Cann Group (CAN) SWOT Analysis / TOWS Matrix / MBA Resources
Crops
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Cann Group (Australia)
Based on various researches at Oak Spring University , Cann Group is operating in a macro-environment that has been destablized by – increasing commodity prices, cloud computing is disrupting traditional business models, competitive advantages are harder to sustain because of technology dispersion, there is increasing trade war between United States & China, supply chains are disrupted by pandemic , banking and financial system is disrupted by Bitcoin and other crypto currencies, central banks are concerned over increasing inflation,
increasing transportation and logistics costs, there is backlash against globalization, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Cann Group can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Cann Group, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Cann Group 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 Cann Group can be done for the following purposes –
1. Strategic planning of Cann Group
2. Improving business portfolio management of Cann Group
3. Assessing feasibility of the new initiative in Australia
4. Making a Crops sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Cann Group
Strengths of Cann Group | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Cann Group are -
Training and development
– Cann Group has one of the best training and development program in Consumer/Non-Cyclical industry. The effectiveness of the training programs can be measured in – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
High switching costs
– The high switching costs that Cann Group 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.
Sustainable margins compare to other players in Crops industry
– Cann Group has clearly differentiated products in the market place. This has enabled Cann Group to fetch slight price premium compare to the competitors in the Crops industry. The sustainable margins have also helped Cann Group to invest into research and development (R&D) and innovation.
Strong track record of project management in the Crops industry
– Cann Group is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Highly skilled collaborators
– Cann Group has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Crops industry. Secondly the value chain collaborators of Cann Group have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Cann Group is one of the most innovative firm in Crops sector.
Organizational Resilience of Cann Group
– The covid-19 pandemic has put organizational resilience at the centre of everthing Cann Group does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Successful track record of launching new products
– Cann Group has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Cann Group has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
High brand equity
– Cann Group has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Cann Group to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Superior customer experience
– The customer experience strategy of Cann Group in Crops industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Effective Research and Development (R&D)
– Cann Group has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Cann Group staying ahead in the Crops industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Digital Transformation in Crops industry
- digital transformation varies from industry to industry. For Cann Group digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Cann Group 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.
Weaknesses of Cann Group | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Cann Group are -
Capital Spending Reduction
– Even during the low interest decade, Cann Group 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 Crops 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, Cann Group is slow explore the new channels of communication. These new channels of communication can help Cann Group to provide better information regarding Crops products and services. It can also build an online community to further reach out to potential customers.
Lack of clear differentiation of Cann Group products
– To increase the profitability and margins on the products, Cann Group needs to provide more differentiated products than what it is currently offering in the marketplace.
Ability to respond to the competition
– As the decision making is very deliberative at Cann Group, in the dynamic environment of Crops industry it has struggled to respond to the nimble upstart competition. Cann Group has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
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 Cann Group supply chain. Even after few cautionary changes, Cann Group is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Cann Group vulnerable to further global disruptions in South East Asia.
Compensation and incentives
– The revenue per employee of Cann Group is just above the Crops industry average. It needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
High operating costs
– Compare to the competitors, Cann Group has high operating costs in the Crops industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Cann Group lucrative customers.
Slow to strategic competitive environment developments
– As Cann Group is one of the leading players in the Crops industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Crops industry in last five years.
Increasing silos among functional specialists
– The organizational structure of Cann Group is dominated by functional specialists. It is not different from other players in the Crops industry, but Cann Group needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Cann Group to focus more on services in the Crops industry rather than just following the product oriented approach.
High dependence on Cann Group ‘s star products
– The top 2 products and services of Cann Group still accounts for major business revenue. This dependence on star products in Crops industry has resulted into insufficient focus on developing new products, even though Cann Group has relatively successful track record of launching new products.
Low market penetration in new markets
– Outside its home market of Australia, Cann Group needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Cann Group Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Cann Group are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Cann Group 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 Cann Group to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Use of Bitcoin and other crypto currencies for transactions in Crops industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Cann Group in the Crops industry. Now Cann Group can target international markets with far fewer capital restrictions requirements than the existing system.
Using analytics as competitive advantage
– Cann Group has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Crops sector. This continuous investment in analytics has enabled Cann Group to build a competitive advantage using analytics. The analytics driven competitive advantage can help Cann Group to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Building a culture of innovation
– managers at Cann Group 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 Crops industry.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Cann Group can use these opportunities to build new business models that can help the communities that Cann Group operates in. Secondly it can use opportunities from government spending in Crops sector.
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. Cann Group can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Cann Group is facing challenges because of the dominance of functional experts in the organization. Cann Group can utilize new technology in the field of Crops industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Cann Group can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Cann Group 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 Cann Group to hire the very best people irrespective of their geographical location.
Developing new processes and practices
– Cann Group can develop new processes and procedures in Crops 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Cann Group 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 Cann Group has opened avenues for new revenue streams for the organization in Crops industry. This can help Cann Group to build a more holistic ecosystem for Cann Group products in the Crops industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Cann Group can improve the customer journey of consumers in the Crops industry by using analytics and artificial intelligence. It 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.
Threats Cann Group External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Cann Group are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Crops industry are lowering. It can presents Cann Group with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Crops sector.
Increasing wage structure of Cann Group
– 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 Cann Group.
High dependence on third party suppliers
– Cann Group 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Cann Group may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Crops sector.
Technology acceleration in Forth Industrial Revolution
– Cann Group has witnessed rapid integration of technology during Covid-19 in the Crops industry. As one of the leading players in the industry, Cann Group needs to keep up with the evolution of technology in the Crops 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.
Easy access to finance
– Easy access to finance in Crops industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Cann Group can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Cann Group in Crops industry. The Crops 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.
Environmental challenges
– Cann Group 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. Cann Group can take advantage of this fund but it will also bring new competitors in the Crops industry.
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 Cann Group.
Shortening product life cycle
– it is one of the major threat that Cann Group is facing in Crops sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Stagnating economy with rate increase
– Cann Group 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 Crops industry.
Regulatory challenges
– Cann Group 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 Crops industry regulations.
Weighted SWOT Analysis of Cann Group Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Cann Group 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 Cann Group 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 Cann Group 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 Cann Group 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 Cann Group needs to make to build a sustainable competitive advantage.