Gary Loveman and Harrah's Entertainment SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Organizational Development
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Gary Loveman and Harrah's Entertainment
In 1998, 38-year-old Gary Loveman was perfectly content with his job as an untenured associate professor at the Harvard Business School. He was a popular teacher with standing room only classes in service management. He lived comfortably with his family in Massachusetts and had successful consulting engagements and executive education assignments with companies such as Harrah's Entertainment. His prospects for tenure review, coming up in the next year or two, looked good. Then his life dramatically changed when the then-CEO of Harrah's, Phil Satre, offered him a job as chief operating officer (COO) of the company. Commuting from his home in Massachusetts, Loveman took the job and never turned back. But hiring Loveman caused some internal and external rumblings. Loveman had never before managed anyone apart from his administrative assistant and some research assistants; he was now going to manage 15 casinos with more than 10,000 hotel rooms and over 35,000 employees. The company was also closing one of its largest acquisitions to date, Showboat. Moreover, the gaming industry was not, in 1998, a common destination for MBA graduates, let alone PhDs--it was an industry dominated by insiders who had spent their careers in gaming, working their way up from the bottom. The tasks facing Loveman as he joined Harrah's were daunting. He had somehow to gain credibility and respect inside Harrah's, as well as in the industry. He had to lead Harrah's through a transition to a more marketing-focused company and help the company break out of a financial performance plateau. And he had to build a set of relationships and a power base to potentially attain the CEO position when Satre stepped down in five years. What could he do to accomplish all this?
Swot Analysis of "Gary Loveman and Harrah's Entertainment" written by Victoria Chang, Jeffrey Pfeffer includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Loveman Harrah's facing as an external strategic factors. Some of the topics covered in Gary Loveman and Harrah's Entertainment case study are - Strategic Management Strategies, Collaboration, Influence, Leadership, Organizational culture, Succession planning and Organizational Development.
Some of the macro environment factors that can be used to understand the Gary Loveman and Harrah's Entertainment casestudy better are - – there is backlash against globalization, supply chains are disrupted by pandemic , increasing commodity prices, customer relationship management is fast transforming because of increasing concerns over data privacy, geopolitical disruptions, banking and financial system is disrupted by Bitcoin and other crypto currencies, talent flight as more people leaving formal jobs,
increasing government debt because of Covid-19 spendings, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Gary Loveman and Harrah's Entertainment
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Gary Loveman and Harrah's Entertainment case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Loveman Harrah's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Loveman Harrah'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 Gary Loveman and Harrah's Entertainment can be done for the following purposes –
1. Strategic planning using facts provided in Gary Loveman and Harrah's Entertainment case study
2. Improving business portfolio management of Loveman Harrah'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 Loveman Harrah's
Strengths Gary Loveman and Harrah's Entertainment | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Loveman Harrah's in Gary Loveman and Harrah's Entertainment Harvard Business Review case study are -
Digital Transformation in Organizational Development segment
- digital transformation varies from industry to industry. For Loveman Harrah's digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Loveman Harrah's 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.
Low bargaining power of suppliers
– Suppliers of Loveman Harrah's in the sector have low bargaining power. Gary Loveman and Harrah's Entertainment has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Loveman Harrah's to manage not only supply disruptions but also source products at highly competitive prices.
Learning organization
- Loveman Harrah'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 Loveman Harrah's is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Gary Loveman and Harrah's Entertainment Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Analytics focus
– Loveman Harrah'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 Victoria Chang, Jeffrey Pfeffer 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.
Cross disciplinary teams
– Horizontal connected teams at the Loveman Harrah'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.
High switching costs
– The high switching costs that Loveman Harrah'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.
Diverse revenue streams
– Loveman Harrah's is present in almost all the verticals within the industry. This has provided firm in Gary Loveman and Harrah's Entertainment 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.
Training and development
– Loveman Harrah's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Gary Loveman and Harrah's Entertainment 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 brand equity
– Loveman Harrah's has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Loveman Harrah's to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Highly skilled collaborators
– Loveman Harrah'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 Gary Loveman and Harrah's Entertainment HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of Loveman Harrah's
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Loveman Harrah's does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Loveman Harrah's is one of the leading recruiters in the industry. Managers in the Gary Loveman and Harrah's Entertainment are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Weaknesses Gary Loveman and Harrah's Entertainment | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Gary Loveman and Harrah's Entertainment are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Gary Loveman and Harrah's Entertainment 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 Loveman Harrah's has relatively successful track record of launching new products.
