Vehbi KoA? and the Making of Turkey's Largest Business Group (B) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Vehbi KoA? and the Making of Turkey's Largest Business Group (B)
The case builds on the earlier A case which described the origins of the Turkish business group established by Vehbi KoA? before 1988. This case takes the story forward to 2012 as the KoA? group was led by Vehbi's son Rahmi followed by his grandson Mustafa. It explores both the professionalization of the management, and a radical restructuring of the business portfolio as the group refocused on five core sectors. The case also examines the start of the group's globalization strategy which was focused on the white goods affiliate ArA?elik.
Swot Analysis of "Vehbi KoA? and the Making of Turkey's Largest Business Group (B)" written by Asli M. Colpan, Geoffrey G. Jones includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Koa Vehbi facing as an external strategic factors. Some of the topics covered in Vehbi KoA? and the Making of Turkey's Largest Business Group (B) case study are - Strategic Management Strategies, Emerging markets, Entrepreneurship, Globalization, Marketing, Organizational structure, Risk management and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Vehbi KoA? and the Making of Turkey's Largest Business Group (B) casestudy better are - – challanges to central banks by blockchain based private currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, cloud computing is disrupting traditional business models, there is increasing trade war between United States & China, increasing energy prices, technology disruption, increasing inequality as vast percentage of new income is going to the top 1%,
increasing commodity prices, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of Vehbi KoA? and the Making of Turkey's Largest Business Group (B)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Vehbi KoA? and the Making of Turkey's Largest Business Group (B) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Koa Vehbi, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Koa Vehbi 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 Vehbi KoA? and the Making of Turkey's Largest Business Group (B) can be done for the following purposes –
1. Strategic planning using facts provided in Vehbi KoA? and the Making of Turkey's Largest Business Group (B) case study
2. Improving business portfolio management of Koa Vehbi
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 Koa Vehbi
Strengths Vehbi KoA? and the Making of Turkey's Largest Business Group (B) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Koa Vehbi in Vehbi KoA? and the Making of Turkey's Largest Business Group (B) Harvard Business Review case study are -
Analytics focus
– Koa Vehbi 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 Asli M. Colpan, Geoffrey G. Jones 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.
Successful track record of launching new products
– Koa Vehbi has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Koa Vehbi 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.
Low bargaining power of suppliers
– Suppliers of Koa Vehbi in the sector have low bargaining power. Vehbi KoA? and the Making of Turkey's Largest Business Group (B) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Koa Vehbi to manage not only supply disruptions but also source products at highly competitive prices.
Organizational Resilience of Koa Vehbi
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Koa Vehbi does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– Koa Vehbi has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Vehbi KoA? and the Making of Turkey's Largest Business Group (B) 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.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– Vehbi KoA? and the Making of Turkey's Largest Business Group (B) firm has clearly differentiated products in the market place. This has enabled Koa Vehbi to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Koa Vehbi to invest into research and development (R&D) and innovation.
Effective Research and Development (R&D)
– Koa Vehbi 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 Vehbi KoA? and the Making of Turkey's Largest Business Group (B) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Diverse revenue streams
– Koa Vehbi is present in almost all the verticals within the industry. This has provided firm in Vehbi KoA? and the Making of Turkey's Largest Business Group (B) 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.
Cross disciplinary teams
– Horizontal connected teams at the Koa Vehbi 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.
High brand equity
– Koa Vehbi has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Koa Vehbi to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to recruit top talent
– Koa Vehbi is one of the leading recruiters in the industry. Managers in the Vehbi KoA? and the Making of Turkey's Largest Business Group (B) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Innovation driven organization
– Koa Vehbi is one of the most innovative firm in sector. Manager in Vehbi KoA? and the Making of Turkey's Largest Business Group (B) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Weaknesses Vehbi KoA? and the Making of Turkey's Largest Business Group (B) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Vehbi KoA? and the Making of Turkey's Largest Business Group (B) are -
Products dominated business model
– Even though Koa Vehbi 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 - Vehbi KoA? and the Making of Turkey's Largest Business Group (B) should strive to include more intangible value offerings along with its core products and services.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Vehbi KoA? and the Making of Turkey's Largest Business Group (B), it seems that the employees of Koa Vehbi 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 Vehbi KoA? and the Making of Turkey's Largest Business Group (B) 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 Vehbi KoA? and the Making of Turkey's Largest Business Group (B) can leverage the sales team experience to cultivate customer relationships as Koa Vehbi is planning to shift buying processes online.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Vehbi KoA? and the Making of Turkey's Largest Business Group (B), is just above the industry average. Koa Vehbi 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Vehbi KoA? and the Making of Turkey's Largest Business Group (B) 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 Koa Vehbi 's lucrative customers.
