Esquel Group: Integrating Business Strategy and Corporate Social Responsibility SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Esquel Group: Integrating Business Strategy and Corporate Social Responsibility
Focuses on the experience of China's largest shirt manufacturer in managing various aspects of government relations in China. Identifies a wide variety of social initiatives it has undertaken.
Authors :: F. Warren McFarlan, William C. Kirby, Tracy Yuen Manty
Swot Analysis of "Esquel Group: Integrating Business Strategy and Corporate Social Responsibility" written by F. Warren McFarlan, William C. Kirby, Tracy Yuen Manty includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Esquel Shirt facing as an external strategic factors. Some of the topics covered in Esquel Group: Integrating Business Strategy and Corporate Social Responsibility case study are - Strategic Management Strategies, Government, Social responsibility and Global Business.
Some of the macro environment factors that can be used to understand the Esquel Group: Integrating Business Strategy and Corporate Social Responsibility casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, increasing commodity prices, there is increasing trade war between United States & China, talent flight as more people leaving formal jobs, wage bills are increasing, central banks are concerned over increasing inflation, customer relationship management is fast transforming because of increasing concerns over data privacy,
increasing energy prices, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of Esquel Group: Integrating Business Strategy and Corporate Social Responsibility
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Esquel Group: Integrating Business Strategy and Corporate Social Responsibility case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Esquel Shirt, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Esquel Shirt 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 Esquel Group: Integrating Business Strategy and Corporate Social Responsibility can be done for the following purposes –
1. Strategic planning using facts provided in Esquel Group: Integrating Business Strategy and Corporate Social Responsibility case study
2. Improving business portfolio management of Esquel Shirt
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 Esquel Shirt
Strengths Esquel Group: Integrating Business Strategy and Corporate Social Responsibility | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Esquel Shirt in Esquel Group: Integrating Business Strategy and Corporate Social Responsibility Harvard Business Review case study are -
Diverse revenue streams
– Esquel Shirt is present in almost all the verticals within the industry. This has provided firm in Esquel Group: Integrating Business Strategy and Corporate Social Responsibility 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 recruit top talent
– Esquel Shirt is one of the leading recruiters in the industry. Managers in the Esquel Group: Integrating Business Strategy and Corporate Social Responsibility are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Low bargaining power of suppliers
– Suppliers of Esquel Shirt in the sector have low bargaining power. Esquel Group: Integrating Business Strategy and Corporate Social Responsibility has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Esquel Shirt to manage not only supply disruptions but also source products at highly competitive prices.
Cross disciplinary teams
– Horizontal connected teams at the Esquel Shirt 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.
Training and development
– Esquel Shirt has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Esquel Group: Integrating Business Strategy and Corporate Social Responsibility 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.
Ability to lead change in Global Business field
– Esquel Shirt 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 Esquel Shirt in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Sustainable margins compare to other players in Global Business industry
– Esquel Group: Integrating Business Strategy and Corporate Social Responsibility firm has clearly differentiated products in the market place. This has enabled Esquel Shirt to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Esquel Shirt to invest into research and development (R&D) and innovation.
High brand equity
– Esquel Shirt has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Esquel Shirt to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Strong track record of project management
– Esquel Shirt is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Innovation driven organization
– Esquel Shirt is one of the most innovative firm in sector. Manager in Esquel Group: Integrating Business Strategy and Corporate Social Responsibility Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Analytics focus
– Esquel Shirt 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 F. Warren McFarlan, William C. Kirby, Tracy Yuen Manty 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.
Organizational Resilience of Esquel Shirt
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Esquel Shirt does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses Esquel Group: Integrating Business Strategy and Corporate Social Responsibility | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Esquel Group: Integrating Business Strategy and Corporate Social Responsibility are -
No frontier risks strategy
– After analyzing the HBR case study Esquel Group: Integrating Business Strategy and Corporate Social Responsibility, 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Esquel Shirt 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.
