Case Study Description of AIACA: Interventions for Sustainable Livelihoods
In 2003, the All India Artisans and Craftworkers Welfare Association (AIACA) was launched to explore new and commercially sustainable models of livelihood promotion for India's vulnerable communities of craftworkers. The Indian handlooms and handicrafts, collectively referred to as the craft sector, symbolized the rich historical and cultural diversity that distinguished India from the rest of the world. The sector provided low-cost, "green" livelihood opportunities to millions of Indian families, supplementing their incomes in seasons of agrarian distress, checking migration, and preserving traditional economic relationships. The sector represented the economic lifeline of the most vulnerable sections of Indian society. AIACA took a unique approach towards stakeholder engagement by establishing partnerships with local non-governmental organizations, business enterprises, individual craftworkers, self-help groups, and government agencies. This level of co-operation produced effective advocacy and high-impact developmental work through multiplicative strategies, and the results were scalable and replicable in the context of informal sectors in transitioning economies. AIACA had spent a decade successfully designing and implementing livelihood interventions to help small-scale, family-managed businesses evolve into sustainable enterprises and innovative networks. The organization now needed to re-examine its approach and look for ways to deliver a deeper developmental impact. Sonu Goyal is affiliated with International Management Institute.
Swot Analysis of "AIACA: Interventions for Sustainable Livelihoods" written by Sonu Goyal includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Aiaca Craftworkers facing as an external strategic factors. Some of the topics covered in AIACA: Interventions for Sustainable Livelihoods case study are - Strategic Management Strategies, International business and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the AIACA: Interventions for Sustainable Livelihoods casestudy better are - – competitive advantages are harder to sustain because of technology dispersion, there is backlash against globalization, there is increasing trade war between United States & China, increasing household debt because of falling income levels, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing energy prices, increasing government debt because of Covid-19 spendings,
talent flight as more people leaving formal jobs, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of AIACA: Interventions for Sustainable Livelihoods
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in AIACA: Interventions for Sustainable Livelihoods case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Aiaca Craftworkers, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Aiaca Craftworkers 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 AIACA: Interventions for Sustainable Livelihoods can be done for the following purposes –
1. Strategic planning using facts provided in AIACA: Interventions for Sustainable Livelihoods case study
2. Improving business portfolio management of Aiaca Craftworkers
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 Aiaca Craftworkers
Strengths AIACA: Interventions for Sustainable Livelihoods | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Aiaca Craftworkers in AIACA: Interventions for Sustainable Livelihoods Harvard Business Review case study are -
Diverse revenue streams
– Aiaca Craftworkers is present in almost all the verticals within the industry. This has provided firm in AIACA: Interventions for Sustainable Livelihoods 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.
Superior customer experience
– The customer experience strategy of Aiaca Craftworkers in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Aiaca Craftworkers digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Aiaca Craftworkers has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Highly skilled collaborators
– Aiaca Craftworkers 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 AIACA: Interventions for Sustainable Livelihoods HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– Aiaca Craftworkers has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Aiaca Craftworkers 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.
Training and development
– Aiaca Craftworkers has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in AIACA: Interventions for Sustainable Livelihoods 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
- Aiaca Craftworkers 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 Aiaca Craftworkers is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in AIACA: Interventions for Sustainable Livelihoods Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– Aiaca Craftworkers is one of the leading recruiters in the industry. Managers in the AIACA: Interventions for Sustainable Livelihoods are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Ability to lead change in Leadership & Managing People field
– Aiaca Craftworkers 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 Aiaca Craftworkers in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High brand equity
– Aiaca Craftworkers has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Aiaca Craftworkers to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– Aiaca Craftworkers is one of the most innovative firm in sector. Manager in AIACA: Interventions for Sustainable Livelihoods Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Sustainable margins compare to other players in Leadership & Managing People industry
– AIACA: Interventions for Sustainable Livelihoods firm has clearly differentiated products in the market place. This has enabled Aiaca Craftworkers to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Aiaca Craftworkers to invest into research and development (R&D) and innovation.
Weaknesses AIACA: Interventions for Sustainable Livelihoods | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of AIACA: Interventions for Sustainable Livelihoods are -
High cash cycle compare to competitors
Aiaca Craftworkers 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study AIACA: Interventions for Sustainable Livelihoods, is just above the industry average. Aiaca Craftworkers 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.
