Vendex KBB: First Hundred Days in Crisis SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Vendex KBB: First Hundred Days in Crisis
Vendex KBB is at crisis point at the end of 2004, especially its flagship V&D department stores. A consortium of private-equity investors led by KKR, who bought the business a year earlier, persuade retail veteran Tony DeNunzio to take on the challenge of turning the diversified holding company around. Reluctant at first, he agrees, but only for three years and thereafter for 18 months part time. His mandate is clear: to turn around the iconic Dutch business by adding value to all stakeholders, not just the PE firm, a mission made more difficult by the reputation PE firms have recently acquired as 'barbarians at the gate'. About to embark on his first 100 days, what should he do on his first day? Please visit the dedicated case website http://cases.insead.edu/vendexkbb-maxeda/ (copy and paste the url into a browser) to view video interviews and other support material.
Swot Analysis of "Vendex KBB: First Hundred Days in Crisis" written by Joost De Haas, Anne-Marie Carrick includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Kbb Vendex facing as an external strategic factors. Some of the topics covered in Vendex KBB: First Hundred Days in Crisis case study are - Strategic Management Strategies, Entrepreneurial finance, Leadership and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Vendex KBB: First Hundred Days in Crisis casestudy better are - – technology disruption, cloud computing is disrupting traditional business models, digital marketing is dominated by two big players Facebook and Google, wage bills are increasing, there is backlash against globalization, increasing energy prices, increasing household debt because of falling income levels,
increasing commodity prices, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of Vendex KBB: First Hundred Days in Crisis
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Vendex KBB: First Hundred Days in Crisis case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Kbb Vendex, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Kbb Vendex 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 Vendex KBB: First Hundred Days in Crisis can be done for the following purposes –
1. Strategic planning using facts provided in Vendex KBB: First Hundred Days in Crisis case study
2. Improving business portfolio management of Kbb Vendex
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 Kbb Vendex
Strengths Vendex KBB: First Hundred Days in Crisis | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Kbb Vendex in Vendex KBB: First Hundred Days in Crisis Harvard Business Review case study are -
Organizational Resilience of Kbb Vendex
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Kbb Vendex does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– Kbb Vendex has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Vendex KBB: First Hundred Days in Crisis 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.
Cross disciplinary teams
– Horizontal connected teams at the Kbb Vendex 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.
Analytics focus
– Kbb Vendex 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 Joost De Haas, Anne-Marie Carrick 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.
Ability to recruit top talent
– Kbb Vendex is one of the leading recruiters in the industry. Managers in the Vendex KBB: First Hundred Days in Crisis are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
High brand equity
– Kbb Vendex has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Kbb Vendex 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 Kbb Vendex digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Kbb Vendex 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 switching costs
– The high switching costs that Kbb Vendex 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
– Kbb Vendex is present in almost all the verticals within the industry. This has provided firm in Vendex KBB: First Hundred Days in Crisis 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.
Learning organization
- Kbb Vendex 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 Kbb Vendex is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Vendex KBB: First Hundred Days in Crisis Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– Kbb Vendex is one of the most innovative firm in sector. Manager in Vendex KBB: First Hundred Days in Crisis Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Operational resilience
– The operational resilience strategy in the Vendex KBB: First Hundred Days in Crisis 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.
Weaknesses Vendex KBB: First Hundred Days in Crisis | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Vendex KBB: First Hundred Days in Crisis are -
Capital Spending Reduction
– Even during the low interest decade, Kbb Vendex 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Vendex KBB: First Hundred Days in Crisis, in the dynamic environment Kbb Vendex has struggled to respond to the nimble upstart competition. Kbb Vendex has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Aligning sales with marketing
– It come across in the case study Vendex KBB: First Hundred Days in Crisis 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 Vendex KBB: First Hundred Days in Crisis can leverage the sales team experience to cultivate customer relationships as Kbb Vendex is planning to shift buying processes online.
Skills based hiring
– The stress on hiring functional specialists at Kbb Vendex 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.
High cash cycle compare to competitors
Kbb Vendex has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Interest costs
– Compare to the competition, Kbb Vendex 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.
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 Kbb Vendex supply chain. Even after few cautionary changes mentioned in the HBR case study - Vendex KBB: First Hundred Days in Crisis, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Kbb Vendex vulnerable to further global disruptions in South East Asia.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Kbb Vendex is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Vendex KBB: First Hundred Days in Crisis can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Kbb Vendex needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
No frontier risks strategy
– After analyzing the HBR case study Vendex KBB: First Hundred Days in Crisis, 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 Vendex KBB: First Hundred Days in Crisis 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 Kbb Vendex 's lucrative customers.
Opportunities Vendex KBB: First Hundred Days in Crisis | 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 Vendex KBB: First Hundred Days in Crisis are -
Creating value in data economy
– The success of analytics program of Kbb Vendex has opened avenues for new revenue streams for the organization in the industry. This can help Kbb Vendex to build a more holistic ecosystem as suggested in the Vendex KBB: First Hundred Days in Crisis case study. Kbb Vendex can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Kbb Vendex 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 Kbb Vendex to hire the very best people irrespective of their geographical location.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Kbb Vendex 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, Vendex KBB: First Hundred Days in Crisis, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Kbb Vendex can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Kbb Vendex 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.
Buying journey improvements
– Kbb Vendex can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Vendex KBB: First Hundred Days in Crisis 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.
Better consumer reach
– The expansion of the 5G network will help Kbb Vendex to increase its market reach. Kbb Vendex 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
– Kbb Vendex 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.
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. Kbb Vendex can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Kbb Vendex is facing challenges because of the dominance of functional experts in the organization. Vendex KBB: First Hundred Days in Crisis 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Kbb Vendex can use these opportunities to build new business models that can help the communities that Kbb Vendex operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
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 Kbb Vendex in the consumer business. Now Kbb Vendex can target international markets with far fewer capital restrictions requirements than the existing system.
Using analytics as competitive advantage
– Kbb Vendex 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 Vendex KBB: First Hundred Days in Crisis - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Kbb Vendex to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Vendex KBB: First Hundred Days in Crisis External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Vendex KBB: First Hundred Days in Crisis are -
Stagnating economy with rate increase
– Kbb Vendex 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.
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 Kbb Vendex in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– Kbb Vendex has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Kbb Vendex 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Kbb Vendex 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, Kbb Vendex 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 Vendex KBB: First Hundred Days in Crisis .
Shortening product life cycle
– it is one of the major threat that Kbb Vendex is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Environmental challenges
– Kbb Vendex 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. Kbb Vendex can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
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 Kbb Vendex.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Kbb Vendex 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.
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. Kbb Vendex can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Kbb Vendex 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 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.
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. Kbb Vendex needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.
Weighted SWOT Analysis of Vendex KBB: First Hundred Days in Crisis 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 Vendex KBB: First Hundred Days in Crisis 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 Vendex KBB: First Hundred Days in Crisis 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 Vendex KBB: First Hundred Days in Crisis 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 Vendex KBB: First Hundred Days in Crisis 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 Kbb Vendex needs to make to build a sustainable competitive advantage.
