Horse Trading: Food Sourcing in the Twenty-First Century SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

Case Study SWOT Analysis Solution

Case Study Description of Horse Trading: Food Sourcing in the Twenty-First Century

In January 2013, Irish authorities were the first to uncover the year's first food sourcing scandal: horsemeat sold as beef on supermarket shelves. It was not long before regulators and retailers realized the problem was truly a continental one. The incident involved French exporters, Luxembourger production facilities, Cypriot and Dutch meat traders, British and Swedish retailers, and Romanian horsemeat. Food service providers and retailers were forced to test beef products to ensure they were horse-free, pulling products that contained traces of equine meat. British supermarkets alone disposed of an estimated 10 million "beef" burgers in the wake of the scandal. This case is an example of the challenges of managing the complex global supply chains that make up the modern food industry. In this class discussion, students will use concepts from management, economics, and public policy to assess the damage of this event and to analyze strategies for preventing similar incidents in the future.

Authors :: Russell Walker, Joanna Wilson

Topics :: Global Business

Tags :: Economics, International business, Public relations, Risk management, Supply chain, SWOT Analysis, SWOT Matrix, TOWS, Weighted SWOT Analysis

Swot Analysis of "Horse Trading: Food Sourcing in the Twenty-First Century" written by Russell Walker, Joanna Wilson includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Beef Horsemeat facing as an external strategic factors. Some of the topics covered in Horse Trading: Food Sourcing in the Twenty-First Century case study are - Strategic Management Strategies, Economics, International business, Public relations, Risk management, Supply chain and Global Business.

Some of the macro environment factors that can be used to understand the Horse Trading: Food Sourcing in the Twenty-First Century casestudy better are - – increasing transportation and logistics costs, digital marketing is dominated by two big players Facebook and Google, wage bills are increasing, central banks are concerned over increasing inflation, competitive advantages are harder to sustain because of technology dispersion, increasing household debt because of falling income levels, challanges to central banks by blockchain based private currencies, increasing government debt because of Covid-19 spendings, there is backlash against globalization, etc

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Introduction to SWOT Analysis of Horse Trading: Food Sourcing in the Twenty-First Century

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Horse Trading: Food Sourcing in the Twenty-First Century case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Beef Horsemeat, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Beef Horsemeat 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of Horse Trading: Food Sourcing in the Twenty-First Century can be done for the following purposes –
1. Strategic planning using facts provided in Horse Trading: Food Sourcing in the Twenty-First Century case study
2. Improving business portfolio management of Beef Horsemeat
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 Beef Horsemeat

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Strengths Horse Trading: Food Sourcing in the Twenty-First Century | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Beef Horsemeat in Horse Trading: Food Sourcing in the Twenty-First Century Harvard Business Review case study are -

Cross disciplinary teams

– Horizontal connected teams at the Beef Horsemeat 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.

Ability to lead change in Global Business field

– Beef Horsemeat 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 Beef Horsemeat in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

Training and development

– Beef Horsemeat has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Horse Trading: Food Sourcing in the Twenty-First Century 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.

Effective Research and Development (R&D)

– Beef Horsemeat 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 Horse Trading: Food Sourcing in the Twenty-First Century - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

Diverse revenue streams

– Beef Horsemeat is present in almost all the verticals within the industry. This has provided firm in Horse Trading: Food Sourcing in the Twenty-First Century 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.

Successful track record of launching new products

– Beef Horsemeat has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Beef Horsemeat 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

- Beef Horsemeat 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 Beef Horsemeat is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Horse Trading: Food Sourcing in the Twenty-First Century Harvard Business Review case study emphasize – knowledge, initiative, and innovation.

Operational resilience

– The operational resilience strategy in the Horse Trading: Food Sourcing in the Twenty-First Century 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.

Highly skilled collaborators

– Beef Horsemeat 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 Horse Trading: Food Sourcing in the Twenty-First Century HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.

Low bargaining power of suppliers

– Suppliers of Beef Horsemeat in the sector have low bargaining power. Horse Trading: Food Sourcing in the Twenty-First Century has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Beef Horsemeat to manage not only supply disruptions but also source products at highly competitive prices.

Strong track record of project management

– Beef Horsemeat is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Ability to recruit top talent

– Beef Horsemeat is one of the leading recruiters in the industry. Managers in the Horse Trading: Food Sourcing in the Twenty-First Century are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.

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Weaknesses Horse Trading: Food Sourcing in the Twenty-First Century | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Horse Trading: Food Sourcing in the Twenty-First Century are -

Capital Spending Reduction

– Even during the low interest decade, Beef Horsemeat 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.

