From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China
In 1985, Don St. Pierre Sr. became President of Beijing Jeep, the troubled joint venture between American Motor Corporation and the Chinese government to build Jeep Cherokees in China. Just over a decade later in 1996, leveraging contacts from his time in the automotive industry, he founded ASC Fine Wines with his son, Don Jr. Despite many challenges, from building a distribution network from the ground up to Chinese Customs throwing Don Jr. in prison, the St. Pierres prevailed, and ASC was standing tall as China's number-one fine wine importer by volume and value in 2013. ASC had developed a reputation for quality of product and service, beating out the competition of private wine importers and state-owned enterprises. What lessons had this father-son team learned in their 20 years of doing business in China? Would ASC make the transition from being a family-run business to a part of Suntory Holdings and still thrive? Could ASC under its leadership continue to adapt to the changing market for fine wine in China?
Swot Analysis of "From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China" written by William C. Kirby, Erica M Zendell includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Asc Jeep facing as an external strategic factors. Some of the topics covered in From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China case study are - Strategic Management Strategies, Entrepreneurship, Globalization, Government, Joint ventures, Manufacturing and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China casestudy better are - – central banks are concerned over increasing inflation, increasing government debt because of Covid-19 spendings, there is increasing trade war between United States & China, there is backlash against globalization, increasing commodity prices, banking and financial system is disrupted by Bitcoin and other crypto currencies, supply chains are disrupted by pandemic ,
talent flight as more people leaving formal jobs, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Asc Jeep, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Asc Jeep 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 From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China can be done for the following purposes –
1. Strategic planning using facts provided in From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China case study
2. Improving business portfolio management of Asc Jeep
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 Asc Jeep
Strengths From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Asc Jeep in From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China Harvard Business Review case study are -
High switching costs
– The high switching costs that Asc Jeep 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.
Superior customer experience
– The customer experience strategy of Asc Jeep in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to lead change in Innovation & Entrepreneurship field
– Asc Jeep 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 Asc Jeep in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Learning organization
- Asc Jeep 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 Asc Jeep is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Digital Transformation in Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Asc Jeep digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Asc Jeep 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.
Operational resilience
– The operational resilience strategy in the From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China 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.
Cross disciplinary teams
– Horizontal connected teams at the Asc Jeep 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.
Highly skilled collaborators
– Asc Jeep 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 From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Analytics focus
– Asc Jeep 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 William C. Kirby, Erica M Zendell 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 Asc Jeep
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Asc Jeep does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Asc Jeep is one of the leading recruiters in the industry. Managers in the From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China 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
– Asc Jeep is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China are -
Capital Spending Reduction
– Even during the low interest decade, Asc Jeep 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.
No frontier risks strategy
– After analyzing the HBR case study From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China, it seems that company is thinking about the frontier risks that can impact Innovation & Entrepreneurship 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China, it seems that the employees of Asc Jeep 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.
Low market penetration in new markets
– Outside its home market of Asc Jeep, firm in the HBR case study From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to strategic competitive environment developments
– As From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China HBR case study mentions - Asc Jeep 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.
Aligning sales with marketing
– It come across in the case study From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China 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 From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China can leverage the sales team experience to cultivate customer relationships as Asc Jeep is planning to shift buying processes online.
High bargaining power of channel partners
– Because of the regulatory requirements, William C. Kirby, Erica M Zendell suggests that, Asc Jeep 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China, in the dynamic environment Asc Jeep has struggled to respond to the nimble upstart competition. Asc Jeep has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Interest costs
– Compare to the competition, Asc Jeep 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Asc Jeep 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 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 Asc Jeep supply chain. Even after few cautionary changes mentioned in the HBR case study - From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Asc Jeep vulnerable to further global disruptions in South East Asia.
Opportunities From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China | 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 From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China are -
Using analytics as competitive advantage
– Asc Jeep 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 From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Asc Jeep to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Building a culture of innovation
– managers at Asc Jeep 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 Innovation & Entrepreneurship segment.
Learning at scale
– Online learning technologies has now opened space for Asc Jeep to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Manufacturing automation
– Asc Jeep 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.
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 Asc Jeep 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.
Developing new processes and practices
– Asc Jeep 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Asc Jeep can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Asc Jeep 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. Asc Jeep 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.
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 Asc Jeep in the consumer business. Now Asc Jeep can target international markets with far fewer capital restrictions requirements than the existing system.
Low interest rates
– Even though inflation is raising its head in most developed economies, Asc Jeep 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Innovation & Entrepreneurship industry, but it has also influenced the consumer preferences. Asc Jeep can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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. Asc Jeep can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Asc Jeep can use these opportunities to build new business models that can help the communities that Asc Jeep operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Threats From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China are -
Increasing wage structure of Asc Jeep
– 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 Asc Jeep.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China, Asc Jeep 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
– Asc Jeep 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.
High dependence on third party suppliers
– Asc Jeep 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 Asc Jeep 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Asc Jeep with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Consumer confidence and its impact on Asc Jeep 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.
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 Asc Jeep business can come under increasing regulations regarding data privacy, data security, etc.
Shortening product life cycle
– it is one of the major threat that Asc Jeep is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Asc Jeep will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Easy access to finance
– Easy access to finance in Innovation & Entrepreneurship field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Asc Jeep can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Environmental challenges
– Asc Jeep 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. Asc Jeep can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
Weighted SWOT Analysis of From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China 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 From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China 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 From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China 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 From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China 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 From Beijing Jeep to ASC Fine Wines: The Story of an American Family Business in China 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 Asc Jeep needs to make to build a sustainable competitive advantage.
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