DKSH in 2012: Preparing For Continued Rapid Growth SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of DKSH in 2012: Preparing For Continued Rapid Growth
The case discusses the post-IPO strategies, opportunities and challenges for Swiss global trading company DKSH, the leading market expansion (MES) provider with a focus on Asia. DKSH was well positioned to capitalize on three key MES industry trends: 1) Asia as the growth market per se, driven by the thriving middle classes of the emerging economies, 2) growing inner-Asian trade, and 3) the tendency of companies to outsource, stemming from the continuing focus on core competencies. DKSH wanted to use the tailwind of its very successful IPO and its strong growth potential to forcefully extend its number one market position while staying focused on implementing a sharply defined strategy for growth. From a strategic point of view, the company had to address multiple key issues: optimizing its business portfolio; further developing and centralizing corporate-level core competencies; choosing the right level of strategic integration of its four business units; strengthening its service innovation capability; ensuring the right resource allocation to sustain the company's growth engine; and sustaining its strategic entrepreneurial leadership culture.
Swot Analysis of "DKSH in 2012: Preparing For Continued Rapid Growth" written by Robert A. Burgelman, Martina Ludescher includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Dksh Mes facing as an external strategic factors. Some of the topics covered in DKSH in 2012: Preparing For Continued Rapid Growth case study are - Strategic Management Strategies, and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the DKSH in 2012: Preparing For Continued Rapid Growth casestudy better are - – increasing household debt because of falling income levels, increasing commodity prices, increasing transportation and logistics costs, digital marketing is dominated by two big players Facebook and Google, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing government debt because of Covid-19 spendings, customer relationship management is fast transforming because of increasing concerns over data privacy,
increasing energy prices, wage bills are increasing, etc
Introduction to SWOT Analysis of DKSH in 2012: Preparing For Continued Rapid Growth
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in DKSH in 2012: Preparing For Continued Rapid Growth case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Dksh Mes, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Dksh Mes 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 DKSH in 2012: Preparing For Continued Rapid Growth can be done for the following purposes –
1. Strategic planning using facts provided in DKSH in 2012: Preparing For Continued Rapid Growth case study
2. Improving business portfolio management of Dksh Mes
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 Dksh Mes
Strengths DKSH in 2012: Preparing For Continued Rapid Growth | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Dksh Mes in DKSH in 2012: Preparing For Continued Rapid Growth Harvard Business Review case study are -
Superior customer experience
– The customer experience strategy of Dksh Mes in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Effective Research and Development (R&D)
– Dksh Mes 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 DKSH in 2012: Preparing For Continued Rapid Growth - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Dksh Mes digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Dksh Mes 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.
Diverse revenue streams
– Dksh Mes is present in almost all the verticals within the industry. This has provided firm in DKSH in 2012: Preparing For Continued Rapid Growth 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.
Operational resilience
– The operational resilience strategy in the DKSH in 2012: Preparing For Continued Rapid Growth 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 recruit top talent
– Dksh Mes is one of the leading recruiters in the industry. Managers in the DKSH in 2012: Preparing For Continued Rapid Growth are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Successful track record of launching new products
– Dksh Mes has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Dksh Mes 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.
High switching costs
– The high switching costs that Dksh Mes 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.
High brand equity
– Dksh Mes has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Dksh Mes to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– Dksh Mes is one of the most innovative firm in sector. Manager in DKSH in 2012: Preparing For Continued Rapid Growth 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
– Dksh Mes is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Training and development
– Dksh Mes has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in DKSH in 2012: Preparing For Continued Rapid Growth 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.
Weaknesses DKSH in 2012: Preparing For Continued Rapid Growth | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of DKSH in 2012: Preparing For Continued Rapid Growth are -
High bargaining power of channel partners
– Because of the regulatory requirements, Robert A. Burgelman, Martina Ludescher suggests that, Dksh Mes 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Dksh Mes is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study DKSH in 2012: Preparing For Continued Rapid Growth can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
High cash cycle compare to competitors
Dksh Mes 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.
Aligning sales with marketing
– It come across in the case study DKSH in 2012: Preparing For Continued Rapid Growth 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 DKSH in 2012: Preparing For Continued Rapid Growth can leverage the sales team experience to cultivate customer relationships as Dksh Mes is planning to shift buying processes online.
Interest costs
– Compare to the competition, Dksh Mes 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.
Need for greater diversity
– Dksh Mes 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.
Capital Spending Reduction
– Even during the low interest decade, Dksh Mes 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study DKSH in 2012: Preparing For Continued Rapid Growth, is just above the industry average. Dksh Mes 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.
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 Dksh Mes supply chain. Even after few cautionary changes mentioned in the HBR case study - DKSH in 2012: Preparing For Continued Rapid Growth, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Dksh Mes vulnerable to further global disruptions in South East Asia.
Products dominated business model
– Even though Dksh Mes 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 - DKSH in 2012: Preparing For Continued Rapid Growth should strive to include more intangible value offerings along with its core products and services.
Lack of clear differentiation of Dksh Mes products
– To increase the profitability and margins on the products, Dksh Mes needs to provide more differentiated products than what it is currently offering in the marketplace.
Opportunities DKSH in 2012: Preparing For Continued Rapid Growth | 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 DKSH in 2012: Preparing For Continued Rapid Growth are -
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. Dksh Mes 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. Dksh Mes 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.
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 Dksh Mes 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, Dksh Mes can use these opportunities to build new business models that can help the communities that Dksh Mes operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Dksh Mes 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.
Using analytics as competitive advantage
– Dksh Mes 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 DKSH in 2012: Preparing For Continued Rapid Growth - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Dksh Mes to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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 Dksh Mes in the consumer business. Now Dksh Mes 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, Dksh Mes 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.
Better consumer reach
– The expansion of the 5G network will help Dksh Mes to increase its market reach. Dksh Mes 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 Dksh Mes 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.
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. Dksh Mes 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
– Dksh Mes 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.
Buying journey improvements
– Dksh Mes can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. DKSH in 2012: Preparing For Continued Rapid Growth 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 Dksh Mes has opened avenues for new revenue streams for the organization in the industry. This can help Dksh Mes to build a more holistic ecosystem as suggested in the DKSH in 2012: Preparing For Continued Rapid Growth case study. Dksh Mes can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats DKSH in 2012: Preparing For Continued Rapid Growth External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study DKSH in 2012: Preparing For Continued Rapid Growth are -
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. Dksh Mes 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 dependence on third party suppliers
– Dksh Mes 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.
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 Dksh Mes.
Environmental challenges
– Dksh Mes 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. Dksh Mes can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
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. Dksh Mes needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Dksh Mes 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 DKSH in 2012: Preparing For Continued Rapid Growth .
Stagnating economy with rate increase
– Dksh Mes 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.
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 Dksh Mes in the Leadership & Managing People sector and impact the bottomline of the organization.
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.
Regulatory challenges
– Dksh Mes 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.
Consumer confidence and its impact on Dksh Mes 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Dksh Mes 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Dksh Mes with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Weighted SWOT Analysis of DKSH in 2012: Preparing For Continued Rapid Growth 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 DKSH in 2012: Preparing For Continued Rapid Growth 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 DKSH in 2012: Preparing For Continued Rapid Growth 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 DKSH in 2012: Preparing For Continued Rapid Growth 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 DKSH in 2012: Preparing For Continued Rapid Growth 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 Dksh Mes needs to make to build a sustainable competitive advantage.