Nacre (B): a Steep and Risky Climb to Success SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Nacre (B): a Steep and Risky Climb to Success
This case B cannot be taught as a stand-alone case, but is a direct continuation of the FocusCase "Nacre: Turning a Lab Idea into a High-Growth Firm (A)" [EFC-2-E]. This case B describes the strategic decisions and actions of the CEO and how eventually, this firm - with only 12-15 employees at that time (plus a large contract manufacturer) - manages to land a US-$30 million deal with the US Marine Corp. Soon after, this company is acquired by a large corporation, making this deal the most successful exit in Europe in that year (2007). Afterwards the firm gets integrated into the new parent corporation and proves to be one of the best technologies available in the market. A related video [EV-6] with the CEO is providing complimentary information and material to teach the case.
Authors :: Julia Prats Moreno, Marc Sosna, Dave Darsch
Swot Analysis of "Nacre (B): a Steep and Risky Climb to Success" written by Julia Prats Moreno, Marc Sosna, Dave Darsch includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Nacre Complimentary facing as an external strategic factors. Some of the topics covered in Nacre (B): a Steep and Risky Climb to Success case study are - Strategic Management Strategies, Operations management, Product development, Security & privacy and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Nacre (B): a Steep and Risky Climb to Success casestudy better are - – competitive advantages are harder to sustain because of technology dispersion, increasing energy prices, challanges to central banks by blockchain based private currencies, increasing inequality as vast percentage of new income is going to the top 1%, supply chains are disrupted by pandemic , increasing commodity prices, customer relationship management is fast transforming because of increasing concerns over data privacy,
geopolitical disruptions, there is backlash against globalization, etc
Introduction to SWOT Analysis of Nacre (B): a Steep and Risky Climb to Success
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Nacre (B): a Steep and Risky Climb to Success case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Nacre Complimentary, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Nacre Complimentary 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 Nacre (B): a Steep and Risky Climb to Success can be done for the following purposes –
1. Strategic planning using facts provided in Nacre (B): a Steep and Risky Climb to Success case study
2. Improving business portfolio management of Nacre Complimentary
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 Nacre Complimentary
Strengths Nacre (B): a Steep and Risky Climb to Success | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Nacre Complimentary in Nacre (B): a Steep and Risky Climb to Success Harvard Business Review case study are -
Highly skilled collaborators
– Nacre Complimentary 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 Nacre (B): a Steep and Risky Climb to Success HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Cross disciplinary teams
– Horizontal connected teams at the Nacre Complimentary 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.
Organizational Resilience of Nacre Complimentary
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Nacre Complimentary does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Innovation driven organization
– Nacre Complimentary is one of the most innovative firm in sector. Manager in Nacre (B): a Steep and Risky Climb to Success Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– Nacre (B): a Steep and Risky Climb to Success firm has clearly differentiated products in the market place. This has enabled Nacre Complimentary to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Nacre Complimentary to invest into research and development (R&D) and innovation.
High brand equity
– Nacre Complimentary has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Nacre Complimentary to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Training and development
– Nacre Complimentary has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Nacre (B): a Steep and Risky Climb to Success 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.
Ability to recruit top talent
– Nacre Complimentary is one of the leading recruiters in the industry. Managers in the Nacre (B): a Steep and Risky Climb to Success are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Operational resilience
– The operational resilience strategy in the Nacre (B): a Steep and Risky Climb to Success 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.
Analytics focus
– Nacre Complimentary 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 Julia Prats Moreno, Marc Sosna, Dave Darsch 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.
Learning organization
- Nacre Complimentary 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 Nacre Complimentary is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Nacre (B): a Steep and Risky Climb to Success Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Strong track record of project management
– Nacre Complimentary is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses Nacre (B): a Steep and Risky Climb to Success | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Nacre (B): a Steep and Risky Climb to Success are -
Workers concerns about automation
– As automation is fast increasing in the segment, Nacre Complimentary 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.
Skills based hiring
– The stress on hiring functional specialists at Nacre Complimentary 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.
Need for greater diversity
– Nacre Complimentary 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 Nacre Complimentary is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Nacre Complimentary needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Nacre Complimentary to focus more on services rather than just following the product oriented approach.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Nacre (B): a Steep and Risky Climb to Success, in the dynamic environment Nacre Complimentary has struggled to respond to the nimble upstart competition. Nacre Complimentary has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow decision making process
– As mentioned earlier in the report, Nacre Complimentary 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. Nacre Complimentary 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Nacre (B): a Steep and Risky Climb to Success 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 Nacre Complimentary has relatively successful track record of launching new products.
High cash cycle compare to competitors
Nacre Complimentary 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, Nacre Complimentary 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.
No frontier risks strategy
– After analyzing the HBR case study Nacre (B): a Steep and Risky Climb to Success, 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 Nacre (B): a Steep and Risky Climb to Success 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 Nacre Complimentary 's lucrative customers.
Opportunities Nacre (B): a Steep and Risky Climb to Success | 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 Nacre (B): a Steep and Risky Climb to Success are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Nacre Complimentary 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 Nacre Complimentary 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.
Creating value in data economy
– The success of analytics program of Nacre Complimentary has opened avenues for new revenue streams for the organization in the industry. This can help Nacre Complimentary to build a more holistic ecosystem as suggested in the Nacre (B): a Steep and Risky Climb to Success case study. Nacre Complimentary can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Learning at scale
– Online learning technologies has now opened space for Nacre Complimentary to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Nacre Complimentary can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 Nacre Complimentary 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Nacre Complimentary 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 Nacre Complimentary to hire the very best people irrespective of their geographical location.
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 Nacre Complimentary in the consumer business. Now Nacre Complimentary can target international markets with far fewer capital restrictions requirements than the existing system.
Buying journey improvements
– Nacre Complimentary can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Nacre (B): a Steep and Risky Climb to Success 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.
Leveraging digital technologies
– Nacre Complimentary 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
– Nacre Complimentary 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 Nacre (B): a Steep and Risky Climb to Success - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Nacre Complimentary to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Nacre Complimentary is facing challenges because of the dominance of functional experts in the organization. Nacre (B): a Steep and Risky Climb to Success 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.
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. Nacre Complimentary 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. Nacre Complimentary 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.
Threats Nacre (B): a Steep and Risky Climb to Success External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Nacre (B): a Steep and Risky Climb to Success are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Nacre (B): a Steep and Risky Climb to Success, Nacre Complimentary 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 .
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. Nacre Complimentary 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.
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 Nacre Complimentary business can come under increasing regulations regarding data privacy, data security, etc.
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Nacre Complimentary 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 Nacre (B): a Steep and Risky Climb to Success .
Regulatory challenges
– Nacre Complimentary 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.
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 Nacre Complimentary.
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 Nacre Complimentary in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– Nacre Complimentary has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Nacre Complimentary 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.
Increasing wage structure of Nacre Complimentary
– 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 Nacre Complimentary.
High dependence on third party suppliers
– Nacre Complimentary 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Nacre Complimentary with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Shortening product life cycle
– it is one of the major threat that Nacre Complimentary is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Nacre (B): a Steep and Risky Climb to Success 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 Nacre (B): a Steep and Risky Climb to Success 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 Nacre (B): a Steep and Risky Climb to Success 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 Nacre (B): a Steep and Risky Climb to Success 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 Nacre (B): a Steep and Risky Climb to Success 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 Nacre Complimentary needs to make to build a sustainable competitive advantage.