Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B)
This is the second part of a case series dealing with the distribution of FMCG (Fast Moving Consumer Goods) to low income areas (slums) in Kenya. It describes the successful launch of KasKazi Network - a revolutionary concept of distribution by bicycle to the "bottom of the pyramid." It reveals how Wanjohi dealt with the key stakeholders (FMCG manufacturers, wholesalers, and retailers) as well as operational issues and HR policies. Learning objectives: The case series would be suitable for a core marketing course (dealing with the market challenge, and distribution and retail issues in Africa), a course on supply chain (distribution issues in Africa), an entrepreneurship course (dealing with business growth strategies) or a general management course. In all these courses, the case series can be used to illustrate the challenge and complexity of reaching low income customers in developing countries.
Authors :: Leif Sjoblom, Winifred Karugu, Lisa Schuepbach
Swot Analysis of "Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B)" written by Leif Sjoblom, Winifred Karugu, Lisa Schuepbach includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Kaskazi Fmcg facing as an external strategic factors. Some of the topics covered in Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) case study are - Strategic Management Strategies, Marketing, Supply chain and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) casestudy better are - – increasing commodity prices, increasing inequality as vast percentage of new income is going to the top 1%, digital marketing is dominated by two big players Facebook and Google, geopolitical disruptions, cloud computing is disrupting traditional business models, wage bills are increasing, supply chains are disrupted by pandemic ,
competitive advantages are harder to sustain because of technology dispersion, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Kaskazi Fmcg, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Kaskazi Fmcg 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 Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) can be done for the following purposes –
1. Strategic planning using facts provided in Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) case study
2. Improving business portfolio management of Kaskazi Fmcg
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 Kaskazi Fmcg
Strengths Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Kaskazi Fmcg in Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) Harvard Business Review case study are -
Highly skilled collaborators
– Kaskazi Fmcg 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 Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Analytics focus
– Kaskazi Fmcg 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 Leif Sjoblom, Winifred Karugu, Lisa Schuepbach 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.
Innovation driven organization
– Kaskazi Fmcg is one of the most innovative firm in sector. Manager in Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Effective Research and Development (R&D)
– Kaskazi Fmcg 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 Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Strong track record of project management
– Kaskazi Fmcg is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to lead change in Innovation & Entrepreneurship field
– Kaskazi Fmcg 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 Kaskazi Fmcg in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High switching costs
– The high switching costs that Kaskazi Fmcg 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.
Digital Transformation in Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Kaskazi Fmcg digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Kaskazi Fmcg 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.
Operational resilience
– The operational resilience strategy in the Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) 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
– Kaskazi Fmcg has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Kaskazi Fmcg to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Cross disciplinary teams
– Horizontal connected teams at the Kaskazi Fmcg 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.
Training and development
– Kaskazi Fmcg has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) 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.
Weaknesses Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) are -
Products dominated business model
– Even though Kaskazi Fmcg 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 - Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) should strive to include more intangible value offerings along with its core products and services.
Lack of clear differentiation of Kaskazi Fmcg products
– To increase the profitability and margins on the products, Kaskazi Fmcg needs to provide more differentiated products than what it is currently offering in the marketplace.
Aligning sales with marketing
– It come across in the case study Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) 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 Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) can leverage the sales team experience to cultivate customer relationships as Kaskazi Fmcg is planning to shift buying processes online.
High bargaining power of channel partners
– Because of the regulatory requirements, Leif Sjoblom, Winifred Karugu, Lisa Schuepbach suggests that, Kaskazi Fmcg 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.
Need for greater diversity
– Kaskazi Fmcg 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.
Increasing silos among functional specialists
– The organizational structure of Kaskazi Fmcg is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Kaskazi Fmcg needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Kaskazi Fmcg to focus more on services rather than just following the product oriented approach.
Skills based hiring
– The stress on hiring functional specialists at Kaskazi Fmcg has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
No frontier risks strategy
– After analyzing the HBR case study Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B), it seems that company is thinking about the frontier risks that can impact Innovation & Entrepreneurship strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
High operating costs
– Compare to the competitors, firm in the HBR case study Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) 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 Kaskazi Fmcg 's lucrative customers.
Slow decision making process
– As mentioned earlier in the report, Kaskazi Fmcg 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. Kaskazi Fmcg 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Kaskazi Fmcg is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) | 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 Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Kaskazi Fmcg is facing challenges because of the dominance of functional experts in the organization. Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Kaskazi Fmcg 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.
Buying journey improvements
– Kaskazi Fmcg can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) 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.
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. Kaskazi Fmcg can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Kaskazi Fmcg 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.
Building a culture of innovation
– managers at Kaskazi Fmcg 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.
Better consumer reach
– The expansion of the 5G network will help Kaskazi Fmcg to increase its market reach. Kaskazi Fmcg 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.
Developing new processes and practices
– Kaskazi Fmcg 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.
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. Kaskazi Fmcg can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Leveraging digital technologies
– Kaskazi Fmcg 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.
Using analytics as competitive advantage
– Kaskazi Fmcg 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 Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Kaskazi Fmcg to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Learning at scale
– Online learning technologies has now opened space for Kaskazi Fmcg 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Kaskazi Fmcg can use these opportunities to build new business models that can help the communities that Kaskazi Fmcg operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Threats Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) are -
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Kaskazi Fmcg will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Technology acceleration in Forth Industrial Revolution
– Kaskazi Fmcg has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Kaskazi Fmcg 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.
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.
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 Kaskazi Fmcg in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Shortening product life cycle
– it is one of the major threat that Kaskazi Fmcg is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Regulatory challenges
– Kaskazi Fmcg 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Kaskazi Fmcg with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Kaskazi Fmcg 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 Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) .
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 Kaskazi Fmcg.
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 Kaskazi Fmcg business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Kaskazi Fmcg 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.
Consumer confidence and its impact on Kaskazi Fmcg demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Kaskazi Fmcg 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 Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) 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 Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) 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 Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) 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 Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) 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 Kaskazi Network Ltd - Distributing to the Bottom of the Pyramid (B) 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 Kaskazi Fmcg needs to make to build a sustainable competitive advantage.