Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study SWOT Analysis Solution
Case Study Description of Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream
The case is about the concerns of second generation entrepreneurs in a family managed business who aspire to attain the next orbit, the next level of success in the business. Natural Ice Cream was started by the father in 1980s. The passionate ice cream maker made two small innovations; one, a product innovation in the form of using only natural ingredients. He was so creative that he could come up with 125 combinations of fresh and dried fruits in ice cream. Two, a marketing innovation in the form of selling ice cream only in exclusive ice cream parlours. Both were novel ideas of the time and became the 'Unique Selling Propositions' (USPs). The business expanded over the three decades and with the help of his sons changed the scale and adapted best practices of management. The expansion path was carefully drawn up by preserving the USPs of the business. The franchise route for expansion was used. Manufacturing remained at a central location to keep strict quality control. Having taken their business from a small dream to INR 1 billion niche brand in the artisan ice cream segment, the owners at Naturals were dreaming big. They were restless and anxious to enter the next orbit and aspired to become a pan-India and global brand.
Swot Analysis of "Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream" written by Pallavi Mody, Raveendra Chittoor includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Cream Ice facing as an external strategic factors. Some of the topics covered in Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream case study are - Strategic Management Strategies, Innovation and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream casestudy better are - – supply chains are disrupted by pandemic , digital marketing is dominated by two big players Facebook and Google, banking and financial system is disrupted by Bitcoin and other crypto currencies, competitive advantages are harder to sustain because of technology dispersion, challanges to central banks by blockchain based private currencies, increasing energy prices, talent flight as more people leaving formal jobs,
increasing transportation and logistics costs, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Cream Ice, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Cream Ice 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 Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream can be done for the following purposes –
1. Strategic planning using facts provided in Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream case study
2. Improving business portfolio management of Cream Ice
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 Cream Ice
Strengths Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Cream Ice in Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream Harvard Business Review case study are -
Analytics focus
– Cream Ice 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 Pallavi Mody, Raveendra Chittoor 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.
Superior customer experience
– The customer experience strategy of Cream Ice in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the Cream Ice 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.
Low bargaining power of suppliers
– Suppliers of Cream Ice in the sector have low bargaining power. Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Cream Ice to manage not only supply disruptions but also source products at highly competitive prices.
Training and development
– Cream Ice has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream 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.
Highly skilled collaborators
– Cream Ice 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 Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– Cream Ice has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Cream Ice 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.
Operational resilience
– The operational resilience strategy in the Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream 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.
High brand equity
– Cream Ice has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Cream Ice to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Digital Transformation in Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Cream Ice digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Cream Ice has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Learning organization
- Cream Ice 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 Cream Ice is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Strong track record of project management
– Cream Ice is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream are -
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream, is just above the industry average. Cream Ice 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.
Increasing silos among functional specialists
– The organizational structure of Cream Ice is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Cream Ice needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Cream Ice to focus more on services rather than just following the product oriented approach.
Low market penetration in new markets
– Outside its home market of Cream Ice, firm in the HBR case study Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
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 Cream Ice supply chain. Even after few cautionary changes mentioned in the HBR case study - Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Cream Ice vulnerable to further global disruptions in South East Asia.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream, it seems that the employees of Cream Ice 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.
Slow decision making process
– As mentioned earlier in the report, Cream Ice 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. Cream Ice 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.
Interest costs
– Compare to the competition, Cream Ice 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.
Products dominated business model
– Even though Cream Ice 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 - Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream should strive to include more intangible value offerings along with its core products and services.
High bargaining power of channel partners
– Because of the regulatory requirements, Pallavi Mody, Raveendra Chittoor suggests that, Cream Ice 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream 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 Cream Ice has relatively successful track record of launching new products.
Slow to strategic competitive environment developments
– As Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream HBR case study mentions - Cream Ice 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.
Opportunities Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream | 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 Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream are -
Developing new processes and practices
– Cream Ice can develop new processes and procedures in Innovation & Entrepreneurship industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Cream Ice can use these opportunities to build new business models that can help the communities that Cream Ice operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
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. Cream Ice can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Manufacturing automation
– Cream Ice 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 Cream Ice 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, Cream Ice 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, Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Learning at scale
– Online learning technologies has now opened space for Cream Ice 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.
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. Cream Ice can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Buying journey improvements
– Cream Ice can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream 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, Cream Ice 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Cream Ice can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Building a culture of innovation
– managers at Cream Ice 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.
Using analytics as competitive advantage
– Cream Ice 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 Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Cream Ice to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Cream Ice with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Technology acceleration in Forth Industrial Revolution
– Cream Ice has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Cream Ice 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.
Environmental challenges
– Cream Ice 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. Cream Ice can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
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 Cream Ice in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Regulatory challenges
– Cream Ice 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.
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.
Easy access to finance
– Easy access to finance in Innovation & Entrepreneurship field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Cream Ice can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
High dependence on third party suppliers
– Cream Ice 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Cream Ice 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 Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream .
Increasing wage structure of Cream Ice
– 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 Cream Ice.
Stagnating economy with rate increase
– Cream Ice 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream, Cream Ice 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 .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Cream Ice 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.
Weighted SWOT Analysis of Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream 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 Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream 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 Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream 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 Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream 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 Attaining the Next Orbit: Dilemmas of a Family Managed Business - Natural Ice Cream 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 Cream Ice needs to make to build a sustainable competitive advantage.
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