Case Study Description of Standards for Child Sponsorship Agencies (A)
In the spring of 1998, nonprofit agencies known as "child-sponsorship" organizations found themselves on the defensive. The agencies-dedicated to raising charitable funds in the United States to support children and their communities in poor, developing countries-had been the subject of a scathing critique, a two-part series in the Chicago Tribune accusing them, in effect, of misleading donors. The series asserted that the organizations had not lived up to the promise implicit in fundraising advertisements: that specific children would benefit directly from the contributions of individual sponsors. The agencies mounted a spirited and largely successful public defense of their approach-one in which aid was targeted not only at individual children but at the communities in which they lived. At the same time, however, they sought new ways to reassure the public about their effectiveness. This case details the ensuing effort by a group of six child sponsorship agencies to agree on "industry" standards that would make their goals and methods clear. The case describes the differing situations of the various organizations so as to lay the groundwork for discussion about likely difficulties in reaching agreement on standards, as well as extrapolation as to what sort of standards could both command consensus among the agencies and satisfy public demands for "transparency." The case serves the broader purpose of framing the issues and dynamics of industry self-regulation more generally, particularly in a nonprofit context. See also, Part B (1665.0). HKS Case Number 1664.0
Swot Analysis of "Standards for Child Sponsorship Agencies (A)" written by Esther Scott, David Brown includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Agencies Child facing as an external strategic factors. Some of the topics covered in Standards for Child Sponsorship Agencies (A) case study are - Strategic Management Strategies, Emerging markets, Human resource management, Marketing, Organizational culture, Project management, Social enterprise, Strategic planning and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Standards for Child Sponsorship Agencies (A) casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, central banks are concerned over increasing inflation, increasing transportation and logistics costs, increasing inequality as vast percentage of new income is going to the top 1%, there is increasing trade war between United States & China, talent flight as more people leaving formal jobs, increasing commodity prices,
customer relationship management is fast transforming because of increasing concerns over data privacy, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Standards for Child Sponsorship Agencies (A)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Standards for Child Sponsorship Agencies (A) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Agencies Child, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Agencies Child 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 Standards for Child Sponsorship Agencies (A) can be done for the following purposes –
1. Strategic planning using facts provided in Standards for Child Sponsorship Agencies (A) case study
2. Improving business portfolio management of Agencies Child
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 Agencies Child
Strengths Standards for Child Sponsorship Agencies (A) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Agencies Child in Standards for Child Sponsorship Agencies (A) Harvard Business Review case study are -
Analytics focus
– Agencies Child 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 Esther Scott, David Brown 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.
Organizational Resilience of Agencies Child
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Agencies Child does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High brand equity
– Agencies Child has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Agencies Child to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Highly skilled collaborators
– Agencies Child 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 Standards for Child Sponsorship Agencies (A) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Agencies Child digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Agencies Child 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.
High switching costs
– The high switching costs that Agencies Child 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.
Superior customer experience
– The customer experience strategy of Agencies Child in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Learning organization
- Agencies Child 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 Agencies Child is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Standards for Child Sponsorship Agencies (A) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Effective Research and Development (R&D)
– Agencies Child 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 Standards for Child Sponsorship Agencies (A) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to recruit top talent
– Agencies Child is one of the leading recruiters in the industry. Managers in the Standards for Child Sponsorship Agencies (A) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Diverse revenue streams
– Agencies Child is present in almost all the verticals within the industry. This has provided firm in Standards for Child Sponsorship Agencies (A) 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.
Cross disciplinary teams
– Horizontal connected teams at the Agencies Child 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.
Weaknesses Standards for Child Sponsorship Agencies (A) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Standards for Child Sponsorship Agencies (A) are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Standards for Child Sponsorship Agencies (A) HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Agencies Child has relatively successful track record of launching new products.
No frontier risks strategy
– After analyzing the HBR case study Standards for Child Sponsorship Agencies (A), 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.
Increasing silos among functional specialists
– The organizational structure of Agencies Child is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Agencies Child needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Agencies Child to focus more on services rather than just following the product oriented approach.
Aligning sales with marketing
– It come across in the case study Standards for Child Sponsorship Agencies (A) 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 Standards for Child Sponsorship Agencies (A) can leverage the sales team experience to cultivate customer relationships as Agencies Child is planning to shift buying processes online.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Standards for Child Sponsorship Agencies (A), in the dynamic environment Agencies Child has struggled to respond to the nimble upstart competition. Agencies Child has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High cash cycle compare to competitors
Agencies Child 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.
Interest costs
– Compare to the competition, Agencies Child 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 Agencies Child, firm in the HBR case study Standards for Child Sponsorship Agencies (A) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
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 Agencies Child supply chain. Even after few cautionary changes mentioned in the HBR case study - Standards for Child Sponsorship Agencies (A), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Agencies Child vulnerable to further global disruptions in South East Asia.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Standards for Child Sponsorship Agencies (A), is just above the industry average. Agencies Child 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.
Lack of clear differentiation of Agencies Child products
– To increase the profitability and margins on the products, Agencies Child needs to provide more differentiated products than what it is currently offering in the marketplace.
Opportunities Standards for Child Sponsorship Agencies (A) | 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 Standards for Child Sponsorship Agencies (A) are -
Loyalty marketing
– Agencies Child 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.
Developing new processes and practices
– Agencies Child 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Agencies Child 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 Agencies Child to hire the very best people irrespective of their geographical location.
Building a culture of innovation
– managers at Agencies Child 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.
Learning at scale
– Online learning technologies has now opened space for Agencies Child to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Agencies Child can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Buying journey improvements
– Agencies Child can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Standards for Child Sponsorship Agencies (A) 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.
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. Agencies Child 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. Agencies Child 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Agencies Child 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.
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. Agencies Child can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Low interest rates
– Even though inflation is raising its head in most developed economies, Agencies Child 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.
Creating value in data economy
– The success of analytics program of Agencies Child has opened avenues for new revenue streams for the organization in the industry. This can help Agencies Child to build a more holistic ecosystem as suggested in the Standards for Child Sponsorship Agencies (A) case study. Agencies Child can build new products and services such as - data insight services, data privacy related products, data based consulting services, 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 Agencies Child in the consumer business. Now Agencies Child can target international markets with far fewer capital restrictions requirements than the existing system.
Threats Standards for Child Sponsorship Agencies (A) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Standards for Child Sponsorship Agencies (A) are -
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.
Stagnating economy with rate increase
– Agencies Child 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.
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. Agencies Child 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.
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 Agencies Child business can come under increasing regulations regarding data privacy, data security, etc.
Shortening product life cycle
– it is one of the major threat that Agencies Child is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Standards for Child Sponsorship Agencies (A), Agencies Child 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 Agencies Child
– 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 Agencies Child.
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 Agencies Child.
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. Agencies Child needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Consumer confidence and its impact on Agencies Child 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Agencies Child 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Agencies Child 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.
Weighted SWOT Analysis of Standards for Child Sponsorship Agencies (A) 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 Standards for Child Sponsorship Agencies (A) 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 Standards for Child Sponsorship Agencies (A) 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 Standards for Child Sponsorship Agencies (A) 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 Standards for Child Sponsorship Agencies (A) 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 Agencies Child needs to make to build a sustainable competitive advantage.