Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door
Ben Cohen and Jerry Greenfield were best friends and socially conscious entrepreneurs when they founded Ben & Jerry's Homemade in the 1970s in Burlington, Vermont. The company was well-known for being offbeat, quirky, and committed to socially responsible ventures and using organic ingredients in its products. When the company went public in 1984, most people bought the stock because they believed in the company's values and mission. In late 1999, the financial and economic world was quite different, and two suitors-Unilever and Dreyer's Ice Cream-appeared, both very interested in acquiring Ben & Jerry's. This case describes not only the background and history of Ben & Jerry's, but the factors involved in the founders' having to decide what course of action to take.
Authors :: Robert J. Sack, Pat Werhane, Jenny Mead
Swot Analysis of "Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door" written by Robert J. Sack, Pat Werhane, Jenny Mead includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Ben Jerry's facing as an external strategic factors. Some of the topics covered in Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door case study are - Strategic Management Strategies, Corporate governance, Financial markets, Growth strategy, Mergers & acquisitions, Negotiations, Public relations, Social responsibility and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door casestudy better are - – increasing household debt because of falling income levels, cloud computing is disrupting traditional business models, increasing energy prices, increasing transportation and logistics costs, increasing inequality as vast percentage of new income is going to the top 1%, talent flight as more people leaving formal jobs, increasing commodity prices,
competitive advantages are harder to sustain because of technology dispersion, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Ben Jerry's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Ben Jerry's 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 Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door can be done for the following purposes –
1. Strategic planning using facts provided in Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door case study
2. Improving business portfolio management of Ben Jerry's
3. Assessing feasibility of the new initiative in Innovation & Entrepreneurship field.
4. Making a Innovation & Entrepreneurship topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Ben Jerry's
Strengths Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Ben Jerry's in Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door Harvard Business Review case study are -
Highly skilled collaborators
– Ben Jerry's 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 Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High brand equity
– Ben Jerry's has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Ben Jerry's to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to recruit top talent
– Ben Jerry's is one of the leading recruiters in the industry. Managers in the Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Strong track record of project management
– Ben Jerry's is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to lead change in Innovation & Entrepreneurship field
– Ben Jerry's 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 Ben Jerry's in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Low bargaining power of suppliers
– Suppliers of Ben Jerry's in the sector have low bargaining power. Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Ben Jerry's to manage not only supply disruptions but also source products at highly competitive prices.
Operational resilience
– The operational resilience strategy in the Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door 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.
Effective Research and Development (R&D)
– Ben Jerry's 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 Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door - 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 Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Ben Jerry's digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Ben Jerry's 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.
Successful track record of launching new products
– Ben Jerry's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Ben Jerry's 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.
Training and development
– Ben Jerry's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door 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.
Analytics focus
– Ben Jerry's 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 Robert J. Sack, Pat Werhane, Jenny Mead 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.
Weaknesses Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door are -
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door, is just above the industry average. Ben Jerry's 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Ben Jerry's 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door 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 Ben Jerry's 's lucrative customers.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door 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 Ben Jerry's has relatively successful track record of launching new products.
Aligning sales with marketing
– It come across in the case study Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door 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 Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door can leverage the sales team experience to cultivate customer relationships as Ben Jerry's is planning to shift buying processes online.
Increasing silos among functional specialists
– The organizational structure of Ben Jerry's is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Ben Jerry's needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Ben Jerry's to focus more on services rather than just following the product oriented approach.
Need for greater diversity
– Ben Jerry's 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.
Capital Spending Reduction
– Even during the low interest decade, Ben Jerry's has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
High dependence on 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 Ben Jerry's supply chain. Even after few cautionary changes mentioned in the HBR case study - Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Ben Jerry's vulnerable to further global disruptions in South East Asia.
High bargaining power of channel partners
– Because of the regulatory requirements, Robert J. Sack, Pat Werhane, Jenny Mead suggests that, Ben Jerry's 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Ben Jerry's is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door 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 Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door | 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 Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door are -
Loyalty marketing
– Ben Jerry's 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Ben Jerry's in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Innovation & Entrepreneurship segment, and it will provide faster access to the consumers.
Creating value in data economy
– The success of analytics program of Ben Jerry's has opened avenues for new revenue streams for the organization in the industry. This can help Ben Jerry's to build a more holistic ecosystem as suggested in the Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door case study. Ben Jerry's can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Developing new processes and practices
– Ben Jerry's can develop new processes and procedures in Innovation & Entrepreneurship 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.
Better consumer reach
– The expansion of the 5G network will help Ben Jerry's to increase its market reach. Ben Jerry's 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Ben Jerry's can use these opportunities to build new business models that can help the communities that Ben Jerry's operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Innovation & Entrepreneurship industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Ben Jerry's 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. Ben Jerry's 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Ben Jerry's 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 Ben Jerry's to hire the very best people irrespective of their geographical location.
Leveraging digital technologies
– Ben Jerry's 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.
Manufacturing automation
– Ben Jerry's can use the latest technology developments to improve its manufacturing and designing process in Innovation & Entrepreneurship 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Ben Jerry's can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Ben Jerry's 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Ben Jerry's 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.
Threats Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door are -
Shortening product life cycle
– it is one of the major threat that Ben Jerry's is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Environmental challenges
– Ben Jerry's 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. Ben Jerry's can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
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 Ben Jerry's.
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 Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door, Ben Jerry's may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Innovation & Entrepreneurship .
Regulatory challenges
– Ben Jerry's 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 Innovation & Entrepreneurship industry regulations.
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
– Ben Jerry's 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.
Increasing wage structure of Ben Jerry's
– 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 Ben Jerry's.
High dependence on third party suppliers
– Ben Jerry's 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 Ben Jerry's in the Innovation & Entrepreneurship industry. The Innovation & Entrepreneurship 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.
Technology acceleration in Forth Industrial Revolution
– Ben Jerry's has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Ben Jerry's needs to keep up with the evolution of technology in the Innovation & Entrepreneurship 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 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. Ben Jerry's needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.
Weighted SWOT Analysis of Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door 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 Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door 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 Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door 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 Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door 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 Ben & Jerry's Homemade, Inc. (A): Acquisition Suitors at the Door 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 Ben Jerry's needs to make to build a sustainable competitive advantage.