Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall"
This case study focuses on Birgit Cameron, senior director of Patagonia Provisions, and several of her colleagues at both Patagonia Provisions and Patagonia as they attempt to increase the scale of sustainable agriculture. The company is attempting to scale up regenerative organic agriculture in two ways. First, Patagonia Provisions is seeking ways to increase the size of its own operations to grow sales and reduce input costs. Second, the company wants to influence the broader food production system, including the practices of other companies, in order to help reverse climate change. Scaling up its own operations will help Provisions become more profitable and potentially allow it to reduce consumer prices; it will also increase the positive environmental impact of Provisions. Influencing the practices of other food companies is key to Patagonia's broader goals of repairing the food chain and reversing climate change.
Authors :: William Rosenzweig, Alastair Iles, Seren Pendleton-Knoll, Robert Strand
Swot Analysis of "Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall"" written by William Rosenzweig, Alastair Iles, Seren Pendleton-Knoll, Robert Strand includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Provisions Patagonia facing as an external strategic factors. Some of the topics covered in Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" case study are - Strategic Management Strategies, Growth strategy, Social responsibility, Sustainability and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" casestudy better are - – increasing energy prices, increasing household debt because of falling income levels, digital marketing is dominated by two big players Facebook and Google, increasing government debt because of Covid-19 spendings, increasing transportation and logistics costs, cloud computing is disrupting traditional business models, talent flight as more people leaving formal jobs,
increasing commodity prices, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall"
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Provisions Patagonia, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Provisions Patagonia 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 Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" can be done for the following purposes –
1. Strategic planning using facts provided in Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" case study
2. Improving business portfolio management of Provisions Patagonia
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 Provisions Patagonia
Strengths Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Provisions Patagonia in Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" Harvard Business Review case study are -
Highly skilled collaborators
– Provisions Patagonia 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 Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High brand equity
– Provisions Patagonia has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Provisions Patagonia to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– Provisions Patagonia is one of the most innovative firm in sector. Manager in Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Analytics focus
– Provisions Patagonia 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 William Rosenzweig, Alastair Iles, Seren Pendleton-Knoll, Robert Strand 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.
Organizational Resilience of Provisions Patagonia
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Provisions Patagonia does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Low bargaining power of suppliers
– Suppliers of Provisions Patagonia in the sector have low bargaining power. Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Provisions Patagonia to manage not only supply disruptions but also source products at highly competitive prices.
Diverse revenue streams
– Provisions Patagonia is present in almost all the verticals within the industry. This has provided firm in Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" 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
- Provisions Patagonia 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 Provisions Patagonia is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– Provisions Patagonia is one of the leading recruiters in the industry. Managers in the Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Cross disciplinary teams
– Horizontal connected teams at the Provisions Patagonia 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.
Ability to lead change in Innovation & Entrepreneurship field
– Provisions Patagonia 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 Provisions Patagonia in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Digital Transformation in Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Provisions Patagonia digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Provisions Patagonia 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.
Weaknesses Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" are -
Need for greater diversity
– Provisions Patagonia 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.
High cash cycle compare to competitors
Provisions Patagonia 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Provisions Patagonia 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall", it seems that the employees of Provisions Patagonia don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall", is just above the industry average. Provisions Patagonia needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Slow to strategic competitive environment developments
– As Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" HBR case study mentions - Provisions Patagonia 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.
Interest costs
– Compare to the competition, Provisions Patagonia 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.
Skills based hiring
– The stress on hiring functional specialists at Provisions Patagonia 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.
Capital Spending Reduction
– Even during the low interest decade, Provisions Patagonia has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" 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 Provisions Patagonia has relatively successful track record of launching new products.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall", in the dynamic environment Provisions Patagonia has struggled to respond to the nimble upstart competition. Provisions Patagonia has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Opportunities Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" | 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 Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" are -
Loyalty marketing
– Provisions Patagonia has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Provisions Patagonia is facing challenges because of the dominance of functional experts in the organization. Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" 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.
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 Provisions Patagonia 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.
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. Provisions Patagonia can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Provisions Patagonia can use these opportunities to build new business models that can help the communities that Provisions Patagonia operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Leveraging digital technologies
– Provisions Patagonia 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.
Building a culture of innovation
– managers at Provisions Patagonia 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.
Learning at scale
– Online learning technologies has now opened space for Provisions Patagonia 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Provisions Patagonia 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Provisions Patagonia 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Provisions Patagonia 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 Provisions Patagonia 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, Provisions Patagonia 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, Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall", to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Buying journey improvements
– Provisions Patagonia can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" 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 Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" are -
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 Provisions Patagonia business can come under increasing regulations regarding data privacy, data security, etc.
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.
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. Provisions Patagonia can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Environmental challenges
– Provisions Patagonia 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. Provisions Patagonia can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
Consumer confidence and its impact on Provisions Patagonia 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Provisions Patagonia 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 Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" .
Stagnating economy with rate increase
– Provisions Patagonia 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.
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 Provisions Patagonia.
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 Provisions Patagonia in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Provisions Patagonia 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.
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. Provisions Patagonia 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.
Increasing wage structure of Provisions Patagonia
– 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 Provisions Patagonia.
Regulatory challenges
– Provisions Patagonia 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.
Weighted SWOT Analysis of Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" 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 Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" 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 Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" 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 Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" 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 Reversing Climate Change Through Sustainable Food: Patagonia Provisions Attempts to Scale a "Big Wall" 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 Provisions Patagonia needs to make to build a sustainable competitive advantage.
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