Clearwater Seafoods (Clearwater) is a seafood company located on the east coast of Canada. It is an income trust with operations around the world. As a result of the increasing value of the Canadian dollar relative to other currencies around the world, Clearwater has recently ceased paying its distributions. The case considers the decision faced by the chief financial officer to determine the strategy the firm should take to enable it to reinstate its distributions. This involves the choice between different financial and operational means to hedge the foreign exchange risk which brought the firm into its current situation.
Authors :: Stephen Sapp, Chandra Sekhar Ramasastry
Swot Analysis of "Clearwater Seafoods" written by Stephen Sapp, Chandra Sekhar Ramasastry includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Clearwater Seafoods facing as an external strategic factors. Some of the topics covered in Clearwater Seafoods case study are - Strategic Management Strategies, Risk management and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Clearwater Seafoods casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, competitive advantages are harder to sustain because of technology dispersion, there is backlash against globalization, cloud computing is disrupting traditional business models, increasing energy prices, increasing commodity prices, geopolitical disruptions,
customer relationship management is fast transforming because of increasing concerns over data privacy, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Clearwater Seafoods
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Clearwater Seafoods case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Clearwater Seafoods, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Clearwater Seafoods 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 Clearwater Seafoods can be done for the following purposes –
1. Strategic planning using facts provided in Clearwater Seafoods case study
2. Improving business portfolio management of Clearwater Seafoods
3. Assessing feasibility of the new initiative in Finance & Accounting field.
4. Making a Finance & Accounting topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Clearwater Seafoods
Strengths Clearwater Seafoods | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Clearwater Seafoods in Clearwater Seafoods Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of Clearwater Seafoods in the sector have low bargaining power. Clearwater Seafoods has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Clearwater Seafoods to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Clearwater Seafoods in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Clearwater Seafoods 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 Clearwater Seafoods HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Clearwater Seafoods is one of the most innovative firm in sector. Manager in Clearwater Seafoods Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Training and development
– Clearwater Seafoods has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Clearwater Seafoods 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.
Cross disciplinary teams
– Horizontal connected teams at the Clearwater Seafoods 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.
Diverse revenue streams
– Clearwater Seafoods is present in almost all the verticals within the industry. This has provided firm in Clearwater Seafoods 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 Clearwater Seafoods 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 Finance & Accounting field
– Clearwater Seafoods 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 Clearwater Seafoods 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 Finance & Accounting industry
– Clearwater Seafoods firm has clearly differentiated products in the market place. This has enabled Clearwater Seafoods to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Clearwater Seafoods to invest into research and development (R&D) and innovation.
Analytics focus
– Clearwater Seafoods 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 Stephen Sapp, Chandra Sekhar Ramasastry 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
– Clearwater Seafoods has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Clearwater Seafoods to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses Clearwater Seafoods | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Clearwater Seafoods are -
Need for greater diversity
– Clearwater Seafoods 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Clearwater Seafoods, it seems that the employees of Clearwater Seafoods 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 Clearwater Seafoods 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 Clearwater Seafoods can leverage the sales team experience to cultivate customer relationships as Clearwater Seafoods is planning to shift buying processes online.
High operating costs
– Compare to the competitors, firm in the HBR case study Clearwater Seafoods 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 Clearwater Seafoods 's lucrative customers.
Products dominated business model
– Even though Clearwater Seafoods 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 - Clearwater Seafoods should strive to include more intangible value offerings along with its core products and services.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Clearwater Seafoods, in the dynamic environment Clearwater Seafoods has struggled to respond to the nimble upstart competition. Clearwater Seafoods has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Clearwater Seafoods is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Clearwater Seafoods can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Lack of clear differentiation of Clearwater Seafoods products
– To increase the profitability and margins on the products, Clearwater Seafoods needs to provide more differentiated products than what it is currently offering in the marketplace.
High bargaining power of channel partners
– Because of the regulatory requirements, Stephen Sapp, Chandra Sekhar Ramasastry suggests that, Clearwater Seafoods 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Clearwater Seafoods 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 Clearwater Seafoods has relatively successful track record of launching new products.
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 Clearwater Seafoods supply chain. Even after few cautionary changes mentioned in the HBR case study - Clearwater Seafoods, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Clearwater Seafoods vulnerable to further global disruptions in South East Asia.
Opportunities Clearwater Seafoods | 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 Clearwater Seafoods are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Clearwater Seafoods can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Leveraging digital technologies
– Clearwater Seafoods 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.
Loyalty marketing
– Clearwater Seafoods 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, Clearwater Seafoods 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, Clearwater Seafoods, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Finance & Accounting industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Clearwater Seafoods 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. Clearwater Seafoods 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.
Buying journey improvements
– Clearwater Seafoods can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Clearwater Seafoods 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.
Building a culture of innovation
– managers at Clearwater Seafoods 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 Finance & Accounting segment.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Finance & Accounting industry, but it has also influenced the consumer preferences. Clearwater Seafoods can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Using analytics as competitive advantage
– Clearwater Seafoods 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 Clearwater Seafoods - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Clearwater Seafoods to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Better consumer reach
– The expansion of the 5G network will help Clearwater Seafoods to increase its market reach. Clearwater Seafoods 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.
Learning at scale
– Online learning technologies has now opened space for Clearwater Seafoods 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. Clearwater Seafoods can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Clearwater Seafoods can use these opportunities to build new business models that can help the communities that Clearwater Seafoods operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Threats Clearwater Seafoods External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Clearwater Seafoods are -
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.
High dependence on third party suppliers
– Clearwater Seafoods 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.
Environmental challenges
– Clearwater Seafoods 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. Clearwater Seafoods can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Stagnating economy with rate increase
– Clearwater Seafoods 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.
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. Clearwater Seafoods needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Clearwater Seafoods, Clearwater Seafoods may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Finance & Accounting .
Regulatory challenges
– Clearwater Seafoods 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 Finance & Accounting industry regulations.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Clearwater Seafoods 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
– Clearwater Seafoods has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Clearwater Seafoods needs to keep up with the evolution of technology in the Finance & Accounting 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.
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 Clearwater Seafoods in the Finance & Accounting sector and impact the bottomline of the organization.
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 Clearwater Seafoods.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Clearwater Seafoods 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 Clearwater Seafoods .
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.
Weighted SWOT Analysis of Clearwater Seafoods 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 Clearwater Seafoods 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 Clearwater Seafoods 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 Clearwater Seafoods 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 Clearwater Seafoods 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 Clearwater Seafoods needs to make to build a sustainable competitive advantage.