Whole Foods: Balancing Social Mission and Growth SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Organizational Development
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Whole Foods: Balancing Social Mission and Growth
In 2009, Whole Foods stands at a crossroads. Their incredible growth over the past 25 years has vaulted them into the ranks of the largest US supermarkets and they have arguably led to the widespread acceptance of natural and organic foods in the United States. Yet more recently, Whole Foods has come under attack as having abandoned their prior social mission as they have increasingly sought to deliver economic growth. The case begins with their acquisition of Wild Oats, at that time their largest competitor and describes many of the mechanisms they have used to successfully integrate prior acquisitions. Furthermore, the case shows the significant tension between their social mission and their far-flung supply chain, while discussing some of the tradeoffs that exist in the development of the "industrial organic" model. Finally, the case 'Whole Foods: Balancing Social Mission and Growth' also allows for students to assess CEO John Mackey's new model of "conscious capitalism." Is Mackey's idea a workable model, or just an excuse for Whole Foods extensive growth while avoiding progressive practices such as a unionized workforce?
Authors :: Christopher Marquis, Marya Besharov, Bobbi Thomason
Swot Analysis of "Whole Foods: Balancing Social Mission and Growth" written by Christopher Marquis, Marya Besharov, Bobbi Thomason includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Foods Mackey's facing as an external strategic factors. Some of the topics covered in Whole Foods: Balancing Social Mission and Growth case study are - Strategic Management Strategies, Leadership, Social responsibility and Organizational Development.
Some of the macro environment factors that can be used to understand the Whole Foods: Balancing Social Mission and Growth casestudy better are - – there is backlash against globalization, increasing inequality as vast percentage of new income is going to the top 1%, digital marketing is dominated by two big players Facebook and Google, technology disruption, supply chains are disrupted by pandemic , geopolitical disruptions, increasing household debt because of falling income levels,
banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of Whole Foods: Balancing Social Mission and Growth
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Whole Foods: Balancing Social Mission and Growth case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Foods Mackey's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Foods Mackey's 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 Whole Foods: Balancing Social Mission and Growth can be done for the following purposes –
1. Strategic planning using facts provided in Whole Foods: Balancing Social Mission and Growth case study
2. Improving business portfolio management of Foods Mackey's
3. Assessing feasibility of the new initiative in Organizational Development field.
4. Making a Organizational Development topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Foods Mackey's
Strengths Whole Foods: Balancing Social Mission and Growth | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Foods Mackey's in Whole Foods: Balancing Social Mission and Growth Harvard Business Review case study are -
Successful track record of launching new products
– Foods Mackey's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Foods Mackey's 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.
Cross disciplinary teams
– Horizontal connected teams at the Foods Mackey's 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.
Highly skilled collaborators
– Foods Mackey's 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 Whole Foods: Balancing Social Mission and Growth HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Strong track record of project management
– Foods Mackey's is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Learning organization
- Foods Mackey's 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 Foods Mackey's is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Whole Foods: Balancing Social Mission and Growth Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Analytics focus
– Foods Mackey's 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 Christopher Marquis, Marya Besharov, Bobbi Thomason 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.
Ability to lead change in Organizational Development field
– Foods Mackey's is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Foods Mackey's in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Organizational Resilience of Foods Mackey's
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Foods Mackey's does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Low bargaining power of suppliers
– Suppliers of Foods Mackey's in the sector have low bargaining power. Whole Foods: Balancing Social Mission and Growth has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Foods Mackey's to manage not only supply disruptions but also source products at highly competitive prices.
Ability to recruit top talent
– Foods Mackey's is one of the leading recruiters in the industry. Managers in the Whole Foods: Balancing Social Mission and Growth are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Training and development
– Foods Mackey's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Whole Foods: Balancing Social Mission and Growth 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.
High switching costs
– The high switching costs that Foods Mackey's 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.
Weaknesses Whole Foods: Balancing Social Mission and Growth | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Whole Foods: Balancing Social Mission and Growth are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Whole Foods: Balancing Social Mission and Growth 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 Foods Mackey's has relatively successful track record of launching new products.
