Case Study Description of Creating Revenue Streams for VOSS
In 2010, the recently appointed chief executive officer of VOSS Water (VOSS), a Norwegian luxury bottled water company, had been given an opportunity to take the brand in a new direction. He knew that take-home retail markets represented a huge opportunity for growth for a company that was used to selling its water in on-premises, luxury locations such as resorts and restaurants; however, the company's past attempts to grow into the retail space had produced dismal results. VOSS's new leader understood that he would have to work hard to unite his team behind his vision. How could he learn from the steps of his predecessors and use hindsight to create an opportunity for the luxury water brand? Mona Anita K. Olsen is affiliated with Cornell University.
Authors :: Mona Anita K. Olsen, Katie Chan, Johnny VanCora
Swot Analysis of "Creating Revenue Streams for VOSS" written by Mona Anita K. Olsen, Katie Chan, Johnny VanCora includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Voss Water facing as an external strategic factors. Some of the topics covered in Creating Revenue Streams for VOSS case study are - Strategic Management Strategies, Business models, Innovation and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Creating Revenue Streams for VOSS casestudy better are - – cloud computing is disrupting traditional business models, central banks are concerned over increasing inflation, customer relationship management is fast transforming because of increasing concerns over data privacy, there is backlash against globalization, digital marketing is dominated by two big players Facebook and Google, competitive advantages are harder to sustain because of technology dispersion, increasing transportation and logistics costs,
supply chains are disrupted by pandemic , geopolitical disruptions, etc
Introduction to SWOT Analysis of Creating Revenue Streams for VOSS
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Creating Revenue Streams for VOSS case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Voss Water, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Voss Water 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 Creating Revenue Streams for VOSS can be done for the following purposes –
1. Strategic planning using facts provided in Creating Revenue Streams for VOSS case study
2. Improving business portfolio management of Voss Water
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 Voss Water
Strengths Creating Revenue Streams for VOSS | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Voss Water in Creating Revenue Streams for VOSS Harvard Business Review case study are -
Effective Research and Development (R&D)
– Voss Water 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 Creating Revenue Streams for VOSS - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Organizational Resilience of Voss Water
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Voss Water does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Low bargaining power of suppliers
– Suppliers of Voss Water in the sector have low bargaining power. Creating Revenue Streams for VOSS has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Voss Water to manage not only supply disruptions but also source products at highly competitive prices.
Learning organization
- Voss Water 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 Voss Water is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Creating Revenue Streams for VOSS Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Operational resilience
– The operational resilience strategy in the Creating Revenue Streams for VOSS 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 Voss Water 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
– Creating Revenue Streams for VOSS firm has clearly differentiated products in the market place. This has enabled Voss Water to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Voss Water to invest into research and development (R&D) and innovation.
Analytics focus
– Voss Water 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 Mona Anita K. Olsen, Katie Chan, Johnny VanCora can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Strong track record of project management
– Voss Water 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
– Voss Water 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 Voss Water in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High brand equity
– Voss Water has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Voss Water to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– Voss Water is one of the most innovative firm in sector. Manager in Creating Revenue Streams for VOSS Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Weaknesses Creating Revenue Streams for VOSS | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Creating Revenue Streams for VOSS are -
High bargaining power of channel partners
– Because of the regulatory requirements, Mona Anita K. Olsen, Katie Chan, Johnny VanCora suggests that, Voss Water 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, Voss Water is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Creating Revenue Streams for VOSS can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
No frontier risks strategy
– After analyzing the HBR case study Creating Revenue Streams for VOSS, 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Creating Revenue Streams for VOSS 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 Voss Water has relatively successful track record of launching new products.
Slow to strategic competitive environment developments
– As Creating Revenue Streams for VOSS HBR case study mentions - Voss Water 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Creating Revenue Streams for VOSS, it seems that the employees of Voss Water 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.
Increasing silos among functional specialists
– The organizational structure of Voss Water is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Voss Water needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Voss Water to focus more on services rather than just following the product oriented approach.
Need for greater diversity
– Voss Water 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.
Skills based hiring
– The stress on hiring functional specialists at Voss Water has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Aligning sales with marketing
– It come across in the case study Creating Revenue Streams for VOSS 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 Creating Revenue Streams for VOSS can leverage the sales team experience to cultivate customer relationships as Voss Water is planning to shift buying processes online.
Capital Spending Reduction
– Even during the low interest decade, Voss Water 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.
Opportunities Creating Revenue Streams for VOSS | 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 Creating Revenue Streams for VOSS are -
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 Voss Water 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.
Using analytics as competitive advantage
– Voss Water 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 Creating Revenue Streams for VOSS - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Voss Water to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Voss Water 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 Voss Water to hire the very best people irrespective of their geographical location.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Voss Water 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.
Buying journey improvements
– Voss Water can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Creating Revenue Streams for VOSS 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Voss Water 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Voss Water can use these opportunities to build new business models that can help the communities that Voss Water operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Creating value in data economy
– The success of analytics program of Voss Water has opened avenues for new revenue streams for the organization in the industry. This can help Voss Water to build a more holistic ecosystem as suggested in the Creating Revenue Streams for VOSS case study. Voss Water can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
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 Voss Water in the consumer business. Now Voss Water can target international markets with far fewer capital restrictions requirements than the existing system.
Learning at scale
– Online learning technologies has now opened space for Voss Water 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.
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. Voss Water can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Loyalty marketing
– Voss Water 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.
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. Voss Water can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats Creating Revenue Streams for VOSS External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Creating Revenue Streams for VOSS are -
Increasing wage structure of Voss Water
– 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 Voss Water.
Stagnating economy with rate increase
– Voss Water 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.
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 Voss Water.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Voss Water 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 Voss Water 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Voss Water 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. Voss Water needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.
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.
Regulatory challenges
– Voss Water 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.
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 Voss Water in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Voss Water 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.
Shortening product life cycle
– it is one of the major threat that Voss Water 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.
Weighted SWOT Analysis of Creating Revenue Streams for VOSS 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 Creating Revenue Streams for VOSS 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 Creating Revenue Streams for VOSS 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 Creating Revenue Streams for VOSS 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 Creating Revenue Streams for VOSS 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 Voss Water needs to make to build a sustainable competitive advantage.