Interest costs
– Compare to the competition, Koa Vehbi 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.
Low market penetration in new markets
– Outside its home market of Koa Vehbi, firm in the HBR case study Vehbi KoA? and the Making of Turkey's Largest Business Group (B) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Need for greater diversity
– Koa Vehbi 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 decision making process
– As mentioned earlier in the report, Koa Vehbi 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. Koa Vehbi 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.
Lack of clear differentiation of Koa Vehbi products
– To increase the profitability and margins on the products, Koa Vehbi needs to provide more differentiated products than what it is currently offering in the marketplace.
Increasing silos among functional specialists
– The organizational structure of Koa Vehbi is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Koa Vehbi needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Koa Vehbi to focus more on services rather than just following the product oriented approach.
Opportunities Vehbi KoA? and the Making of Turkey's Largest Business Group (B) | 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 Vehbi KoA? and the Making of Turkey's Largest Business Group (B) are -
Low interest rates
– Even though inflation is raising its head in most developed economies, Koa Vehbi 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.
Manufacturing automation
– Koa Vehbi 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.
Loyalty marketing
– Koa Vehbi 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.
Learning at scale
– Online learning technologies has now opened space for Koa Vehbi 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.
Creating value in data economy
– The success of analytics program of Koa Vehbi has opened avenues for new revenue streams for the organization in the industry. This can help Koa Vehbi to build a more holistic ecosystem as suggested in the Vehbi KoA? and the Making of Turkey's Largest Business Group (B) case study. Koa Vehbi can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Koa Vehbi 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.
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. Koa Vehbi can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Using analytics as competitive advantage
– Koa Vehbi 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 Vehbi KoA? and the Making of Turkey's Largest Business Group (B) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Koa Vehbi to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Better consumer reach
– The expansion of the 5G network will help Koa Vehbi to increase its market reach. Koa Vehbi 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 Koa Vehbi 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Koa Vehbi 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 Koa Vehbi to hire the very best people irrespective of their geographical location.
Leveraging digital technologies
– Koa Vehbi 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.
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. Koa Vehbi can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats Vehbi KoA? and the Making of Turkey's Largest Business Group (B) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Vehbi KoA? and the Making of Turkey's Largest Business Group (B) are -
Shortening product life cycle
– it is one of the major threat that Koa Vehbi is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing wage structure of Koa Vehbi
– 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 Koa Vehbi.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Koa Vehbi 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 Vehbi KoA? and the Making of Turkey's Largest Business Group (B) .
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
– Koa Vehbi 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.
Regulatory challenges
– Koa Vehbi 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
– Koa Vehbi 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.
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 Koa Vehbi in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
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. Koa Vehbi needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.
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 Koa Vehbi business can come under increasing regulations regarding data privacy, data security, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Koa Vehbi with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Vehbi KoA? and the Making of Turkey's Largest Business Group (B), Koa Vehbi 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 .
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 Koa Vehbi.
Weighted SWOT Analysis of Vehbi KoA? and the Making of Turkey's Largest Business Group (B) 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 Vehbi KoA? and the Making of Turkey's Largest Business Group (B) 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 Vehbi KoA? and the Making of Turkey's Largest Business Group (B) 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 Vehbi KoA? and the Making of Turkey's Largest Business Group (B) 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 Vehbi KoA? and the Making of Turkey's Largest Business Group (B) 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 Koa Vehbi needs to make to build a sustainable competitive advantage.
