Case Study Description of Nicole Alvino & Dermalounge
This case follows entrepreneur Nicole Alvino in the early days as she started a new company, dermalounge. Issues covered include building networks, writing a business plan, and fundraising.
Swot Analysis of "Nicole Alvino & Dermalounge" written by Garth Saloner, Jocelyn Hornblower includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Alvino Dermalounge facing as an external strategic factors. Some of the topics covered in Nicole Alvino & Dermalounge case study are - Strategic Management Strategies, Gender, Networking, Strategic planning and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Nicole Alvino & Dermalounge casestudy better are - – supply chains are disrupted by pandemic , wage bills are increasing, there is backlash against globalization, increasing inequality as vast percentage of new income is going to the top 1%, increasing energy prices, increasing transportation and logistics costs, increasing commodity prices,
geopolitical disruptions, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of Nicole Alvino & Dermalounge
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Nicole Alvino & Dermalounge case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Alvino Dermalounge, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Alvino Dermalounge 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 Nicole Alvino & Dermalounge can be done for the following purposes –
1. Strategic planning using facts provided in Nicole Alvino & Dermalounge case study
2. Improving business portfolio management of Alvino Dermalounge
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 Alvino Dermalounge
Strengths Nicole Alvino & Dermalounge | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Alvino Dermalounge in Nicole Alvino & Dermalounge Harvard Business Review case study are -
Strong track record of project management
– Alvino Dermalounge is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Organizational Resilience of Alvino Dermalounge
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Alvino Dermalounge does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High brand equity
– Alvino Dermalounge has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Alvino Dermalounge to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Cross disciplinary teams
– Horizontal connected teams at the Alvino Dermalounge 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.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– Nicole Alvino & Dermalounge firm has clearly differentiated products in the market place. This has enabled Alvino Dermalounge to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Alvino Dermalounge to invest into research and development (R&D) and innovation.
Operational resilience
– The operational resilience strategy in the Nicole Alvino & Dermalounge Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Highly skilled collaborators
– Alvino Dermalounge 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 Nicole Alvino & Dermalounge HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Learning organization
- Alvino Dermalounge 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 Alvino Dermalounge is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Nicole Alvino & Dermalounge Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Training and development
– Alvino Dermalounge has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Nicole Alvino & Dermalounge 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 recruit top talent
– Alvino Dermalounge is one of the leading recruiters in the industry. Managers in the Nicole Alvino & Dermalounge are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Ability to lead change in Innovation & Entrepreneurship field
– Alvino Dermalounge 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 Alvino Dermalounge in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Superior customer experience
– The customer experience strategy of Alvino Dermalounge in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses Nicole Alvino & Dermalounge | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Nicole Alvino & Dermalounge are -
Slow decision making process
– As mentioned earlier in the report, Alvino Dermalounge 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. Alvino Dermalounge 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Nicole Alvino & Dermalounge 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 Alvino Dermalounge has relatively successful track record of launching new products.
Interest costs
– Compare to the competition, Alvino Dermalounge 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.
Need for greater diversity
– Alvino Dermalounge 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Nicole Alvino & Dermalounge, is just above the industry average. Alvino Dermalounge 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.
Low market penetration in new markets
– Outside its home market of Alvino Dermalounge, firm in the HBR case study Nicole Alvino & Dermalounge needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to strategic competitive environment developments
– As Nicole Alvino & Dermalounge HBR case study mentions - Alvino Dermalounge 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.
Increasing silos among functional specialists
– The organizational structure of Alvino Dermalounge is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Alvino Dermalounge needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Alvino Dermalounge to focus more on services rather than just following the product oriented approach.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Nicole Alvino & Dermalounge, it seems that the employees of Alvino Dermalounge 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.
Aligning sales with marketing
– It come across in the case study Nicole Alvino & Dermalounge 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 Nicole Alvino & Dermalounge can leverage the sales team experience to cultivate customer relationships as Alvino Dermalounge is planning to shift buying processes online.
Lack of clear differentiation of Alvino Dermalounge products
– To increase the profitability and margins on the products, Alvino Dermalounge needs to provide more differentiated products than what it is currently offering in the marketplace.
Opportunities Nicole Alvino & Dermalounge | 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 Nicole Alvino & Dermalounge are -
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. Alvino Dermalounge 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. Alvino Dermalounge 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, Alvino Dermalounge is facing challenges because of the dominance of functional experts in the organization. Nicole Alvino & Dermalounge 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Alvino Dermalounge 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, Nicole Alvino & Dermalounge, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Leveraging digital technologies
– Alvino Dermalounge 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.
Buying journey improvements
– Alvino Dermalounge can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Nicole Alvino & Dermalounge 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.
Better consumer reach
– The expansion of the 5G network will help Alvino Dermalounge to increase its market reach. Alvino Dermalounge 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Alvino Dermalounge 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Alvino Dermalounge 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.
Learning at scale
– Online learning technologies has now opened space for Alvino Dermalounge 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.
Loyalty marketing
– Alvino Dermalounge 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.
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 Alvino Dermalounge 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Alvino Dermalounge can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Creating value in data economy
– The success of analytics program of Alvino Dermalounge has opened avenues for new revenue streams for the organization in the industry. This can help Alvino Dermalounge to build a more holistic ecosystem as suggested in the Nicole Alvino & Dermalounge case study. Alvino Dermalounge can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats Nicole Alvino & Dermalounge External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Nicole Alvino & Dermalounge are -
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 Alvino Dermalounge.
Environmental challenges
– Alvino Dermalounge 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. Alvino Dermalounge can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Alvino Dermalounge 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.
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. Alvino Dermalounge needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.
Increasing wage structure of Alvino Dermalounge
– 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 Alvino Dermalounge.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Alvino Dermalounge 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 Nicole Alvino & Dermalounge .
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 Alvino Dermalounge business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Alvino Dermalounge 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 Alvino Dermalounge with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
Consumer confidence and its impact on Alvino Dermalounge 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.
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 Alvino Dermalounge in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
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.
Weighted SWOT Analysis of Nicole Alvino & Dermalounge 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 Nicole Alvino & Dermalounge 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 Nicole Alvino & Dermalounge 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 Nicole Alvino & Dermalounge 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 Nicole Alvino & Dermalounge 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 Alvino Dermalounge needs to make to build a sustainable competitive advantage.