High dependence on star products

– The top 2 products and services of the firm as mentioned in the Horse Trading: Food Sourcing in the Twenty-First Century 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 Beef Horsemeat 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 Horse Trading: Food Sourcing in the Twenty-First Century, in the dynamic environment Beef Horsemeat has struggled to respond to the nimble upstart competition. Beef Horsemeat has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

Increasing silos among functional specialists

– The organizational structure of Beef Horsemeat is dominated by functional specialists. It is not different from other players in the Global Business segment. Beef Horsemeat needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Beef Horsemeat to focus more on services rather than just following the product oriented approach.

Slow decision making process

– As mentioned earlier in the report, Beef Horsemeat 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. Beef Horsemeat 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 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 Beef Horsemeat supply chain. Even after few cautionary changes mentioned in the HBR case study - Horse Trading: Food Sourcing in the Twenty-First Century, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Beef Horsemeat vulnerable to further global disruptions in South East Asia.

Compensation and incentives

– The revenue per employee as mentioned in the HBR case study Horse Trading: Food Sourcing in the Twenty-First Century, is just above the industry average. Beef Horsemeat 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.

Interest costs

– Compare to the competition, Beef Horsemeat 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.

Aligning sales with marketing

– It come across in the case study Horse Trading: Food Sourcing in the Twenty-First Century that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Horse Trading: Food Sourcing in the Twenty-First Century can leverage the sales team experience to cultivate customer relationships as Beef Horsemeat is planning to shift buying processes online.

Employees’ incomplete understanding of strategy

– From the instances in the HBR case study Horse Trading: Food Sourcing in the Twenty-First Century, it seems that the employees of Beef Horsemeat 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.

Lack of clear differentiation of Beef Horsemeat products

– To increase the profitability and margins on the products, Beef Horsemeat needs to provide more differentiated products than what it is currently offering in the marketplace.

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Opportunities Horse Trading: Food Sourcing in the Twenty-First Century | 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 Horse Trading: Food Sourcing in the Twenty-First Century are -

Using analytics as competitive advantage

– Beef Horsemeat 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 Horse Trading: Food Sourcing in the Twenty-First Century - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Beef Horsemeat to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.

Buying journey improvements

– Beef Horsemeat can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Horse Trading: Food Sourcing in the Twenty-First Century 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.

Manufacturing automation

– Beef Horsemeat 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.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Beef Horsemeat to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Beef Horsemeat to hire the very best people irrespective of their geographical location.

Better consumer reach

– The expansion of the 5G network will help Beef Horsemeat to increase its market reach. Beef Horsemeat 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.

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. Beef Horsemeat can explore opportunities that can attract volunteers and are consistent with its mission and vision.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Beef Horsemeat can use these opportunities to build new business models that can help the communities that Beef Horsemeat 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 Beef Horsemeat in the consumer business. Now Beef Horsemeat can target international markets with far fewer capital restrictions requirements than the existing system.

Leveraging digital technologies

– Beef Horsemeat 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.

Redefining models of collaboration and team work

– As explained in the weaknesses section, Beef Horsemeat is facing challenges because of the dominance of functional experts in the organization. Horse Trading: Food Sourcing in the Twenty-First Century 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.

Building a culture of innovation

– managers at Beef Horsemeat 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.

Loyalty marketing

– Beef Horsemeat 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.

Developing new processes and practices

– Beef Horsemeat 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.

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Threats Horse Trading: Food Sourcing in the Twenty-First Century External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats mentioned in the HBR case study Horse Trading: Food Sourcing in the Twenty-First Century are -

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, Beef Horsemeat 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 Horse Trading: Food Sourcing in the Twenty-First Century .

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. Beef Horsemeat needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.

Technology acceleration in Forth Industrial Revolution

– Beef Horsemeat has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Beef Horsemeat 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.

Regulatory challenges

– Beef Horsemeat 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.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Beef Horsemeat with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.

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.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Beef Horsemeat 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.

Shortening product life cycle

– it is one of the major threat that Beef Horsemeat is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

Environmental challenges

– Beef Horsemeat 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. Beef Horsemeat can take advantage of this fund but it will also bring new competitors in the Global Business industry.

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 Beef Horsemeat business can come under increasing regulations regarding data privacy, data security, 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 Beef Horsemeat in the Global Business sector and impact the bottomline of the organization.

Increasing wage structure of Beef Horsemeat

– 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 Beef Horsemeat.

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 Beef Horsemeat.

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Weighted SWOT Analysis of Horse Trading: Food Sourcing in the Twenty-First Century 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 Horse Trading: Food Sourcing in the Twenty-First Century 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 Horse Trading: Food Sourcing in the Twenty-First Century 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 Horse Trading: Food Sourcing in the Twenty-First Century 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 Horse Trading: Food Sourcing in the Twenty-First Century 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 Beef Horsemeat needs to make to build a sustainable competitive advantage.

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