Case Study Description of Pepsi's Regeneration--1990-93
Craig Weatherup, the president and CEO of Pepsi Cola, leads a change process that completely transforms his company. It includes a new vision, operating philosophy, strategy, and organizational structure. He also introduces process improvement techniques and builds new performance metrics around these processes and the newly desired behaviors.
Swot Analysis of "Pepsi's Regeneration--1990-93" written by David A. Garvin, Donald N. Sull includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Regeneration Weatherup facing as an external strategic factors. Some of the topics covered in Pepsi's Regeneration--1990-93 case study are - Strategic Management Strategies, Corporate governance, Developing employees, Growth strategy, Leadership, Organizational structure and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Pepsi's Regeneration--1990-93 casestudy better are - – cloud computing is disrupting traditional business models, banking and financial system is disrupted by Bitcoin and other crypto currencies, geopolitical disruptions, digital marketing is dominated by two big players Facebook and Google, increasing energy prices, increasing government debt because of Covid-19 spendings, increasing transportation and logistics costs,
increasing inequality as vast percentage of new income is going to the top 1%, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
Introduction to SWOT Analysis of Pepsi's Regeneration--1990-93
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Pepsi's Regeneration--1990-93 case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Regeneration Weatherup, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Regeneration Weatherup 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 Pepsi's Regeneration--1990-93 can be done for the following purposes –
1. Strategic planning using facts provided in Pepsi's Regeneration--1990-93 case study
2. Improving business portfolio management of Regeneration Weatherup
3. Assessing feasibility of the new initiative in Leadership & Managing People field.
4. Making a Leadership & Managing People topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Regeneration Weatherup
Strengths Pepsi's Regeneration--1990-93 | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Regeneration Weatherup in Pepsi's Regeneration--1990-93 Harvard Business Review case study are -
Innovation driven organization
– Regeneration Weatherup is one of the most innovative firm in sector. Manager in Pepsi's Regeneration--1990-93 Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Ability to lead change in Leadership & Managing People field
– Regeneration Weatherup 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 Regeneration Weatherup in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Effective Research and Development (R&D)
– Regeneration Weatherup 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 Pepsi's Regeneration--1990-93 - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Successful track record of launching new products
– Regeneration Weatherup has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Regeneration Weatherup has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Diverse revenue streams
– Regeneration Weatherup is present in almost all the verticals within the industry. This has provided firm in Pepsi's Regeneration--1990-93 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.
Low bargaining power of suppliers
– Suppliers of Regeneration Weatherup in the sector have low bargaining power. Pepsi's Regeneration--1990-93 has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Regeneration Weatherup to manage not only supply disruptions but also source products at highly competitive prices.
Strong track record of project management
– Regeneration Weatherup is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Cross disciplinary teams
– Horizontal connected teams at the Regeneration Weatherup 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.
Learning organization
- Regeneration Weatherup 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 Regeneration Weatherup is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Pepsi's Regeneration--1990-93 Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in Leadership & Managing People industry
– Pepsi's Regeneration--1990-93 firm has clearly differentiated products in the market place. This has enabled Regeneration Weatherup to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Regeneration Weatherup to invest into research and development (R&D) and innovation.
Superior customer experience
– The customer experience strategy of Regeneration Weatherup in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Regeneration Weatherup 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 Pepsi's Regeneration--1990-93 HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses Pepsi's Regeneration--1990-93 | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Pepsi's Regeneration--1990-93 are -
Increasing silos among functional specialists
– The organizational structure of Regeneration Weatherup is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Regeneration Weatherup needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Regeneration Weatherup 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 Pepsi's Regeneration--1990-93, in the dynamic environment Regeneration Weatherup has struggled to respond to the nimble upstart competition. Regeneration Weatherup 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 Pepsi's Regeneration--1990-93 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 Pepsi's Regeneration--1990-93 can leverage the sales team experience to cultivate customer relationships as Regeneration Weatherup is planning to shift buying processes online.
Slow decision making process
– As mentioned earlier in the report, Regeneration Weatherup 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. Regeneration Weatherup 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, Regeneration Weatherup is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Pepsi's Regeneration--1990-93 can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Slow to strategic competitive environment developments
– As Pepsi's Regeneration--1990-93 HBR case study mentions - Regeneration Weatherup 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.
Capital Spending Reduction
– Even during the low interest decade, Regeneration Weatherup 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Pepsi's Regeneration--1990-93, it seems that the employees of Regeneration Weatherup 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 Pepsi's Regeneration--1990-93, is just above the industry average. Regeneration Weatherup 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Pepsi's Regeneration--1990-93 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 Regeneration Weatherup has relatively successful track record of launching new products.
Skills based hiring
– The stress on hiring functional specialists at Regeneration Weatherup 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.
Opportunities Pepsi's Regeneration--1990-93 | 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 Pepsi's Regeneration--1990-93 are -
Loyalty marketing
– Regeneration Weatherup 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Regeneration Weatherup can use these opportunities to build new business models that can help the communities that Regeneration Weatherup operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Regeneration Weatherup 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, Pepsi's Regeneration--1990-93, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Leveraging digital technologies
– Regeneration Weatherup 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
– Regeneration Weatherup 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 Pepsi's Regeneration--1990-93 - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Regeneration Weatherup to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Creating value in data economy
– The success of analytics program of Regeneration Weatherup has opened avenues for new revenue streams for the organization in the industry. This can help Regeneration Weatherup to build a more holistic ecosystem as suggested in the Pepsi's Regeneration--1990-93 case study. Regeneration Weatherup 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 Regeneration Weatherup 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 Regeneration Weatherup to hire the very best people irrespective of their geographical location.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Regeneration Weatherup is facing challenges because of the dominance of functional experts in the organization. Pepsi's Regeneration--1990-93 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.
Learning at scale
– Online learning technologies has now opened space for Regeneration Weatherup 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.
Better consumer reach
– The expansion of the 5G network will help Regeneration Weatherup to increase its market reach. Regeneration Weatherup 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.
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 Regeneration Weatherup 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Regeneration Weatherup 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 Regeneration Weatherup 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 Leadership & Managing People segment.
Threats Pepsi's Regeneration--1990-93 External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Pepsi's Regeneration--1990-93 are -
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 Regeneration Weatherup.
Increasing wage structure of Regeneration Weatherup
– 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 Regeneration Weatherup.
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. Regeneration Weatherup needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Stagnating economy with rate increase
– Regeneration Weatherup can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Regeneration Weatherup in the Leadership & Managing People industry. The Leadership & Managing People 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.
Consumer confidence and its impact on Regeneration Weatherup 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.
Regulatory challenges
– Regeneration Weatherup 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 Leadership & Managing People industry regulations.
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. Regeneration Weatherup 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 international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Regeneration Weatherup 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 Pepsi's Regeneration--1990-93 .
High dependence on third party suppliers
– Regeneration Weatherup 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.
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.
Technology acceleration in Forth Industrial Revolution
– Regeneration Weatherup has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Regeneration Weatherup needs to keep up with the evolution of technology in the Leadership & Managing People 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.
Shortening product life cycle
– it is one of the major threat that Regeneration Weatherup is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Pepsi's Regeneration--1990-93 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 Pepsi's Regeneration--1990-93 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 Pepsi's Regeneration--1990-93 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 Pepsi's Regeneration--1990-93 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 Pepsi's Regeneration--1990-93 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 Regeneration Weatherup needs to make to build a sustainable competitive advantage.
