Case Study Description of Himachal Fertilizer Corporation (C): An Ethical Conundrum
Supplement to case NA0409. This case series provides a platform to discuss a broad range of interconnected issues relating to corporate governance, ethical reasoning and giving voice to values in a real-world decision-making context. An independent director (Neil Shah) on the board of directors of National Petroleum Corporation (NPC) is approached by a bidder, Western India Ports Limited (WIPL). Through an unwarranted last minute change in the bidding process, WIPL's bid for handling of Naphtha for NPC's upcoming refinery has been rejected. Neil learns from WIPL that its competitor, Bharat Ports Limited (BPL), may have bribed an NPC official to create a situation that would disqualify WIPL's bid. As a result, only one bidder (BPL) is left in the fray. Neil questions the process followed by NPC, without disclosing that an executive from WIPL had met him about the change in the process. Neil's questioning corrects the situation. WIPL is not only able to participate in the bid, but even wins the NPC contract. However, Neil's joy of righting the wrong is short-lived. A few months after the episode, and after stepping down from the board, Neil learns that the NPC official who had attempted to disqualify WIPL had been recruited by WIPL after his retirement from NPC. Soon after discovering this, Neil himself is approached by WIPL with a proposal to transfer 5000 shares from their holding to Neil, without any payment, as a mark of their gratitude to him. Should Neil accept the gift? Would that be akin to accepting bribe? Should Neil be disturbed by the knowledge that the concerned NPC executive had joined WIPL after retirement from NPC? The cases highlight the ethical dilemmas that individuals face and present challenges in finding a way out of a maze of issues without compromising personal values while protecting interests of the organization. What are the principles of governance that must not be compromised? What are the personal values that must be upheld? How should an individual navigate the organizational processes so as to make one's voice heard? How does one deal with conflicting resolutions provided by different ethical principles?
Swot Analysis of "Himachal Fertilizer Corporation (C): An Ethical Conundrum" written by Samir K Barua, Mahendra R Gujarathi includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Npc Wipl facing as an external strategic factors. Some of the topics covered in Himachal Fertilizer Corporation (C): An Ethical Conundrum case study are - Strategic Management Strategies, Ethics and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Himachal Fertilizer Corporation (C): An Ethical Conundrum casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, increasing transportation and logistics costs, increasing energy prices, competitive advantages are harder to sustain because of technology dispersion, supply chains are disrupted by pandemic , talent flight as more people leaving formal jobs, banking and financial system is disrupted by Bitcoin and other crypto currencies,
increasing household debt because of falling income levels, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of Himachal Fertilizer Corporation (C): An Ethical Conundrum
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Himachal Fertilizer Corporation (C): An Ethical Conundrum case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Npc Wipl, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Npc Wipl 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 Himachal Fertilizer Corporation (C): An Ethical Conundrum can be done for the following purposes –
1. Strategic planning using facts provided in Himachal Fertilizer Corporation (C): An Ethical Conundrum case study
2. Improving business portfolio management of Npc Wipl
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 Npc Wipl
Strengths Himachal Fertilizer Corporation (C): An Ethical Conundrum | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Npc Wipl in Himachal Fertilizer Corporation (C): An Ethical Conundrum Harvard Business Review case study are -
Effective Research and Development (R&D)
– Npc Wipl 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 Himachal Fertilizer Corporation (C): An Ethical Conundrum - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Operational resilience
– The operational resilience strategy in the Himachal Fertilizer Corporation (C): An Ethical Conundrum 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.
Superior customer experience
– The customer experience strategy of Npc Wipl in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Analytics focus
– Npc Wipl 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 Samir K Barua, Mahendra R Gujarathi 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.
High brand equity
– Npc Wipl has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Npc Wipl to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Npc Wipl is present in almost all the verticals within the industry. This has provided firm in Himachal Fertilizer Corporation (C): An Ethical Conundrum 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.
High switching costs
– The high switching costs that Npc Wipl 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 lead change in Leadership & Managing People field
– Npc Wipl 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 Npc Wipl in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Sustainable margins compare to other players in Leadership & Managing People industry
– Himachal Fertilizer Corporation (C): An Ethical Conundrum firm has clearly differentiated products in the market place. This has enabled Npc Wipl to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Npc Wipl to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– Npc Wipl 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 Himachal Fertilizer Corporation (C): An Ethical Conundrum HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Low bargaining power of suppliers
– Suppliers of Npc Wipl in the sector have low bargaining power. Himachal Fertilizer Corporation (C): An Ethical Conundrum has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Npc Wipl to manage not only supply disruptions but also source products at highly competitive prices.
