Roger Cosgrove had to make a decision on what to do with his employee, Jennifer Johnson, whom he learned had allegedly stolen $120,000 from his former business associate, Michael Libretti. He was conflicted by the ethical dilemmas this issue raised. In April 2011, Cosgrove had a chance meeting with Libretti at Libretti's place of business, Starbright Jewelers. Cosgrove and Libretti once operated Starbright in a joint operation but, because of changing economic conditions, dissolved their joint operation amicably in 2008. Johnson, who had worked for both men at Starbright, elected, at Cosgrove's request, to follow him to his new business venture, Silver Shine. She continued to work part time on Saturdays for Libretti at Starbright, to supplement her income. Cosgrove and Libretti had remained friends, and occasionally met to catch up on news. It was at one of these get-togethers that Cosgrove heard from Libretti the accusation of theft. Johnson had left her part-time job at Starbright in 2010 on her own accord. When Libretti subsequently hired a replacement for Johnson, he discovered through the replacement's efforts that Johnson stole about $120,000 from him from 2004 through 2010. After Libretti shared with Cosgrove this story, he asked Cosgrove what he, Cosgrove, was going to do, in Libretti's words, "with the thief who is working for you now." Cosgrove had to balance the competing needs of the many persons who had an interest in his decision. He wanted to protect his business, his reputation, and his customers from exposure to a potential thief. He wanted to protect his family's well-being and also to be supportive to his business associate, Libretti. Even so, he felt that taking action on Johnson was assuming she was guilty already, without benefit of any investigation. He sought advice from several sources, and was frustrated that there was no clear direction to follow.
Swot Analysis of "Starbright Jewelers" written by Karen E. Boroff, Samantha Lordi includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Cosgrove Libretti facing as an external strategic factors. Some of the topics covered in Starbright Jewelers case study are - Strategic Management Strategies, Decision making, Ethics, Human resource management and Global Business.
Some of the macro environment factors that can be used to understand the Starbright Jewelers casestudy better are - – increasing transportation and logistics costs, there is backlash against globalization, central banks are concerned over increasing inflation, increasing household debt because of falling income levels, increasing energy prices, technology disruption, increasing inequality as vast percentage of new income is going to the top 1%,
there is increasing trade war between United States & China, wage bills are increasing, etc
Introduction to SWOT Analysis of Starbright Jewelers
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Starbright Jewelers case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Cosgrove Libretti, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Cosgrove Libretti 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 Starbright Jewelers can be done for the following purposes –
1. Strategic planning using facts provided in Starbright Jewelers case study
2. Improving business portfolio management of Cosgrove Libretti
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 Cosgrove Libretti
Strengths Starbright Jewelers | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Cosgrove Libretti in Starbright Jewelers Harvard Business Review case study are -
Ability to lead change in Global Business field
– Cosgrove Libretti 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 Cosgrove Libretti in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Cross disciplinary teams
– Horizontal connected teams at the Cosgrove Libretti 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.
Effective Research and Development (R&D)
– Cosgrove Libretti 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 Starbright Jewelers - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Cosgrove Libretti digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Cosgrove Libretti 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.
Superior customer experience
– The customer experience strategy of Cosgrove Libretti in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Successful track record of launching new products
– Cosgrove Libretti has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Cosgrove Libretti 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.
Operational resilience
– The operational resilience strategy in the Starbright Jewelers 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.
Learning organization
- Cosgrove Libretti 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 Cosgrove Libretti is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Starbright Jewelers Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Analytics focus
– Cosgrove Libretti 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 Karen E. Boroff, Samantha Lordi 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.
Training and development
– Cosgrove Libretti has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Starbright Jewelers 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.
Highly skilled collaborators
– Cosgrove Libretti 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 Starbright Jewelers HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Sustainable margins compare to other players in Global Business industry
– Starbright Jewelers firm has clearly differentiated products in the market place. This has enabled Cosgrove Libretti to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Cosgrove Libretti to invest into research and development (R&D) and innovation.