High bargaining power of channel partners
– Because of the regulatory requirements, Christopher Marquis, Marya Besharov, Bobbi Thomason suggests that, Foods Mackey's 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.
Slow decision making process
– As mentioned earlier in the report, Foods Mackey's 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. Foods Mackey's 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.
Low market penetration in new markets
– Outside its home market of Foods Mackey's, firm in the HBR case study Whole Foods: Balancing Social Mission and Growth needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Need for greater diversity
– Foods Mackey's 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.
No frontier risks strategy
– After analyzing the HBR case study Whole Foods: Balancing Social Mission and Growth, it seems that company is thinking about the frontier risks that can impact Organizational Development 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Foods Mackey's needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Increasing silos among functional specialists
– The organizational structure of Foods Mackey's is dominated by functional specialists. It is not different from other players in the Organizational Development segment. Foods Mackey's needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Foods Mackey's to focus more on services rather than just following the product oriented approach.
Skills based hiring
– The stress on hiring functional specialists at Foods Mackey's 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Whole Foods: Balancing Social Mission and Growth, in the dynamic environment Foods Mackey's has struggled to respond to the nimble upstart competition. Foods Mackey's has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High operating costs
– Compare to the competitors, firm in the HBR case study Whole Foods: Balancing Social Mission and Growth 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 Foods Mackey's 's lucrative customers.
Opportunities Whole Foods: Balancing Social Mission and Growth | 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 Whole Foods: Balancing Social Mission and Growth are -
Learning at scale
– Online learning technologies has now opened space for Foods Mackey's 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.
Better consumer reach
– The expansion of the 5G network will help Foods Mackey's to increase its market reach. Foods Mackey's 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.
Developing new processes and practices
– Foods Mackey's can develop new processes and procedures in Organizational Development 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.
Loyalty marketing
– Foods Mackey's 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Foods Mackey's can use these opportunities to build new business models that can help the communities that Foods Mackey's operates in. Secondly it can use opportunities from government spending in Organizational Development sector.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Foods Mackey's can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Foods Mackey's can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Organizational Development industry, but it has also influenced the consumer preferences. Foods Mackey's can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Using analytics as competitive advantage
– Foods Mackey's 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 Whole Foods: Balancing Social Mission and Growth - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Foods Mackey's to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Foods Mackey's in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Organizational Development segment, and it will provide faster access to the consumers.
Building a culture of innovation
– managers at Foods Mackey's 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 Organizational Development segment.
Manufacturing automation
– Foods Mackey's can use the latest technology developments to improve its manufacturing and designing process in Organizational Development 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.
Leveraging digital technologies
– Foods Mackey's 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.
Threats Whole Foods: Balancing Social Mission and Growth External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Whole Foods: Balancing Social Mission and Growth are -
Shortening product life cycle
– it is one of the major threat that Foods Mackey's is facing in Organizational Development sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Foods Mackey's in the Organizational Development industry. The Organizational Development 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.
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. Foods Mackey's 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.
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 Foods Mackey's in the Organizational Development sector and impact the bottomline of the organization.
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 Foods Mackey's.
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. Foods Mackey's needs to understand the core reasons impacting the Organizational Development industry. This will help it in building a better workplace.
Technology acceleration in Forth Industrial Revolution
– Foods Mackey's has witnessed rapid integration of technology during Covid-19 in the Organizational Development industry. As one of the leading players in the industry, Foods Mackey's needs to keep up with the evolution of technology in the Organizational Development 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.
Consumer confidence and its impact on Foods Mackey's 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.
Easy access to finance
– Easy access to finance in Organizational Development field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Foods Mackey's can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Foods Mackey's business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Foods Mackey's 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.
High dependence on third party suppliers
– Foods Mackey's 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.
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 Whole Foods: Balancing Social Mission and Growth 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 Whole Foods: Balancing Social Mission and Growth 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 Whole Foods: Balancing Social Mission and Growth 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 Whole Foods: Balancing Social Mission and Growth 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 Whole Foods: Balancing Social Mission and Growth 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 Foods Mackey's needs to make to build a sustainable competitive advantage.