H-E-B: Creating a Movement to Reduce Obesity in Texas SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of H-E-B: Creating a Movement to Reduce Obesity in Texas
To maximize their effectiveness, color cases should be printed in color.In January 2012, H-E-B Grocery Co., a private retail chain with stores located in Texas and Mexico, was introducing its Healthy at H-E-B program to its customers. The program, which started with the company's employees a few years earlier, was an effort to educate and inform customers on how to lead a healthier lifestyle. What CEO Craig Boyan had in mind was creating a state-wide healthy living movement in Texas, where obesity was high relative to other states in the U.S. But how far to go with its employees and customers was a question that President and COO Craig Boyan and his team struggled with. On one hand Boyan believed that H-E-B, long recognized for its community involvement, had a role to play in Texans' health and well-being. On the other hand, he recognized that H-E-B was first and foremost a retailer that had to compete against the likes of Walmart. He needed to make sure that H-E-B was serving its customers what they wanted while also trying to influence their buying behavior toward healthier foods. Some would say that H-E-B had no role in changing the lifestyle and food choices of its employees or customers. But Boyan and his team thought differently.
Authors :: Jose B. Alvarez, Jason Riis, Walter J. Salmon
Swot Analysis of "H-E-B: Creating a Movement to Reduce Obesity in Texas" written by Jose B. Alvarez, Jason Riis, Walter J. Salmon includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Boyan Texas facing as an external strategic factors. Some of the topics covered in H-E-B: Creating a Movement to Reduce Obesity in Texas case study are - Strategic Management Strategies, Labor and Sales & Marketing.
Some of the macro environment factors that can be used to understand the H-E-B: Creating a Movement to Reduce Obesity in Texas casestudy better are - – supply chains are disrupted by pandemic , digital marketing is dominated by two big players Facebook and Google, banking and financial system is disrupted by Bitcoin and other crypto currencies, talent flight as more people leaving formal jobs, central banks are concerned over increasing inflation, increasing household debt because of falling income levels, competitive advantages are harder to sustain because of technology dispersion,
increasing commodity prices, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of H-E-B: Creating a Movement to Reduce Obesity in Texas
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in H-E-B: Creating a Movement to Reduce Obesity in Texas case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Boyan Texas, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Boyan Texas 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 H-E-B: Creating a Movement to Reduce Obesity in Texas can be done for the following purposes –
1. Strategic planning using facts provided in H-E-B: Creating a Movement to Reduce Obesity in Texas case study
2. Improving business portfolio management of Boyan Texas
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Boyan Texas
Strengths H-E-B: Creating a Movement to Reduce Obesity in Texas | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Boyan Texas in H-E-B: Creating a Movement to Reduce Obesity in Texas Harvard Business Review case study are -
Superior customer experience
– The customer experience strategy of Boyan Texas in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Effective Research and Development (R&D)
– Boyan Texas has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study H-E-B: Creating a Movement to Reduce Obesity in Texas - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Cross disciplinary teams
– Horizontal connected teams at the Boyan Texas 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.
Learning organization
- Boyan Texas 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 Boyan Texas is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in H-E-B: Creating a Movement to Reduce Obesity in Texas Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in Sales & Marketing industry
– H-E-B: Creating a Movement to Reduce Obesity in Texas firm has clearly differentiated products in the market place. This has enabled Boyan Texas to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Boyan Texas to invest into research and development (R&D) and innovation.
Organizational Resilience of Boyan Texas
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Boyan Texas does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Innovation driven organization
– Boyan Texas is one of the most innovative firm in sector. Manager in H-E-B: Creating a Movement to Reduce Obesity in Texas 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
– Boyan Texas has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Boyan Texas 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.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Boyan Texas digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Boyan Texas 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 brand equity
– Boyan Texas has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Boyan Texas to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Strong track record of project management
– Boyan Texas is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to lead change in Sales & Marketing field
– Boyan Texas 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 Boyan Texas in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Weaknesses H-E-B: Creating a Movement to Reduce Obesity in Texas | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of H-E-B: Creating a Movement to Reduce Obesity in Texas are -
Interest costs
– Compare to the competition, Boyan Texas 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study H-E-B: Creating a Movement to Reduce Obesity in Texas, in the dynamic environment Boyan Texas has struggled to respond to the nimble upstart competition. Boyan Texas 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 H-E-B: Creating a Movement to Reduce Obesity in Texas, is just above the industry average. Boyan Texas needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Lack of clear differentiation of Boyan Texas products
– To increase the profitability and margins on the products, Boyan Texas needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow decision making process
– As mentioned earlier in the report, Boyan Texas 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. Boyan Texas 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Jose B. Alvarez, Jason Riis, Walter J. Salmon suggests that, Boyan Texas 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.