Increasing silos among functional specialists
– The organizational structure of Loveman Harrah's is dominated by functional specialists. It is not different from other players in the Organizational Development segment. Loveman Harrah's needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Loveman Harrah's to focus more on services rather than just following the product oriented approach.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Loveman Harrah's is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Gary Loveman and Harrah's Entertainment can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Interest costs
– Compare to the competition, Loveman Harrah's has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
High operating costs
– Compare to the competitors, firm in the HBR case study Gary Loveman and Harrah's Entertainment 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 Loveman Harrah's 's lucrative customers.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Gary Loveman and Harrah's Entertainment, in the dynamic environment Loveman Harrah's has struggled to respond to the nimble upstart competition. Loveman Harrah's has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Gary Loveman and Harrah's Entertainment, is just above the industry average. Loveman Harrah's 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.
Aligning sales with marketing
– It come across in the case study Gary Loveman and Harrah's Entertainment 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 Gary Loveman and Harrah's Entertainment can leverage the sales team experience to cultivate customer relationships as Loveman Harrah's is planning to shift buying processes online.
Slow decision making process
– As mentioned earlier in the report, Loveman Harrah'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. Loveman Harrah'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.
Workers concerns about automation
– As automation is fast increasing in the segment, Loveman Harrah'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.
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 Loveman Harrah's supply chain. Even after few cautionary changes mentioned in the HBR case study - Gary Loveman and Harrah's Entertainment, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Loveman Harrah's vulnerable to further global disruptions in South East Asia.
Opportunities Gary Loveman and Harrah's Entertainment | 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 Gary Loveman and Harrah's Entertainment are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Loveman Harrah's can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Gary Loveman and Harrah's Entertainment, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Better consumer reach
– The expansion of the 5G network will help Loveman Harrah's to increase its market reach. Loveman Harrah'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.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Loveman Harrah's to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Loveman Harrah's can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Learning at scale
– Online learning technologies has now opened space for Loveman Harrah'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.
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 Loveman Harrah's in the consumer business. Now Loveman Harrah's can target international markets with far fewer capital restrictions requirements than the existing system.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Organizational Development industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Loveman Harrah's 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. Loveman Harrah's 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.
Building a culture of innovation
– managers at Loveman Harrah'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.
Creating value in data economy
– The success of analytics program of Loveman Harrah's has opened avenues for new revenue streams for the organization in the industry. This can help Loveman Harrah's to build a more holistic ecosystem as suggested in the Gary Loveman and Harrah's Entertainment case study. Loveman Harrah's can build new products and services such as - data insight services, data privacy related products, data based consulting services, 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, Loveman Harrah's can use these opportunities to build new business models that can help the communities that Loveman Harrah's operates in. Secondly it can use opportunities from government spending in Organizational Development sector.
Leveraging digital technologies
– Loveman Harrah'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.
Using analytics as competitive advantage
– Loveman Harrah'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 Gary Loveman and Harrah's Entertainment - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Loveman Harrah's to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Manufacturing automation
– Loveman Harrah'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.
Threats Gary Loveman and Harrah's Entertainment External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Gary Loveman and Harrah's Entertainment are -
Increasing wage structure of Loveman Harrah's
– 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 Loveman Harrah's.
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 Loveman Harrah's in the Organizational Development sector and impact the bottomline of the organization.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Loveman Harrah's can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Gary Loveman and Harrah's Entertainment .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Loveman Harrah'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.
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 Loveman Harrah'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. Loveman Harrah's needs to understand the core reasons impacting the Organizational Development industry. This will help it in building a better workplace.
Consumer confidence and its impact on Loveman Harrah'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.
Technology acceleration in Forth Industrial Revolution
– Loveman Harrah's has witnessed rapid integration of technology during Covid-19 in the Organizational Development industry. As one of the leading players in the industry, Loveman Harrah'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.
Regulatory challenges
– Loveman Harrah's 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 Organizational Development industry regulations.
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. Loveman Harrah'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.
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.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Gary Loveman and Harrah's Entertainment, Loveman Harrah's may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Organizational Development .
Weighted SWOT Analysis of Gary Loveman and Harrah's Entertainment 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 Gary Loveman and Harrah's Entertainment 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 Gary Loveman and Harrah's Entertainment 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 Gary Loveman and Harrah's Entertainment 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 Gary Loveman and Harrah's Entertainment 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 Loveman Harrah's needs to make to build a sustainable competitive advantage.