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 - – increasing energy prices, talent flight as more people leaving formal jobs, geopolitical disruptions, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing commodity prices, increasing household debt because of falling income levels, customer relationship management is fast transforming because of increasing concerns over data privacy,
technology disruption, there is backlash against globalization, 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 -
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.
Effective Research and Development (R&D)
– Aiaca Craftworkers 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 AIACA: Interventions for Sustainable Livelihoods - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Strong track record of project management
– Aiaca Craftworkers is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
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.
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.
Low bargaining power of suppliers
– Suppliers of Aiaca Craftworkers in the sector have low bargaining power. AIACA: Interventions for Sustainable Livelihoods has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Aiaca Craftworkers to manage not only supply disruptions but also source products at highly competitive prices.
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.
Operational resilience
– The operational resilience strategy in the AIACA: Interventions for Sustainable Livelihoods 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.
Cross disciplinary teams
– Horizontal connected teams at the Aiaca Craftworkers 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.
Analytics focus
– Aiaca Craftworkers 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 Sonu Goyal 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 switching costs
– The high switching costs that Aiaca Craftworkers 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.
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.
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 -
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.
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.
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.
High bargaining power of channel partners
– Because of the regulatory requirements, Sonu Goyal suggests that, Aiaca Craftworkers 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.
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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Aiaca Craftworkers is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study AIACA: Interventions for Sustainable Livelihoods 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 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.
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.
Skills based hiring
– The stress on hiring functional specialists at Aiaca Craftworkers 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.
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 -
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.
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.
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.
Creating value in data economy
– The success of analytics program of Aiaca Craftworkers has opened avenues for new revenue streams for the organization in the industry. This can help Aiaca Craftworkers to build a more holistic ecosystem as suggested in the AIACA: Interventions for Sustainable Livelihoods case study. Aiaca Craftworkers can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Aiaca Craftworkers 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Aiaca Craftworkers can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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.
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.
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.
Manufacturing automation
– Aiaca Craftworkers 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.
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.
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.
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.
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 -
Consumer confidence and its impact on Aiaca Craftworkers 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.
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.
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 .
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.
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.
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.
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.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Aiaca Craftworkers with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
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.
Regulatory challenges
– Aiaca Craftworkers 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.
High dependence on third party suppliers
– Aiaca Craftworkers 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.
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.