Ability to recruit top talent
– Npc Wipl is one of the leading recruiters in the industry. Managers in the Himachal Fertilizer Corporation (C): An Ethical Conundrum 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 Himachal Fertilizer Corporation (C): An Ethical Conundrum | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Himachal Fertilizer Corporation (C): An Ethical Conundrum are -
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Himachal Fertilizer Corporation (C): An Ethical Conundrum, it seems that the employees of Npc Wipl 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.
Aligning sales with marketing
– It come across in the case study Himachal Fertilizer Corporation (C): An Ethical Conundrum 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 Himachal Fertilizer Corporation (C): An Ethical Conundrum can leverage the sales team experience to cultivate customer relationships as Npc Wipl is planning to shift buying processes online.
Interest costs
– Compare to the competition, Npc Wipl 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 Npc Wipl 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 to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Npc Wipl is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Himachal Fertilizer Corporation (C): An Ethical Conundrum can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Himachal Fertilizer Corporation (C): An Ethical Conundrum, is just above the industry average. Npc Wipl 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.
Capital Spending Reduction
– Even during the low interest decade, Npc Wipl 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.
Lack of clear differentiation of Npc Wipl products
– To increase the profitability and margins on the products, Npc Wipl needs to provide more differentiated products than what it is currently offering in the marketplace.
Increasing silos among functional specialists
– The organizational structure of Npc Wipl is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Npc Wipl needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Npc Wipl to focus more on services rather than just following the product oriented approach.
High operating costs
– Compare to the competitors, firm in the HBR case study Himachal Fertilizer Corporation (C): An Ethical Conundrum 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 Npc Wipl 's lucrative customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Npc Wipl 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.
Opportunities Himachal Fertilizer Corporation (C): An Ethical Conundrum | 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 Himachal Fertilizer Corporation (C): An Ethical Conundrum are -
Manufacturing automation
– Npc Wipl can use the latest technology developments to improve its manufacturing and designing process in Leadership & Managing People segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Building a culture of innovation
– managers at Npc Wipl 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Npc Wipl can use these opportunities to build new business models that can help the communities that Npc Wipl operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Loyalty marketing
– Npc Wipl 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Npc Wipl 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, Himachal Fertilizer Corporation (C): An Ethical Conundrum, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Npc Wipl 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 Npc Wipl 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 Npc Wipl to hire the very best people irrespective of their geographical location.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Npc Wipl is facing challenges because of the dominance of functional experts in the organization. Himachal Fertilizer Corporation (C): An Ethical Conundrum 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.
Buying journey improvements
– Npc Wipl can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Himachal Fertilizer Corporation (C): An Ethical Conundrum 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.
Better consumer reach
– The expansion of the 5G network will help Npc Wipl to increase its market reach. Npc Wipl 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.
Leveraging digital technologies
– Npc Wipl 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.
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 Npc Wipl 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. Npc Wipl can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats Himachal Fertilizer Corporation (C): An Ethical Conundrum External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Himachal Fertilizer Corporation (C): An Ethical Conundrum are -
Environmental challenges
– Npc Wipl 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. Npc Wipl can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Consumer confidence and its impact on Npc Wipl 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.
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 Npc Wipl.
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 Npc Wipl business can come under increasing regulations regarding data privacy, data security, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Npc Wipl 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.
High dependence on third party suppliers
– Npc Wipl 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.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Increasing wage structure of Npc Wipl
– 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 Npc Wipl.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Npc Wipl with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Npc Wipl can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Shortening product life cycle
– it is one of the major threat that Npc Wipl is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Npc Wipl 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 Himachal Fertilizer Corporation (C): An Ethical Conundrum .
Regulatory challenges
– Npc Wipl 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.
Weighted SWOT Analysis of Himachal Fertilizer Corporation (C): An Ethical Conundrum 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 Himachal Fertilizer Corporation (C): An Ethical Conundrum 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 Himachal Fertilizer Corporation (C): An Ethical Conundrum 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 Himachal Fertilizer Corporation (C): An Ethical Conundrum 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 Himachal Fertilizer Corporation (C): An Ethical Conundrum 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 Npc Wipl needs to make to build a sustainable competitive advantage.
