Kaira Union 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 Kaira Union 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.
Better consumer reach
– The expansion of the 5G network will help Kaira Union to increase its market reach. Kaira Union 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.
Buying journey improvements
– Kaira Union can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Amul's IT-Enabled Service Delivery to Dairy Farmers 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.
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. Kaira Union can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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. Kaira Union can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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. Kaira Union 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. Kaira Union 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.
Manufacturing automation
– Kaira Union 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.
Using analytics as competitive advantage
– Kaira Union 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 Amul's IT-Enabled Service Delivery to Dairy Farmers - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Kaira Union to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Kaira Union can use these opportunities to build new business models that can help the communities that Kaira Union operates in. Secondly it can use opportunities from government spending in Global Business sector.
Developing new processes and practices
– Kaira Union 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Kaira Union 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.
Threats Amul's IT-Enabled Service Delivery to Dairy Farmers External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Amul's IT-Enabled Service Delivery to Dairy Farmers 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 Kaira Union in the Global Business sector and impact the bottomline of the organization.
Environmental challenges
– Kaira Union 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. Kaira Union can take advantage of this fund but it will also bring new competitors in the Global Business industry.
Consumer confidence and its impact on Kaira Union demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Stagnating economy with rate increase
– Kaira Union 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.
Increasing wage structure of Kaira Union
– 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 Kaira Union.
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. Kaira Union 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Amul's IT-Enabled Service Delivery to Dairy Farmers, Kaira Union 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 .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Kaira Union 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.
Technology acceleration in Forth Industrial Revolution
– Kaira Union has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Kaira Union 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.
Shortening product life cycle
– it is one of the major threat that Kaira Union is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Kaira Union needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Kaira Union with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Kaira Union business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of Amul's IT-Enabled Service Delivery to Dairy Farmers 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 Amul's IT-Enabled Service Delivery to Dairy Farmers 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 Amul's IT-Enabled Service Delivery to Dairy Farmers 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 Amul's IT-Enabled Service Delivery to Dairy Farmers 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 Amul's IT-Enabled Service Delivery to Dairy Farmers 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 Kaira Union needs to make to build a sustainable competitive advantage.
