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 - – geopolitical disruptions, central banks are concerned over increasing inflation, technology disruption, digital marketing is dominated by two big players Facebook and Google, competitive advantages are harder to sustain because of technology dispersion, wage bills are increasing, supply chains are disrupted by pandemic ,
banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing government debt because of Covid-19 spendings, 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 -
Ability to recruit top talent
– Skies Blue is one of the leading recruiters in the industry. Managers in the Blue Skies: Connecting African Farmers to Global Markets are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Strong track record of project management
– Skies Blue is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
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.
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.
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.
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.
Organizational Resilience of Skies Blue
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Skies Blue does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High switching costs
– The high switching costs that Skies Blue 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.
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.
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.
Superior customer experience
– The customer experience strategy of Skies Blue in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
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 -
Slow decision making process
– As mentioned earlier in the report, Skies Blue 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. Skies Blue 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.
Low market penetration in new markets
– Outside its home market of Skies Blue, firm in the HBR case study Blue Skies: Connecting African Farmers to Global Markets needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Blue Skies: Connecting African Farmers to Global Markets, in the dynamic environment Skies Blue has struggled to respond to the nimble upstart competition. Skies Blue has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
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.
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 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.
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.
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.
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.
Lack of clear differentiation of Skies Blue products
– To increase the profitability and margins on the products, Skies Blue needs to provide more differentiated products than what it is currently offering in the marketplace.
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 -
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. Skies Blue can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 Skies Blue in the consumer business. Now Skies Blue can target international markets with far fewer capital restrictions requirements than the existing system.
Leveraging digital technologies
– Skies Blue 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 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.
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.
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 Skies Blue 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.
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.
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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Skies Blue can use these opportunities to build new business models that can help the communities that Skies Blue 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. 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.
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.
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.
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 -
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.
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.
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.
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.
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 Skies Blue business can come under increasing regulations regarding data privacy, data security, etc.
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.
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. Skies Blue needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.
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.
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.
High dependence on third party suppliers
– Skies Blue 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.
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 .
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Skies Blue 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 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.
