Runa: Driving Social Change through Passion and Profit SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Runa: Driving Social Change through Passion and Profit
Near the end of 2008, Tyler Gage and Dan MacCombie enrolled in an entrepreneurship course at Brown University. During the class, they refined the business plan for Runa, a beverage company that would make drinks from guayusa, a little-known leaf that grew in the Amazon. Beyond the potential of the business to make money, the two believed in Runa's social missiona??respecting the cultural traditions of Ecuadorian Kichwa communities, providing sustainable income streams to small farmers, and helping the Amazon rainforest thrive. Just months after delivering their final classroom presentation for Runa, Gage and MacCombie found themselves in Ecuador, pursuing the idea full time. "Runa: Driving Social Change through Passion and Profit" explores Gage and MacCombie's journey from class project to a fast-growing start-up. More specifically, the case explores the myriad challenges Gage and MacCombie faced in building Runa: raising money to launch the venture; establishing successful partnerships and overcoming deep-seated skepticism among Ecuadorian communities; building a supply chain from scratch; developing a successful go-to-market strategy; and maintaining their focus on social impact while simultaneously generating financial returns.
Swot Analysis of "Runa: Driving Social Change through Passion and Profit" written by Laura Hattendorf, Ryan Kissick includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Runa Gage facing as an external strategic factors. Some of the topics covered in Runa: Driving Social Change through Passion and Profit case study are - Strategic Management Strategies, Financial management, Joint ventures, Marketing, Social enterprise and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Runa: Driving Social Change through Passion and Profit casestudy better are - – technology disruption, banking and financial system is disrupted by Bitcoin and other crypto currencies, central banks are concerned over increasing inflation, increasing commodity prices, increasing household debt because of falling income levels, there is increasing trade war between United States & China, increasing energy prices,
cloud computing is disrupting traditional business models, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of Runa: Driving Social Change through Passion and Profit
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Runa: Driving Social Change through Passion and Profit case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Runa Gage, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Runa Gage 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 Runa: Driving Social Change through Passion and Profit can be done for the following purposes –
1. Strategic planning using facts provided in Runa: Driving Social Change through Passion and Profit case study
2. Improving business portfolio management of Runa Gage
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 Runa Gage
Strengths Runa: Driving Social Change through Passion and Profit | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Runa Gage in Runa: Driving Social Change through Passion and Profit Harvard Business Review case study are -
Ability to lead change in Innovation & Entrepreneurship field
– Runa Gage 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 Runa Gage in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Innovation driven organization
– Runa Gage is one of the most innovative firm in sector. Manager in Runa: Driving Social Change through Passion and Profit Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Highly skilled collaborators
– Runa Gage 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 Runa: Driving Social Change through Passion and Profit HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– Runa: Driving Social Change through Passion and Profit firm has clearly differentiated products in the market place. This has enabled Runa Gage to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Runa Gage to invest into research and development (R&D) and innovation.
Operational resilience
– The operational resilience strategy in the Runa: Driving Social Change through Passion and Profit 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.
Ability to recruit top talent
– Runa Gage is one of the leading recruiters in the industry. Managers in the Runa: Driving Social Change through Passion and Profit are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Successful track record of launching new products
– Runa Gage has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Runa Gage 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.
High switching costs
– The high switching costs that Runa Gage 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.
Training and development
– Runa Gage has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Runa: Driving Social Change through Passion and Profit 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.
Learning organization
- Runa Gage 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 Runa Gage is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Runa: Driving Social Change through Passion and Profit Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Low bargaining power of suppliers
– Suppliers of Runa Gage in the sector have low bargaining power. Runa: Driving Social Change through Passion and Profit has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Runa Gage to manage not only supply disruptions but also source products at highly competitive prices.
Diverse revenue streams
– Runa Gage is present in almost all the verticals within the industry. This has provided firm in Runa: Driving Social Change through Passion and Profit 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.
Weaknesses Runa: Driving Social Change through Passion and Profit | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Runa: Driving Social Change through Passion and Profit are -
High operating costs
– Compare to the competitors, firm in the HBR case study Runa: Driving Social Change through Passion and Profit 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 Runa Gage 's lucrative customers.
Slow decision making process
– As mentioned earlier in the report, Runa Gage 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. Runa Gage 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.
Products dominated business model
– Even though Runa Gage 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 - Runa: Driving Social Change through Passion and Profit should strive to include more intangible value offerings along with its core products and services.
No frontier risks strategy
– After analyzing the HBR case study Runa: Driving Social Change through Passion and Profit, 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Runa Gage is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Runa: Driving Social Change through Passion and Profit can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Runa Gage 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.
Increasing silos among functional specialists
– The organizational structure of Runa Gage is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Runa Gage needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Runa Gage to focus more on services rather than just following the product oriented approach.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Runa: Driving Social Change through Passion and Profit 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 Runa Gage has relatively successful track record of launching new products.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Runa: Driving Social Change through Passion and Profit, is just above the industry average. Runa Gage 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 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 Runa Gage supply chain. Even after few cautionary changes mentioned in the HBR case study - Runa: Driving Social Change through Passion and Profit, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Runa Gage vulnerable to further global disruptions in South East Asia.
Capital Spending Reduction
– Even during the low interest decade, Runa Gage 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 Runa: Driving Social Change through Passion and Profit | 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 Runa: Driving Social Change through Passion and Profit are -
Manufacturing automation
– Runa Gage 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Runa Gage 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Runa Gage 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, Runa: Driving Social Change through Passion and Profit, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Using analytics as competitive advantage
– Runa Gage 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 Runa: Driving Social Change through Passion and Profit - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Runa Gage to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Runa Gage is facing challenges because of the dominance of functional experts in the organization. Runa: Driving Social Change through Passion and Profit 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.
Buying journey improvements
– Runa Gage can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Runa: Driving Social Change through Passion and Profit 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.
Leveraging digital technologies
– Runa Gage 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Runa Gage 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 Runa Gage has opened avenues for new revenue streams for the organization in the industry. This can help Runa Gage to build a more holistic ecosystem as suggested in the Runa: Driving Social Change through Passion and Profit case study. Runa Gage can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Better consumer reach
– The expansion of the 5G network will help Runa Gage to increase its market reach. Runa Gage 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.
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. Runa Gage can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Learning at scale
– Online learning technologies has now opened space for Runa Gage 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. Runa Gage can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats Runa: Driving Social Change through Passion and Profit External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Runa: Driving Social Change through Passion and Profit are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Runa Gage with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Stagnating economy with rate increase
– Runa Gage 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.
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. Runa Gage needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Runa Gage 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Runa: Driving Social Change through Passion and Profit, Runa Gage 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 .
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.
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 Runa Gage business can come under increasing regulations regarding data privacy, data security, etc.
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 Runa Gage.
Technology acceleration in Forth Industrial Revolution
– Runa Gage has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Runa Gage needs to keep up with the evolution of technology in the Innovation & Entrepreneurship sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Increasing wage structure of Runa Gage
– 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 Runa Gage.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Runa Gage 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 Runa: Driving Social Change through Passion and Profit .
Shortening product life cycle
– it is one of the major threat that Runa Gage is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
High dependence on third party suppliers
– Runa Gage 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.
Weighted SWOT Analysis of Runa: Driving Social Change through Passion and Profit 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 Runa: Driving Social Change through Passion and Profit 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 Runa: Driving Social Change through Passion and Profit 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 Runa: Driving Social Change through Passion and Profit 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 Runa: Driving Social Change through Passion and Profit 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 Runa Gage needs to make to build a sustainable competitive advantage.
