Zingerman's Community of Businesses: New Business Development SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Zingerman's Community of Businesses: New Business Development
Zingerman's co-founders Ari Weinzweig and Paul Saginaw have a non-traditional approach to growth, allowing employees that receive extensive training through the organization to fulfill their wildest aspirations. Charting a partnership path to ownership, the pair allows employees to forge the businesses of their dreams while benefiting the greater Zingerman's Community of Businesses. The strategy has resulted in the creation of eight successful businesses, with several more in the pipeline and annual sales of approximately $50 million. Students assess this non-conventional approach and discuss the advantages and disadvantages of such a strategy.
Swot Analysis of "Zingerman's Community of Businesses: New Business Development" written by Wayne Baker includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Zingerman's Businesses facing as an external strategic factors. Some of the topics covered in Zingerman's Community of Businesses: New Business Development case study are - Strategic Management Strategies, Human resource management, Organizational culture and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Zingerman's Community of Businesses: New Business Development casestudy better are - – geopolitical disruptions, increasing transportation and logistics costs, wage bills are increasing, supply chains are disrupted by pandemic , banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing inequality as vast percentage of new income is going to the top 1%, increasing government debt because of Covid-19 spendings,
challanges to central banks by blockchain based private currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
Introduction to SWOT Analysis of Zingerman's Community of Businesses: New Business Development
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Zingerman's Community of Businesses: New Business Development case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Zingerman's Businesses, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Zingerman's Businesses 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 Zingerman's Community of Businesses: New Business Development can be done for the following purposes –
1. Strategic planning using facts provided in Zingerman's Community of Businesses: New Business Development case study
2. Improving business portfolio management of Zingerman's Businesses
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 Zingerman's Businesses
Strengths Zingerman's Community of Businesses: New Business Development | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Zingerman's Businesses in Zingerman's Community of Businesses: New Business Development Harvard Business Review case study are -
Training and development
– Zingerman's Businesses has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Zingerman's Community of Businesses: New Business Development 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.
Superior customer experience
– The customer experience strategy of Zingerman's Businesses in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Operational resilience
– The operational resilience strategy in the Zingerman's Community of Businesses: New Business Development 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.
Strong track record of project management
– Zingerman's Businesses is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Learning organization
- Zingerman's Businesses 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 Zingerman's Businesses is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Zingerman's Community of Businesses: New Business Development Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Zingerman's Businesses is present in almost all the verticals within the industry. This has provided firm in Zingerman's Community of Businesses: New Business Development 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.
Analytics focus
– Zingerman's Businesses 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 Wayne Baker 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.
Low bargaining power of suppliers
– Suppliers of Zingerman's Businesses in the sector have low bargaining power. Zingerman's Community of Businesses: New Business Development has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Zingerman's Businesses to manage not only supply disruptions but also source products at highly competitive prices.
Effective Research and Development (R&D)
– Zingerman's Businesses 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 Zingerman's Community of Businesses: New Business Development - 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
– Zingerman's Businesses has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Zingerman's Businesses 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.
Ability to lead change in Leadership & Managing People field
– Zingerman's Businesses 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 Zingerman's Businesses in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Ability to recruit top talent
– Zingerman's Businesses is one of the leading recruiters in the industry. Managers in the Zingerman's Community of Businesses: New Business Development are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Weaknesses Zingerman's Community of Businesses: New Business Development | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Zingerman's Community of Businesses: New Business Development are -
Lack of clear differentiation of Zingerman's Businesses products
– To increase the profitability and margins on the products, Zingerman's Businesses needs to provide more differentiated products than what it is currently offering in the marketplace.
Skills based hiring
– The stress on hiring functional specialists at Zingerman's Businesses 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.
Slow decision making process
– As mentioned earlier in the report, Zingerman's Businesses 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. Zingerman's Businesses 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 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 Zingerman's Businesses supply chain. Even after few cautionary changes mentioned in the HBR case study - Zingerman's Community of Businesses: New Business Development, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Zingerman's Businesses vulnerable to further global disruptions in South East Asia.
