Blue Skies: Connecting African Farmers to Global Markets SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Blue Skies: Connecting African Farmers to Global Markets
In June 2014, Anthony Pile, founder and chairman of Blue Skies, called a board meeting to discuss the company's development plans. The economic crisis in Europe had made consumers more price sensitive, putting pressure on profit margins and spurring the search for new markets. Founded in 1998, Blue Skies was a fruit processing company headquartered in the U.K., with its main production site located in Ghana, Africa, where it cut and packaged fruits sold primarily to retailers in Europe. Relying on air-freight transport, it shipped produce within 48 hours of harvesting. Although Blue Skies had grown into a multinational with production operations on three continents, the company was still dependent on European markets. It remained largely focused on the U.K., whose retail sector was one of the most competitive in the world, but thanks to its product innovation capabilities, it was in a unique position to shape the future of the fresh-cut fruit industry. The case describes the evolution of Blue Skies since its foundation as a small fruit processing business exporting fresh-cut pineapple to Europe. It gives an overview of its strategy to capture more value using vertical integration as a mean to reduce supply costs and improve the quality of inputs. It illustrates how competitive structures in the fresh-cut market shape the balance of power within the agri-food value chain, and how Blue Skies maintained its competitive edge through a combination of production efficiency, product quality and market diversification.
Swot Analysis of "Blue Skies: Connecting African Farmers to Global Markets" written by John-Paul Ferguson, Laurent De Clara includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Skies Blue facing as an external strategic factors. Some of the topics covered in Blue Skies: Connecting African Farmers to Global Markets case study are - Strategic Management Strategies, Competition, Competitive strategy, Emerging markets, Entrepreneurship, Marketing, Sales, Supply chain and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Blue Skies: Connecting African Farmers to Global Markets casestudy better are - – challanges to central banks by blockchain based private currencies, increasing commodity prices, cloud computing is disrupting traditional business models, digital marketing is dominated by two big players Facebook and Google, supply chains are disrupted by pandemic , geopolitical disruptions, there is backlash against globalization,
central banks are concerned over increasing inflation, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Blue Skies: Connecting African Farmers to Global Markets
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Blue Skies: Connecting African Farmers to Global Markets case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Skies Blue, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Skies Blue 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 Blue Skies: Connecting African Farmers to Global Markets can be done for the following purposes –
1. Strategic planning using facts provided in Blue Skies: Connecting African Farmers to Global Markets case study
2. Improving business portfolio management of Skies Blue
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 Skies Blue
Strengths Blue Skies: Connecting African Farmers to Global Markets | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Skies Blue in Blue Skies: Connecting African Farmers to Global Markets Harvard Business Review case study are -
Effective Research and Development (R&D)
– Skies Blue 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 Blue Skies: Connecting African Farmers to Global Markets - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to lead change in Innovation & Entrepreneurship field
– Skies Blue 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 Skies Blue in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Low bargaining power of suppliers
– Suppliers of Skies Blue in the sector have low bargaining power. Blue Skies: Connecting African Farmers to Global Markets has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Skies Blue to manage not only supply disruptions but also source products at highly competitive prices.
Cross disciplinary teams
– Horizontal connected teams at the Skies Blue 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.
Highly skilled collaborators
– Skies Blue 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 Blue Skies: Connecting African Farmers to Global Markets HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Learning organization
- Skies Blue 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 Skies Blue is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Blue Skies: Connecting African Farmers to Global Markets Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– Skies Blue is one of the most innovative firm in sector. Manager in Blue Skies: Connecting African Farmers to Global Markets Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Diverse revenue streams
– Skies Blue is present in almost all the verticals within the industry. This has provided firm in Blue Skies: Connecting African Farmers to Global Markets 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.
Digital Transformation in Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Skies Blue digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Skies Blue 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.
High brand equity
– Skies Blue has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Skies Blue to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Successful track record of launching new products
– Skies Blue has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Skies Blue 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.
