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 - – talent flight as more people leaving formal jobs, challanges to central banks by blockchain based private currencies, increasing transportation and logistics costs, increasing energy prices, central banks are concerned over increasing inflation, competitive advantages are harder to sustain because of technology dispersion, banking and financial system is disrupted by Bitcoin and other crypto currencies,
increasing household debt because of falling income levels, customer relationship management is fast transforming because of increasing concerns over data privacy, 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 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.
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.
Organizational Resilience of Kaira Union
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Kaira Union does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
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.
Learning organization
- Kaira Union 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 Kaira Union is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Amul's IT-Enabled Service Delivery to Dairy Farmers Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
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.
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.
Strong track record of project management
– Kaira Union is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
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 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.
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.
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 -
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.
Slow decision making process
– As mentioned earlier in the report, Kaira Union 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. Kaira Union 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.
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.
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 bargaining power of channel partners
– Because of the regulatory requirements, Harekrishna Misra, S.R. Asokan suggests that, Kaira Union 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 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.
Interest costs
– Compare to the competition, Kaira Union 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.
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.
Need for greater diversity
– Kaira Union 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.
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.
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.
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 -
Leveraging digital technologies
– Kaira Union 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.
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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Kaira Union can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
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.
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.
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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Kaira Union 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 Kaira Union to hire the very best people irrespective of their geographical location.
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.
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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Kaira Union can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Kaira Union in the consumer business. Now Kaira Union can target international markets with far fewer capital restrictions requirements than the existing system.
Loyalty marketing
– Kaira Union 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.
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 -
High dependence on third party suppliers
– Kaira Union 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.
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.
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.
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.
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.
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Kaira Union 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 Amul's IT-Enabled Service Delivery to Dairy Farmers .
Regulatory challenges
– Kaira Union 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.
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 .
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.
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.
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.
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 Kaira Union.
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.
