Sugar Daddy: Quotas and the U.S. Government SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Sugar Daddy: Quotas and the U.S. Government
Since 1981, the U.S. federal government has operated a price support program to help sugar beet and sugar cane producers and processors. This complex program works through a combination of loans, import quotas, and duties. As a result, sugar prices in the United States are significantly higher than world prices. For example, in December 2001, U.S. consumers paid 22.9 cents per pound, while the world price was just 9 cents per pound. The General Accounting Office estimates that the total cost to consumers is $1.9 billion a year. Uses a simple demand-and-supply framework with real-world data to assess the economic and political consequences of the U.S. sugar program.
Authors :: Nabil Al-Najjar, Sandeep Baliga, Chris Forman
Swot Analysis of "Sugar Daddy: Quotas and the U.S. Government" written by Nabil Al-Najjar, Sandeep Baliga, Chris Forman includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Sugar Quotas facing as an external strategic factors. Some of the topics covered in Sugar Daddy: Quotas and the U.S. Government case study are - Strategic Management Strategies, Globalization, Policy, Pricing and Global Business.
Some of the macro environment factors that can be used to understand the Sugar Daddy: Quotas and the U.S. Government casestudy better are - – cloud computing is disrupting traditional business models, competitive advantages are harder to sustain because of technology dispersion, banking and financial system is disrupted by Bitcoin and other crypto currencies, supply chains are disrupted by pandemic , increasing inequality as vast percentage of new income is going to the top 1%, increasing government debt because of Covid-19 spendings, challanges to central banks by blockchain based private currencies,
increasing commodity prices, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of Sugar Daddy: Quotas and the U.S. Government
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Sugar Daddy: Quotas and the U.S. Government case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Sugar Quotas, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Sugar Quotas 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 Sugar Daddy: Quotas and the U.S. Government can be done for the following purposes –
1. Strategic planning using facts provided in Sugar Daddy: Quotas and the U.S. Government case study
2. Improving business portfolio management of Sugar Quotas
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 Sugar Quotas
Strengths Sugar Daddy: Quotas and the U.S. Government | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Sugar Quotas in Sugar Daddy: Quotas and the U.S. Government Harvard Business Review case study are -
High brand equity
– Sugar Quotas has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Sugar Quotas to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Cross disciplinary teams
– Horizontal connected teams at the Sugar Quotas 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.
Low bargaining power of suppliers
– Suppliers of Sugar Quotas in the sector have low bargaining power. Sugar Daddy: Quotas and the U.S. Government has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Sugar Quotas to manage not only supply disruptions but also source products at highly competitive prices.
Organizational Resilience of Sugar Quotas
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Sugar Quotas does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Sugar Quotas is one of the leading recruiters in the industry. Managers in the Sugar Daddy: Quotas and the U.S. Government are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Analytics focus
– Sugar Quotas 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 Nabil Al-Najjar, Sandeep Baliga, Chris Forman 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.
Strong track record of project management
– Sugar Quotas is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Operational resilience
– The operational resilience strategy in the Sugar Daddy: Quotas and the U.S. Government 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
- Sugar Quotas 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 Sugar Quotas is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Sugar Daddy: Quotas and the U.S. Government Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– Sugar Quotas is one of the most innovative firm in sector. Manager in Sugar Daddy: Quotas and the U.S. Government Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Successful track record of launching new products
– Sugar Quotas has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Sugar Quotas 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.
Diverse revenue streams
– Sugar Quotas is present in almost all the verticals within the industry. This has provided firm in Sugar Daddy: Quotas and the U.S. Government 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.
Weaknesses Sugar Daddy: Quotas and the U.S. Government | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Sugar Daddy: Quotas and the U.S. Government are -
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Sugar Daddy: Quotas and the U.S. Government, it seems that the employees of Sugar Quotas 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 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 Sugar Quotas supply chain. Even after few cautionary changes mentioned in the HBR case study - Sugar Daddy: Quotas and the U.S. Government, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Sugar Quotas vulnerable to further global disruptions in South East Asia.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Sugar Daddy: Quotas and the U.S. Government 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 Sugar Quotas has relatively successful track record of launching new products.
Products dominated business model
– Even though Sugar Quotas 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 - Sugar Daddy: Quotas and the U.S. Government should strive to include more intangible value offerings along with its core products and services.
High cash cycle compare to competitors
Sugar Quotas 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.
Slow decision making process
– As mentioned earlier in the report, Sugar Quotas 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. Sugar Quotas 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.
Increasing silos among functional specialists
– The organizational structure of Sugar Quotas is dominated by functional specialists. It is not different from other players in the Global Business segment. Sugar Quotas needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Sugar Quotas to focus more on services rather than just following the product oriented approach.
High bargaining power of channel partners
– Because of the regulatory requirements, Nabil Al-Najjar, Sandeep Baliga, Chris Forman suggests that, Sugar Quotas 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.
Lack of clear differentiation of Sugar Quotas products
– To increase the profitability and margins on the products, Sugar Quotas needs to provide more differentiated products than what it is currently offering in the marketplace.
Need for greater diversity
– Sugar Quotas 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Sugar Quotas is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Sugar Daddy: Quotas and the U.S. Government 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 Sugar Daddy: Quotas and the U.S. Government | 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 Sugar Daddy: Quotas and the U.S. Government are -
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 Sugar Quotas in the consumer business. Now Sugar Quotas can target international markets with far fewer capital restrictions requirements than the existing system.
Buying journey improvements
– Sugar Quotas can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Sugar Daddy: Quotas and the U.S. Government 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Sugar Quotas 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Sugar Quotas 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.
Better consumer reach
– The expansion of the 5G network will help Sugar Quotas to increase its market reach. Sugar Quotas 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.
Building a culture of innovation
– managers at Sugar Quotas 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.
Developing new processes and practices
– Sugar Quotas 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.
Manufacturing automation
– Sugar Quotas 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. Sugar Quotas 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. Sugar Quotas 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Sugar Quotas is facing challenges because of the dominance of functional experts in the organization. Sugar Daddy: Quotas and the U.S. Government 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.
Using analytics as competitive advantage
– Sugar Quotas 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 Sugar Daddy: Quotas and the U.S. Government - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Sugar Quotas to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Loyalty marketing
– Sugar Quotas 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Sugar Quotas can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Sugar Daddy: Quotas and the U.S. Government External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Sugar Daddy: Quotas and the U.S. Government are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Sugar Quotas 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 Sugar Daddy: Quotas and the U.S. Government .
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Sugar Daddy: Quotas and the U.S. Government, Sugar Quotas 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.
Consumer confidence and its impact on Sugar Quotas 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 acceleration in Forth Industrial Revolution
– Sugar Quotas has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Sugar Quotas 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.
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.
Stagnating economy with rate increase
– Sugar Quotas 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Sugar Quotas 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.
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. Sugar Quotas can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing wage structure of Sugar Quotas
– 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 Sugar Quotas.
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 Sugar Quotas in the Global Business sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Sugar Quotas 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Sugar Quotas with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Weighted SWOT Analysis of Sugar Daddy: Quotas and the U.S. Government 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 Sugar Daddy: Quotas and the U.S. Government 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 Sugar Daddy: Quotas and the U.S. Government 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 Sugar Daddy: Quotas and the U.S. Government 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 Sugar Daddy: Quotas and the U.S. Government 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 Sugar Quotas needs to make to build a sustainable competitive advantage.