PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study Description of PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES?
Anna had thought about investing in forests in the past, but she was not an expert in forestry or plantations and neither was her financial advisor, although he did say that it was a "great asset class for the wealthy, but not necessarily for ordinary citizens." Timberland, as an asset class, had generated average annual returns of 14.5% since 1972, beating the average returns of most stock markets over that period and on par with those generated by the private equity industry.Other claimed benefits included (1) solid returns over the long term; (2) nice diversification of a portfolio and an original risk/return profile; (3) lenient tax treatment of forest-related income; (4) a feel good factor about what you did for planet Earth. Additional factors played in favor of forestry investments, such as the flexibility to decide harvesting times based on market conditions for wood products, the ability to use long-term contracts to hedge against downturns and the multiple uses for the harvested products, from pulp and wood pallets to high quality wood panels. Timber also offered the ability to "warehouse" its value for long periods of time, as well as the ability to time the harvests to market conditions without suffering potential impairment due to technological or market obsolescence, like many other inventoried tangible assets. Finally, the reckless endangerment of natural forests around the world by so-called "wood pirates," either driven by greed or survival needs for cooking and heating material, called for action. Regular magazine articles and TV shows trumpeted the fact that the "lungs of the earth" in Southeast Asia and in the Amazon were at great risk of being destroyed by the greed of corrupt military officers, illegal loggers and international companies intent on making a quick buck at the cost of destroying fragile ecological systems. Learning objectives: Discuss timberland as an alternative asset class. Analyze two real investment opportunities offered in 2004. Discuss sustainable investment and the rules of engagement for profitable investment.
Swot Analysis of "PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES?" written by Benoit Leleux, Nir Berger includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Wood Forestry facing as an external strategic factors. Some of the topics covered in PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? case study are - Strategic Management Strategies, Financial management and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, challanges to central banks by blockchain based private currencies, central banks are concerned over increasing inflation, there is increasing trade war between United States & China, increasing transportation and logistics costs, supply chains are disrupted by pandemic , customer relationship management is fast transforming because of increasing concerns over data privacy,
competitive advantages are harder to sustain because of technology dispersion, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES?
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Wood Forestry, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Wood Forestry 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 PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? can be done for the following purposes –
1. Strategic planning using facts provided in PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? case study
2. Improving business portfolio management of Wood Forestry
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 Wood Forestry
Strengths PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Wood Forestry in PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? Harvard Business Review case study are -
Operational resilience
– The operational resilience strategy in the PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? 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.
Ability to lead change in Leadership & Managing People field
– Wood Forestry 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 Wood Forestry in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Effective Research and Development (R&D)
– Wood Forestry 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 PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Sustainable margins compare to other players in Leadership & Managing People industry
– PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? firm has clearly differentiated products in the market place. This has enabled Wood Forestry to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Wood Forestry to invest into research and development (R&D) and innovation.
Training and development
– Wood Forestry has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? 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.
Learning organization
- Wood Forestry 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 Wood Forestry is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– Wood Forestry is one of the leading recruiters in the industry. Managers in the PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Innovation driven organization
– Wood Forestry is one of the most innovative firm in sector. Manager in PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Strong track record of project management
– Wood Forestry is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Successful track record of launching new products
– Wood Forestry has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Wood Forestry 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.
Low bargaining power of suppliers
– Suppliers of Wood Forestry in the sector have low bargaining power. PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Wood Forestry to manage not only supply disruptions but also source products at highly competitive prices.
Highly skilled collaborators
– Wood Forestry 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 PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? are -
High cash cycle compare to competitors
Wood Forestry has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Slow decision making process
– As mentioned earlier in the report, Wood Forestry 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. Wood Forestry 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.
Aligning sales with marketing
– It come across in the case study PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? 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 PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? can leverage the sales team experience to cultivate customer relationships as Wood Forestry is planning to shift buying processes online.
Capital Spending Reduction
– Even during the low interest decade, Wood Forestry 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES?, in the dynamic environment Wood Forestry has struggled to respond to the nimble upstart competition. Wood Forestry has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Products dominated business model
– Even though Wood Forestry 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 - PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? should strive to include more intangible value offerings along with its core products and services.
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 Wood Forestry supply chain. Even after few cautionary changes mentioned in the HBR case study - PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES?, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Wood Forestry vulnerable to further global disruptions in South East Asia.
Need for greater diversity
– Wood Forestry 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Wood Forestry 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 Wood Forestry 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES?, it seems that the employees of Wood Forestry 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.
Opportunities PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? | 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 PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? are -
Developing new processes and practices
– Wood Forestry 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.
Manufacturing automation
– Wood Forestry 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.
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 Wood Forestry 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Wood Forestry is facing challenges because of the dominance of functional experts in the organization. PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? 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.
Loyalty marketing
– Wood Forestry 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Wood Forestry can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Wood Forestry in the consumer business. Now Wood Forestry can target international markets with far fewer capital restrictions requirements than the existing system.
Low interest rates
– Even though inflation is raising its head in most developed economies, Wood Forestry 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.
Buying journey improvements
– Wood Forestry can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? 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.
Creating value in data economy
– The success of analytics program of Wood Forestry has opened avenues for new revenue streams for the organization in the industry. This can help Wood Forestry to build a more holistic ecosystem as suggested in the PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? case study. Wood Forestry can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at Wood Forestry 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.
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. Wood Forestry can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Leveraging digital technologies
– Wood Forestry 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.
Threats PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? are -
Regulatory challenges
– Wood Forestry 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Wood Forestry 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 PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? .
High dependence on third party suppliers
– Wood Forestry 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.
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. Wood Forestry needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
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 Wood Forestry business can come under increasing regulations regarding data privacy, data security, etc.
Shortening product life cycle
– it is one of the major threat that Wood Forestry is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Wood Forestry with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
Environmental challenges
– Wood Forestry 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. Wood Forestry can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
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 Wood Forestry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES?, Wood Forestry 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 .
Increasing wage structure of Wood Forestry
– 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 Wood Forestry.
Stagnating economy with rate increase
– Wood Forestry 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.
Weighted SWOT Analysis of PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? 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 PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? 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 PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? 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 PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? 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 PRIME FORESTRY GROUP AND PRECIOUS WOODS (A): PULP FICTION OR MONEY GROWING ON TREES? 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 Wood Forestry needs to make to build a sustainable competitive advantage.
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