Aligning sales with marketing
– It come across in the case study Esquel Group: Integrating Business Strategy and Corporate Social Responsibility 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 Esquel Group: Integrating Business Strategy and Corporate Social Responsibility can leverage the sales team experience to cultivate customer relationships as Esquel Shirt is planning to shift buying processes online.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Esquel Group: Integrating Business Strategy and Corporate Social Responsibility, it seems that the employees of Esquel Shirt 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Esquel Group: Integrating Business Strategy and Corporate Social Responsibility 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 Esquel Shirt 's lucrative customers.
Products dominated business model
– Even though Esquel Shirt has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Esquel Group: Integrating Business Strategy and Corporate Social Responsibility should strive to include more intangible value offerings along with its core products and services.
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 Esquel Shirt supply chain. Even after few cautionary changes mentioned in the HBR case study - Esquel Group: Integrating Business Strategy and Corporate Social Responsibility, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Esquel Shirt vulnerable to further global disruptions in South East Asia.
Capital Spending Reduction
– Even during the low interest decade, Esquel Shirt 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.
Slow to strategic competitive environment developments
– As Esquel Group: Integrating Business Strategy and Corporate Social Responsibility HBR case study mentions - Esquel Shirt 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Esquel Group: Integrating Business Strategy and Corporate Social Responsibility 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 Esquel Shirt has relatively successful track record of launching new products.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Esquel Shirt is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Esquel Group: Integrating Business Strategy and Corporate Social Responsibility can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities Esquel Group: Integrating Business Strategy and Corporate Social Responsibility | 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 Esquel Group: Integrating Business Strategy and Corporate Social Responsibility are -
Creating value in data economy
– The success of analytics program of Esquel Shirt has opened avenues for new revenue streams for the organization in the industry. This can help Esquel Shirt to build a more holistic ecosystem as suggested in the Esquel Group: Integrating Business Strategy and Corporate Social Responsibility case study. Esquel Shirt can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Esquel Shirt can use these opportunities to build new business models that can help the communities that Esquel Shirt operates in. Secondly it can use opportunities from government spending in Global Business sector.
Manufacturing automation
– Esquel Shirt 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 Esquel Shirt 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 Esquel Shirt to hire the very best people irrespective of their geographical location.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Esquel Shirt can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Esquel Group: Integrating Business Strategy and Corporate Social Responsibility, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Esquel Shirt 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, Esquel Shirt 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Esquel Shirt 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 Esquel Shirt in the consumer business. Now Esquel Shirt can target international markets with far fewer capital restrictions requirements than the existing system.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Esquel Shirt 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.
Loyalty marketing
– Esquel Shirt 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.
Using analytics as competitive advantage
– Esquel Shirt 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 Esquel Group: Integrating Business Strategy and Corporate Social Responsibility - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Esquel Shirt to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Leveraging digital technologies
– Esquel Shirt 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.
Threats Esquel Group: Integrating Business Strategy and Corporate Social Responsibility External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Esquel Group: Integrating Business Strategy and Corporate Social Responsibility are -
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. Esquel Shirt needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Esquel Shirt 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 Esquel Group: Integrating Business Strategy and Corporate Social Responsibility .
Consumer confidence and its impact on Esquel Shirt 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.
High dependence on third party suppliers
– Esquel Shirt 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Esquel Shirt 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.
Increasing wage structure of Esquel Shirt
– 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 Esquel Shirt.
Shortening product life cycle
– it is one of the major threat that Esquel Shirt is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Esquel Shirt business can come under increasing regulations regarding data privacy, data security, etc.
Environmental challenges
– Esquel Shirt 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. Esquel Shirt can take advantage of this fund but it will also bring new competitors in the Global Business industry.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Esquel Group: Integrating Business Strategy and Corporate Social Responsibility, Esquel Shirt 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 .
Stagnating economy with rate increase
– Esquel Shirt 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.
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. Esquel Shirt can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of Esquel Group: Integrating Business Strategy and Corporate Social Responsibility 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 Esquel Group: Integrating Business Strategy and Corporate Social Responsibility 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 Esquel Group: Integrating Business Strategy and Corporate Social Responsibility 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 Esquel Group: Integrating Business Strategy and Corporate Social Responsibility 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 Esquel Group: Integrating Business Strategy and Corporate Social Responsibility 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 Esquel Shirt needs to make to build a sustainable competitive advantage.