Weaknesses Starbright Jewelers | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Starbright Jewelers are -
Slow to strategic competitive environment developments
– As Starbright Jewelers HBR case study mentions - Cosgrove Libretti 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, Cosgrove Libretti 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Starbright Jewelers, is just above the industry average. Cosgrove Libretti 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 operating costs
– Compare to the competitors, firm in the HBR case study Starbright Jewelers 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 Cosgrove Libretti 's lucrative customers.
Skills based hiring
– The stress on hiring functional specialists at Cosgrove Libretti 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 decision making process
– As mentioned earlier in the report, Cosgrove Libretti 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. Cosgrove Libretti 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 bargaining power of channel partners
– Because of the regulatory requirements, Karen E. Boroff, Samantha Lordi suggests that, Cosgrove Libretti 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.
High cash cycle compare to competitors
Cosgrove Libretti 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.
Low market penetration in new markets
– Outside its home market of Cosgrove Libretti, firm in the HBR case study Starbright Jewelers needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Need for greater diversity
– Cosgrove Libretti 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.
No frontier risks strategy
– After analyzing the HBR case study Starbright Jewelers, 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.
Opportunities Starbright Jewelers | 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 Starbright Jewelers are -
Loyalty marketing
– Cosgrove Libretti 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Cosgrove Libretti is facing challenges because of the dominance of functional experts in the organization. Starbright Jewelers 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.
Manufacturing automation
– Cosgrove Libretti 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. Cosgrove Libretti 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. Cosgrove Libretti 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.
Creating value in data economy
– The success of analytics program of Cosgrove Libretti has opened avenues for new revenue streams for the organization in the industry. This can help Cosgrove Libretti to build a more holistic ecosystem as suggested in the Starbright Jewelers case study. Cosgrove Libretti can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Cosgrove Libretti 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 Cosgrove Libretti to hire the very best people irrespective of their geographical location.
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 Cosgrove Libretti in the consumer business. Now Cosgrove Libretti can target international markets with far fewer capital restrictions requirements than the existing system.
Building a culture of innovation
– managers at Cosgrove Libretti 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.
Leveraging digital technologies
– Cosgrove Libretti 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.
Learning at scale
– Online learning technologies has now opened space for Cosgrove Libretti 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.
Better consumer reach
– The expansion of the 5G network will help Cosgrove Libretti to increase its market reach. Cosgrove Libretti 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.
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. Cosgrove Libretti can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Using analytics as competitive advantage
– Cosgrove Libretti 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 Starbright Jewelers - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Cosgrove Libretti to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Starbright Jewelers External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Starbright Jewelers are -
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 Cosgrove Libretti.
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 Cosgrove Libretti business can come under increasing regulations regarding data privacy, data security, etc.
Consumer confidence and its impact on Cosgrove Libretti 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.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Cosgrove Libretti with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Easy access to finance
– Easy access to finance in Global Business field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Cosgrove Libretti can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Stagnating economy with rate increase
– Cosgrove Libretti 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.
Regulatory challenges
– Cosgrove Libretti needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Global Business industry regulations.
Increasing wage structure of Cosgrove Libretti
– 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 Cosgrove Libretti.
Environmental challenges
– Cosgrove Libretti 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. Cosgrove Libretti can take advantage of this fund but it will also bring new competitors in the Global Business industry.
Technology acceleration in Forth Industrial Revolution
– Cosgrove Libretti has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Cosgrove Libretti 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.
High dependence on third party suppliers
– Cosgrove Libretti 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.
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. Cosgrove Libretti 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.
Weighted SWOT Analysis of Starbright Jewelers 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 Starbright Jewelers 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 Starbright Jewelers 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 Starbright Jewelers 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 Starbright Jewelers 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 Cosgrove Libretti needs to make to build a sustainable competitive advantage.