Analytics focus
– Skies Blue 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 John-Paul Ferguson, Laurent De Clara 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.
Weaknesses Blue Skies: Connecting African Farmers to Global Markets | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Blue Skies: Connecting African Farmers to Global Markets are -
Increasing silos among functional specialists
– The organizational structure of Skies Blue is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Skies Blue needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Skies Blue to focus more on services rather than just following the product oriented approach.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Blue Skies: Connecting African Farmers to Global Markets, is just above the industry average. Skies Blue 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 bargaining power of channel partners
– Because of the regulatory requirements, John-Paul Ferguson, Laurent De Clara suggests that, Skies Blue 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 strategic competitive environment developments
– As Blue Skies: Connecting African Farmers to Global Markets HBR case study mentions - Skies Blue 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Blue Skies: Connecting African Farmers to Global Markets 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 Skies Blue 's lucrative customers.
Aligning sales with marketing
– It come across in the case study Blue Skies: Connecting African Farmers to Global Markets 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 Blue Skies: Connecting African Farmers to Global Markets can leverage the sales team experience to cultivate customer relationships as Skies Blue is planning to shift buying processes online.
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 Skies Blue supply chain. Even after few cautionary changes mentioned in the HBR case study - Blue Skies: Connecting African Farmers to Global Markets, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Skies Blue vulnerable to further global disruptions in South East Asia.
Need for greater diversity
– Skies Blue 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.
Capital Spending Reduction
– Even during the low interest decade, Skies Blue 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Blue Skies: Connecting African Farmers to Global Markets 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 Skies Blue has relatively successful track record of launching new products.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Blue Skies: Connecting African Farmers to Global Markets, it seems that the employees of Skies Blue 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.
Opportunities Blue Skies: Connecting African Farmers to Global Markets | 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 Blue Skies: Connecting African Farmers to Global Markets are -
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. Skies Blue can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Skies Blue can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Skies Blue 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 Skies Blue to hire the very best people irrespective of their geographical location.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Innovation & Entrepreneurship industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Skies Blue can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Skies Blue can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Developing new processes and practices
– Skies Blue 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.
Buying journey improvements
– Skies Blue can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Blue Skies: Connecting African Farmers to Global Markets 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.
Using analytics as competitive advantage
– Skies Blue 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 Blue Skies: Connecting African Farmers to Global Markets - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Skies Blue to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Loyalty marketing
– Skies Blue 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.
Creating value in data economy
– The success of analytics program of Skies Blue has opened avenues for new revenue streams for the organization in the industry. This can help Skies Blue to build a more holistic ecosystem as suggested in the Blue Skies: Connecting African Farmers to Global Markets case study. Skies Blue can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at Skies Blue 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Skies Blue 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Skies Blue 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, Blue Skies: Connecting African Farmers to Global Markets, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Skies Blue 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.
Threats Blue Skies: Connecting African Farmers to Global Markets External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Blue Skies: Connecting African Farmers to Global Markets are -
Technology acceleration in Forth Industrial Revolution
– Skies Blue has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Skies Blue 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.
Stagnating economy with rate increase
– Skies Blue 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.
Environmental challenges
– Skies Blue 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. Skies Blue can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
Shortening product life cycle
– it is one of the major threat that Skies Blue is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Skies Blue with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing wage structure of Skies Blue
– 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 Skies Blue.
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. Skies Blue can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Regulatory challenges
– Skies Blue 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 Skies Blue in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Blue Skies: Connecting African Farmers to Global Markets, Skies Blue 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 Skies Blue.
Consumer confidence and its impact on Skies Blue 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.
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 Blue Skies: Connecting African Farmers to Global Markets 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 Blue Skies: Connecting African Farmers to Global Markets 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 Blue Skies: Connecting African Farmers to Global Markets 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 Blue Skies: Connecting African Farmers to Global Markets 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 Blue Skies: Connecting African Farmers to Global Markets 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 Skies Blue needs to make to build a sustainable competitive advantage.