A Terroir Olive Oil Mill Against Agri-Food Multinationals SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of A Terroir Olive Oil Mill Against Agri-Food Multinationals
The chief executive officer of Les Moulins de la Brague (LMB), a seven-generation French olive oil miller, was worried about the future of the business. LMB was trying to find a profitable niche in a market that was filled with multinational companies, whose products came in a variety of quality and price ranges, and filled the shelves of French grocery stores. Although LMB had achieved critical acclaim for its blended olive oils made with spices and flavours, the business was unstable for a number of reasons. First, weather conditions had caused a decrease in the number of olives harvested. Second, on the consumer front, shoppers' interest in the health benefits of olive oil, promoted by the popularity of the "Mediterranean diet" seemed to have peaked. Finally, the market was flooded with various levels of quality: low-quality brands with low prices; medium-quality brands that dominated consumer markets; and many high-end premium brands that were produced by olive mills just like LMB. With a market environment pressured in so many ways, how could LMB keep its 200-year-old millstones turning? Pierre-Xavier Meschi is affiliated with IAE Aix-En-Provence.
Authors :: Franck Brulhart, Philippe Chereau, Pierre-Xavier Meschi
Swot Analysis of "A Terroir Olive Oil Mill Against Agri-Food Multinationals" written by Franck Brulhart, Philippe Chereau, Pierre-Xavier Meschi includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Lmb Olive facing as an external strategic factors. Some of the topics covered in A Terroir Olive Oil Mill Against Agri-Food Multinationals case study are - Strategic Management Strategies, International business, Strategy and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the A Terroir Olive Oil Mill Against Agri-Food Multinationals casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, digital marketing is dominated by two big players Facebook and Google, competitive advantages are harder to sustain because of technology dispersion, challanges to central banks by blockchain based private currencies, supply chains are disrupted by pandemic , banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing commodity prices,
there is backlash against globalization, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of A Terroir Olive Oil Mill Against Agri-Food Multinationals
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in A Terroir Olive Oil Mill Against Agri-Food Multinationals case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Lmb Olive, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Lmb Olive 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 A Terroir Olive Oil Mill Against Agri-Food Multinationals can be done for the following purposes –
1. Strategic planning using facts provided in A Terroir Olive Oil Mill Against Agri-Food Multinationals case study
2. Improving business portfolio management of Lmb Olive
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 Lmb Olive
Strengths A Terroir Olive Oil Mill Against Agri-Food Multinationals | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Lmb Olive in A Terroir Olive Oil Mill Against Agri-Food Multinationals Harvard Business Review case study are -
Diverse revenue streams
– Lmb Olive is present in almost all the verticals within the industry. This has provided firm in A Terroir Olive Oil Mill Against Agri-Food Multinationals 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.
Organizational Resilience of Lmb Olive
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Lmb Olive does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Superior customer experience
– The customer experience strategy of Lmb Olive in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to lead change in Leadership & Managing People field
– Lmb Olive 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 Lmb Olive in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Lmb Olive digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Lmb Olive 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.
Highly skilled collaborators
– Lmb Olive 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 A Terroir Olive Oil Mill Against Agri-Food Multinationals HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Lmb Olive is one of the most innovative firm in sector. Manager in A Terroir Olive Oil Mill Against Agri-Food Multinationals Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Learning organization
- Lmb Olive 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 Lmb Olive is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in A Terroir Olive Oil Mill Against Agri-Food Multinationals Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Training and development
– Lmb Olive has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in A Terroir Olive Oil Mill Against Agri-Food Multinationals 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.
High switching costs
– The high switching costs that Lmb Olive has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Ability to recruit top talent
– Lmb Olive is one of the leading recruiters in the industry. Managers in the A Terroir Olive Oil Mill Against Agri-Food Multinationals are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Effective Research and Development (R&D)
– Lmb Olive 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 A Terroir Olive Oil Mill Against Agri-Food Multinationals - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses A Terroir Olive Oil Mill Against Agri-Food Multinationals | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of A Terroir Olive Oil Mill Against Agri-Food Multinationals are -
Increasing silos among functional specialists
– The organizational structure of Lmb Olive is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Lmb Olive needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Lmb Olive to focus more on services rather than just following the product oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Lmb Olive 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.
Slow decision making process
– As mentioned earlier in the report, Lmb Olive 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. Lmb Olive 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, Lmb Olive is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study A Terroir Olive Oil Mill Against Agri-Food Multinationals can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Lmb Olive 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 Lmb Olive has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
High operating costs
– Compare to the competitors, firm in the HBR case study A Terroir Olive Oil Mill Against Agri-Food Multinationals 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 Lmb Olive 's lucrative customers.
Aligning sales with marketing
– It come across in the case study A Terroir Olive Oil Mill Against Agri-Food Multinationals 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 A Terroir Olive Oil Mill Against Agri-Food Multinationals can leverage the sales team experience to cultivate customer relationships as Lmb Olive is planning to shift buying processes online.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study A Terroir Olive Oil Mill Against Agri-Food Multinationals, is just above the industry average. Lmb Olive 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.
Interest costs
– Compare to the competition, Lmb Olive 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.
Low market penetration in new markets
– Outside its home market of Lmb Olive, firm in the HBR case study A Terroir Olive Oil Mill Against Agri-Food Multinationals needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Opportunities A Terroir Olive Oil Mill Against Agri-Food Multinationals | 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 A Terroir Olive Oil Mill Against Agri-Food Multinationals are -
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Leadership & Managing People industry, but it has also influenced the consumer preferences. Lmb Olive can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Low interest rates
– Even though inflation is raising its head in most developed economies, Lmb Olive 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.
Using analytics as competitive advantage
– Lmb Olive 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 A Terroir Olive Oil Mill Against Agri-Food Multinationals - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Lmb Olive to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Lmb Olive can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Lmb Olive 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Lmb Olive can use these opportunities to build new business models that can help the communities that Lmb Olive operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
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. Lmb Olive 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. Lmb Olive 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Lmb Olive 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.
Loyalty marketing
– Lmb Olive 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.
Developing new processes and practices
– Lmb Olive 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.
Learning at scale
– Online learning technologies has now opened space for Lmb Olive 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. Lmb Olive can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Lmb Olive 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 Lmb Olive to hire the very best people irrespective of their geographical location.
Threats A Terroir Olive Oil Mill Against Agri-Food Multinationals External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study A Terroir Olive Oil Mill Against Agri-Food Multinationals are -
High dependence on third party suppliers
– Lmb Olive 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.
Regulatory challenges
– Lmb Olive 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.
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 Lmb Olive in the Leadership & Managing People sector and impact the bottomline of the organization.
Easy access to finance
– Easy access to finance in Leadership & Managing People field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Lmb Olive can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Lmb Olive 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.
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. Lmb Olive 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
– Lmb Olive 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.
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 Lmb Olive business can come under increasing regulations regarding data privacy, data security, etc.
Consumer confidence and its impact on Lmb Olive 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.
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.
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.
Shortening product life cycle
– it is one of the major threat that Lmb Olive is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Lmb Olive 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.
Weighted SWOT Analysis of A Terroir Olive Oil Mill Against Agri-Food Multinationals 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 A Terroir Olive Oil Mill Against Agri-Food Multinationals 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 A Terroir Olive Oil Mill Against Agri-Food Multinationals 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 A Terroir Olive Oil Mill Against Agri-Food Multinationals 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 A Terroir Olive Oil Mill Against Agri-Food Multinationals 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 Lmb Olive needs to make to build a sustainable competitive advantage.