Aligning sales with marketing
– It come across in the case study Zingerman's Community of Businesses: New Business Development 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 Zingerman's Community of Businesses: New Business Development can leverage the sales team experience to cultivate customer relationships as Zingerman's Businesses is planning to shift buying processes online.
High bargaining power of channel partners
– Because of the regulatory requirements, Wayne Baker suggests that, Zingerman's Businesses is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Capital Spending Reduction
– Even during the low interest decade, Zingerman's Businesses 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.
Need for greater diversity
– Zingerman's Businesses 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.
No frontier risks strategy
– After analyzing the HBR case study Zingerman's Community of Businesses: New Business Development, it seems that company is thinking about the frontier risks that can impact Leadership & Managing People 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.
Products dominated business model
– Even though Zingerman's Businesses has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Zingerman's Community of Businesses: New Business Development should strive to include more intangible value offerings along with its core products and services.
Slow to strategic competitive environment developments
– As Zingerman's Community of Businesses: New Business Development HBR case study mentions - Zingerman's Businesses 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.
Opportunities Zingerman's Community of Businesses: New Business Development | 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 Zingerman's Community of Businesses: New Business Development are -
Building a culture of innovation
– managers at Zingerman's Businesses 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.
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 Zingerman's Businesses in the consumer business. Now Zingerman's Businesses can target international markets with far fewer capital restrictions requirements than the existing system.
Buying journey improvements
– Zingerman's Businesses can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Zingerman's Community of Businesses: New Business Development 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.
Developing new processes and practices
– Zingerman's Businesses can develop new processes and procedures in Leadership & Managing People 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Zingerman's Businesses can use these opportunities to build new business models that can help the communities that Zingerman's Businesses operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Zingerman's Businesses in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Leadership & Managing People segment, and it will provide faster access to the consumers.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Zingerman's Businesses can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Zingerman's Businesses 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 Zingerman's Businesses to hire the very best people irrespective of their geographical location.
Creating value in data economy
– The success of analytics program of Zingerman's Businesses has opened avenues for new revenue streams for the organization in the industry. This can help Zingerman's Businesses to build a more holistic ecosystem as suggested in the Zingerman's Community of Businesses: New Business Development case study. Zingerman's Businesses can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Low interest rates
– Even though inflation is raising its head in most developed economies, Zingerman's Businesses 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.
Leveraging digital technologies
– Zingerman's Businesses 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Zingerman's Businesses is facing challenges because of the dominance of functional experts in the organization. Zingerman's Community of Businesses: New Business Development 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 Leadership & Managing People industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Zingerman's Businesses 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. Zingerman's Businesses 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 Zingerman's Community of Businesses: New Business Development External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Zingerman's Community of Businesses: New Business Development are -
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. Zingerman's Businesses needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Zingerman's Businesses with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Technology acceleration in Forth Industrial Revolution
– Zingerman's Businesses has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Zingerman's Businesses 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.
Environmental challenges
– Zingerman's Businesses 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. Zingerman's Businesses can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Regulatory challenges
– Zingerman's Businesses 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.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Zingerman's Businesses in the Leadership & Managing People sector and impact the bottomline of the organization.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Zingerman's Community of Businesses: New Business Development, Zingerman's Businesses may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Leadership & Managing People .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Zingerman's Businesses 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.
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. Zingerman's Businesses 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.
Stagnating economy with rate increase
– Zingerman's Businesses 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 Zingerman's Businesses.
Weighted SWOT Analysis of Zingerman's Community of Businesses: New Business Development 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 Zingerman's Community of Businesses: New Business Development 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 Zingerman's Community of Businesses: New Business Development 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 Zingerman's Community of Businesses: New Business Development 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 Zingerman's Community of Businesses: New Business Development 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 Zingerman's Businesses needs to make to build a sustainable competitive advantage.