Need for greater diversity
– Aiaca Craftworkers 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.
Slow decision making process
– As mentioned earlier in the report, Aiaca Craftworkers 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. Aiaca Craftworkers 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.
Capital Spending Reduction
– Even during the low interest decade, Aiaca Craftworkers 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.
High operating costs
– Compare to the competitors, firm in the HBR case study AIACA: Interventions for Sustainable Livelihoods 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 Aiaca Craftworkers 's lucrative customers.
Interest costs
– Compare to the competition, Aiaca Craftworkers has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Low market penetration in new markets
– Outside its home market of Aiaca Craftworkers, firm in the HBR case study AIACA: Interventions for Sustainable Livelihoods needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
No frontier risks strategy
– After analyzing the HBR case study AIACA: Interventions for Sustainable Livelihoods, it seems that company is thinking about the frontier risks that can impact Leadership & Managing People strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Aligning sales with marketing
– It come across in the case study AIACA: Interventions for Sustainable Livelihoods 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 AIACA: Interventions for Sustainable Livelihoods can leverage the sales team experience to cultivate customer relationships as Aiaca Craftworkers is planning to shift buying processes online.
Increasing silos among functional specialists
– The organizational structure of Aiaca Craftworkers is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Aiaca Craftworkers needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Aiaca Craftworkers to focus more on services rather than just following the product oriented approach.
Opportunities AIACA: Interventions for Sustainable Livelihoods | 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 AIACA: Interventions for Sustainable Livelihoods are -
Low interest rates
– Even though inflation is raising its head in most developed economies, Aiaca Craftworkers can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Using analytics as competitive advantage
– Aiaca Craftworkers 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 AIACA: Interventions for Sustainable Livelihoods - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Aiaca Craftworkers to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Aiaca Craftworkers can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 Aiaca Craftworkers 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.
Learning at scale
– Online learning technologies has now opened space for Aiaca Craftworkers 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.
Developing new processes and practices
– Aiaca Craftworkers 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.
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. Aiaca Craftworkers 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. Aiaca Craftworkers 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.
Better consumer reach
– The expansion of the 5G network will help Aiaca Craftworkers to increase its market reach. Aiaca Craftworkers 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Aiaca Craftworkers 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 Aiaca Craftworkers to hire the very best people irrespective of their geographical location.
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. Aiaca Craftworkers can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Aiaca Craftworkers 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, AIACA: Interventions for Sustainable Livelihoods, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Aiaca Craftworkers can use these opportunities to build new business models that can help the communities that Aiaca Craftworkers operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
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 Aiaca Craftworkers in the consumer business. Now Aiaca Craftworkers can target international markets with far fewer capital restrictions requirements than the existing system.
Threats AIACA: Interventions for Sustainable Livelihoods External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study AIACA: Interventions for Sustainable Livelihoods are -
Increasing wage structure of Aiaca Craftworkers
– 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 Aiaca Craftworkers.
Stagnating economy with rate increase
– Aiaca Craftworkers 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 Aiaca Craftworkers in the Leadership & Managing People sector and impact the bottomline of the organization.
Shortening product life cycle
– it is one of the major threat that Aiaca Craftworkers is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Aiaca Craftworkers 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Aiaca Craftworkers 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study AIACA: Interventions for Sustainable Livelihoods, Aiaca Craftworkers 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 international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Aiaca Craftworkers 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 AIACA: Interventions for Sustainable Livelihoods .
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. Aiaca Craftworkers can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Aiaca Craftworkers needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Technology acceleration in Forth Industrial Revolution
– Aiaca Craftworkers has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Aiaca Craftworkers needs to keep up with the evolution of technology in the Leadership & Managing People 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.
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 Aiaca Craftworkers.
Environmental challenges
– Aiaca Craftworkers 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. Aiaca Craftworkers can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Weighted SWOT Analysis of AIACA: Interventions for Sustainable Livelihoods 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 AIACA: Interventions for Sustainable Livelihoods 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 AIACA: Interventions for Sustainable Livelihoods 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 AIACA: Interventions for Sustainable Livelihoods 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 AIACA: Interventions for Sustainable Livelihoods 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 Aiaca Craftworkers needs to make to build a sustainable competitive advantage.