Amarnath Gupta and Sons: The Family Business SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Amarnath Gupta and Sons: The Family Business
Amarnath Gupta and Sons was a distributor of lubricants and owner of a petrol pump based in Alwar, Rajasthan, India. The business was originally set up as a family-owned single petrol pump in 1953. The family member currently in charge of daily operations had expanded the business significantly, especially since the entry of new multinational players in the Indian lubricant market. In 2013, this owner-partner was looking at ways to involve his children-one of whom had finished college (a son), one of whom was in college (a daughter), and one of whom was about to start college (a son)-in the family business. Should three businesses be established for each of the three children, or should they all be part of the same business? How could the next generation enter the business successfully? Professors Rajesh Panda, Pooja Gupta and Madhvi Sethi are affiliated with Symbiosis Institute of Business Management, Bengaluru (A constituent of Symbiosis International University, Pune).
Swot Analysis of "Amarnath Gupta and Sons: The Family Business" written by Rajesh Panda, Pooja Gupta, Madhvi Sethi includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Gupta Amarnath facing as an external strategic factors. Some of the topics covered in Amarnath Gupta and Sons: The Family Business case study are - Strategic Management Strategies, and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Amarnath Gupta and Sons: The Family Business casestudy better are - – technology disruption, central banks are concerned over increasing inflation, there is increasing trade war between United States & China, geopolitical disruptions, digital marketing is dominated by two big players Facebook and Google, increasing government debt because of Covid-19 spendings, increasing commodity prices,
competitive advantages are harder to sustain because of technology dispersion, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of Amarnath Gupta and Sons: The Family Business
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Amarnath Gupta and Sons: The Family Business case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Gupta Amarnath, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Gupta Amarnath 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 Amarnath Gupta and Sons: The Family Business can be done for the following purposes –
1. Strategic planning using facts provided in Amarnath Gupta and Sons: The Family Business case study
2. Improving business portfolio management of Gupta Amarnath
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 Gupta Amarnath
Strengths Amarnath Gupta and Sons: The Family Business | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Gupta Amarnath in Amarnath Gupta and Sons: The Family Business Harvard Business Review case study are -
Operational resilience
– The operational resilience strategy in the Amarnath Gupta and Sons: The Family Business 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.
Innovation driven organization
– Gupta Amarnath is one of the most innovative firm in sector. Manager in Amarnath Gupta and Sons: The Family Business Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Successful track record of launching new products
– Gupta Amarnath has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Gupta Amarnath 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.
Learning organization
- Gupta Amarnath 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 Gupta Amarnath is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Amarnath Gupta and Sons: The Family Business Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Gupta Amarnath is present in almost all the verticals within the industry. This has provided firm in Amarnath Gupta and Sons: The Family Business 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.
Sustainable margins compare to other players in Leadership & Managing People industry
– Amarnath Gupta and Sons: The Family Business firm has clearly differentiated products in the market place. This has enabled Gupta Amarnath to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Gupta Amarnath to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Gupta Amarnath 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.
Organizational Resilience of Gupta Amarnath
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Gupta Amarnath does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Gupta Amarnath digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Gupta Amarnath 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 Gupta Amarnath 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.
Low bargaining power of suppliers
– Suppliers of Gupta Amarnath in the sector have low bargaining power. Amarnath Gupta and Sons: The Family Business has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Gupta Amarnath to manage not only supply disruptions but also source products at highly competitive prices.
Strong track record of project management
– Gupta Amarnath is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses Amarnath Gupta and Sons: The Family Business | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Amarnath Gupta and Sons: The Family Business are -
High operating costs
– Compare to the competitors, firm in the HBR case study Amarnath Gupta and Sons: The Family Business 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 Gupta Amarnath 's lucrative customers.
Skills based hiring
– The stress on hiring functional specialists at Gupta Amarnath 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.
Slow decision making process
– As mentioned earlier in the report, Gupta Amarnath 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. Gupta Amarnath 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.
Increasing silos among functional specialists
– The organizational structure of Gupta Amarnath is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Gupta Amarnath needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Gupta Amarnath to focus more on services rather than just following the product oriented approach.
Lack of clear differentiation of Gupta Amarnath products
– To increase the profitability and margins on the products, Gupta Amarnath needs to provide more differentiated products than what it is currently offering in the marketplace.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Amarnath Gupta and Sons: The Family Business 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 Gupta Amarnath has relatively successful track record of launching new products.
Slow to strategic competitive environment developments
– As Amarnath Gupta and Sons: The Family Business HBR case study mentions - Gupta Amarnath takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
High cash cycle compare to competitors
Gupta Amarnath 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.
Low market penetration in new markets
– Outside its home market of Gupta Amarnath, firm in the HBR case study Amarnath Gupta and Sons: The Family Business needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Products dominated business model
– Even though Gupta Amarnath 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 - Amarnath Gupta and Sons: The Family Business should strive to include more intangible value offerings along with its core products and services.
High bargaining power of channel partners
– Because of the regulatory requirements, Rajesh Panda, Pooja Gupta, Madhvi Sethi suggests that, Gupta Amarnath 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.
Opportunities Amarnath Gupta and Sons: The Family Business | 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 Amarnath Gupta and Sons: The Family Business are -
Building a culture of innovation
– managers at Gupta Amarnath 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.
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. Gupta Amarnath can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Gupta Amarnath can use these opportunities to build new business models that can help the communities that Gupta Amarnath 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 Gupta Amarnath 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.
Buying journey improvements
– Gupta Amarnath can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Amarnath Gupta and Sons: The Family Business 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. Gupta Amarnath 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. Gupta Amarnath 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.
Developing new processes and practices
– Gupta Amarnath 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.
Creating value in data economy
– The success of analytics program of Gupta Amarnath has opened avenues for new revenue streams for the organization in the industry. This can help Gupta Amarnath to build a more holistic ecosystem as suggested in the Amarnath Gupta and Sons: The Family Business case study. Gupta Amarnath can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Low interest rates
– Even though inflation is raising its head in most developed economies, Gupta Amarnath 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.
Leveraging digital technologies
– Gupta Amarnath 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.
Better consumer reach
– The expansion of the 5G network will help Gupta Amarnath to increase its market reach. Gupta Amarnath 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.
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 Gupta Amarnath in the consumer business. Now Gupta Amarnath can target international markets with far fewer capital restrictions requirements than the existing system.
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. Gupta Amarnath can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats Amarnath Gupta and Sons: The Family Business External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Amarnath Gupta and Sons: The Family Business are -
High dependence on third party suppliers
– Gupta Amarnath 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.
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 Gupta Amarnath in the Leadership & Managing People sector and impact the bottomline of the organization.
Consumer confidence and its impact on Gupta Amarnath 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 Gupta Amarnath with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Gupta Amarnath.
Increasing wage structure of Gupta Amarnath
– 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 Gupta Amarnath.
Stagnating economy with rate increase
– Gupta Amarnath 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.
Technology acceleration in Forth Industrial Revolution
– Gupta Amarnath has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Gupta Amarnath 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.
Regulatory challenges
– Gupta Amarnath 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.
Shortening product life cycle
– it is one of the major threat that Gupta Amarnath is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Gupta Amarnath 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 Gupta Amarnath 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.
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.
Weighted SWOT Analysis of Amarnath Gupta and Sons: The Family Business 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 Amarnath Gupta and Sons: The Family Business 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 Amarnath Gupta and Sons: The Family Business 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 Amarnath Gupta and Sons: The Family Business 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 Amarnath Gupta and Sons: The Family Business 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 Gupta Amarnath needs to make to build a sustainable competitive advantage.