Need for greater diversity
– Boyan Texas 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.
Slow to strategic competitive environment developments
– As H-E-B: Creating a Movement to Reduce Obesity in Texas HBR case study mentions - Boyan Texas 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 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 Boyan Texas supply chain. Even after few cautionary changes mentioned in the HBR case study - H-E-B: Creating a Movement to Reduce Obesity in Texas, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Boyan Texas vulnerable to further global disruptions in South East Asia.
Low market penetration in new markets
– Outside its home market of Boyan Texas, firm in the HBR case study H-E-B: Creating a Movement to Reduce Obesity in Texas needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High cash cycle compare to competitors
Boyan Texas 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.
Opportunities H-E-B: Creating a Movement to Reduce Obesity in Texas | 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 H-E-B: Creating a Movement to Reduce Obesity in Texas are -
Better consumer reach
– The expansion of the 5G network will help Boyan Texas to increase its market reach. Boyan Texas 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.
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. Boyan Texas can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Sales & Marketing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Boyan Texas 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. Boyan Texas 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Boyan Texas can use these opportunities to build new business models that can help the communities that Boyan Texas operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Low interest rates
– Even though inflation is raising its head in most developed economies, Boyan Texas 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.
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 Boyan Texas 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.
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 Boyan Texas in the consumer business. Now Boyan Texas can target international markets with far fewer capital restrictions requirements than the existing system.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Boyan Texas in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Sales & Marketing segment, and it will provide faster access to the consumers.
Manufacturing automation
– Boyan Texas can use the latest technology developments to improve its manufacturing and designing process in Sales & Marketing 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Boyan Texas 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 Boyan Texas 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Boyan Texas is facing challenges because of the dominance of functional experts in the organization. H-E-B: Creating a Movement to Reduce Obesity in Texas case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Creating value in data economy
– The success of analytics program of Boyan Texas has opened avenues for new revenue streams for the organization in the industry. This can help Boyan Texas to build a more holistic ecosystem as suggested in the H-E-B: Creating a Movement to Reduce Obesity in Texas case study. Boyan Texas can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats H-E-B: Creating a Movement to Reduce Obesity in Texas External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study H-E-B: Creating a Movement to Reduce Obesity in Texas are -
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 Boyan Texas in the Sales & Marketing sector and impact the bottomline of the organization.
Regulatory challenges
– Boyan Texas 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 Sales & Marketing industry regulations.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Boyan Texas in the Sales & Marketing industry. The Sales & Marketing 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.
Increasing wage structure of Boyan Texas
– 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 Boyan Texas.
High dependence on third party suppliers
– Boyan Texas 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.
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 Boyan Texas business can come under increasing regulations regarding data privacy, data security, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Boyan Texas with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
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. Boyan Texas needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Consumer confidence and its impact on Boyan Texas 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.
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 Boyan Texas.
Easy access to finance
– Easy access to finance in Sales & Marketing field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Boyan Texas can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study H-E-B: Creating a Movement to Reduce Obesity in Texas, Boyan Texas may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Sales & Marketing .
Weighted SWOT Analysis of H-E-B: Creating a Movement to Reduce Obesity in Texas 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 H-E-B: Creating a Movement to Reduce Obesity in Texas 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 H-E-B: Creating a Movement to Reduce Obesity in Texas 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 H-E-B: Creating a Movement to Reduce Obesity in Texas 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 H-E-B: Creating a Movement to Reduce Obesity in Texas 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 Boyan Texas needs to make to build a sustainable competitive advantage.