Case Study Description of Shiva Tourist Dhaba: Managing Customer Loyalty
In 2014, the owner of Shiva Tourist Dhaba, a highway restaurant specializing in authentic Indian cuisine, faced a pressing decision. The business had been successful since opening in 1995, but it now faced intense competition. The owner was working with a marketing research team in pursuit of two objectives: to gain insight into customer loyalty and to decide on his restaurant's positioning strategy. After conducting a survey of restaurant customers, the marketing research team needed to determine the tool that would best analyze the data to help resolve the issues facing the restaurant owner. Madhurima Deb is affiliated with Indian Institute of Management Kashipur. Gautam Sinha is affiliated with Indian Institute of Technology Kharagpur.
Swot Analysis of "Shiva Tourist Dhaba: Managing Customer Loyalty" written by Madhurima Deb, Guatam Sinha includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Dhaba Shiva facing as an external strategic factors. Some of the topics covered in Shiva Tourist Dhaba: Managing Customer Loyalty case study are - Strategic Management Strategies, Financial analysis, Marketing and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Shiva Tourist Dhaba: Managing Customer Loyalty casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, supply chains are disrupted by pandemic , increasing commodity prices, increasing inequality as vast percentage of new income is going to the top 1%, talent flight as more people leaving formal jobs, cloud computing is disrupting traditional business models, geopolitical disruptions,
wage bills are increasing, technology disruption, etc
Introduction to SWOT Analysis of Shiva Tourist Dhaba: Managing Customer Loyalty
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Shiva Tourist Dhaba: Managing Customer Loyalty case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Dhaba Shiva, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Dhaba Shiva 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 Shiva Tourist Dhaba: Managing Customer Loyalty can be done for the following purposes –
1. Strategic planning using facts provided in Shiva Tourist Dhaba: Managing Customer Loyalty case study
2. Improving business portfolio management of Dhaba Shiva
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 Dhaba Shiva
Strengths Shiva Tourist Dhaba: Managing Customer Loyalty | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Dhaba Shiva in Shiva Tourist Dhaba: Managing Customer Loyalty Harvard Business Review case study are -
Innovation driven organization
– Dhaba Shiva is one of the most innovative firm in sector. Manager in Shiva Tourist Dhaba: Managing Customer Loyalty Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Dhaba Shiva digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Dhaba Shiva 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.
Effective Research and Development (R&D)
– Dhaba Shiva 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 Shiva Tourist Dhaba: Managing Customer Loyalty - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Low bargaining power of suppliers
– Suppliers of Dhaba Shiva in the sector have low bargaining power. Shiva Tourist Dhaba: Managing Customer Loyalty has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Dhaba Shiva to manage not only supply disruptions but also source products at highly competitive prices.
Successful track record of launching new products
– Dhaba Shiva has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Dhaba Shiva 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 Dhaba Shiva 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 brand equity
– Dhaba Shiva has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Dhaba Shiva to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to recruit top talent
– Dhaba Shiva is one of the leading recruiters in the industry. Managers in the Shiva Tourist Dhaba: Managing Customer Loyalty are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Superior customer experience
– The customer experience strategy of Dhaba Shiva in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Sustainable margins compare to other players in Sales & Marketing industry
– Shiva Tourist Dhaba: Managing Customer Loyalty firm has clearly differentiated products in the market place. This has enabled Dhaba Shiva to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Dhaba Shiva to invest into research and development (R&D) and innovation.
Learning organization
- Dhaba Shiva 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 Dhaba Shiva is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Shiva Tourist Dhaba: Managing Customer Loyalty Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Dhaba Shiva is present in almost all the verticals within the industry. This has provided firm in Shiva Tourist Dhaba: Managing Customer Loyalty 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.
Weaknesses Shiva Tourist Dhaba: Managing Customer Loyalty | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Shiva Tourist Dhaba: Managing Customer Loyalty are -
High cash cycle compare to competitors
Dhaba Shiva 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Shiva Tourist Dhaba: Managing Customer Loyalty 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 Dhaba Shiva has relatively successful track record of launching new products.
Products dominated business model
– Even though Dhaba Shiva has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Shiva Tourist Dhaba: Managing Customer Loyalty should strive to include more intangible value offerings along with its core products and services.
Slow decision making process
– As mentioned earlier in the report, Dhaba Shiva 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. Dhaba Shiva 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.
Lack of clear differentiation of Dhaba Shiva products
– To increase the profitability and margins on the products, Dhaba Shiva needs to provide more differentiated products than what it is currently offering in the marketplace.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Shiva Tourist Dhaba: Managing Customer Loyalty, it seems that the employees of Dhaba Shiva don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Skills based hiring
– The stress on hiring functional specialists at Dhaba Shiva 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.
No frontier risks strategy
– After analyzing the HBR case study Shiva Tourist Dhaba: Managing Customer Loyalty, it seems that company is thinking about the frontier risks that can impact Sales & Marketing 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.
Aligning sales with marketing
– It come across in the case study Shiva Tourist Dhaba: Managing Customer Loyalty 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 Shiva Tourist Dhaba: Managing Customer Loyalty can leverage the sales team experience to cultivate customer relationships as Dhaba Shiva is planning to shift buying processes online.
Need for greater diversity
– Dhaba Shiva 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Madhurima Deb, Guatam Sinha suggests that, Dhaba Shiva is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Opportunities Shiva Tourist Dhaba: Managing Customer Loyalty | 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 Shiva Tourist Dhaba: Managing Customer Loyalty are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Dhaba Shiva 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 Dhaba Shiva to hire the very best people irrespective of their geographical location.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Dhaba Shiva can use these opportunities to build new business models that can help the communities that Dhaba Shiva operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
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 Dhaba Shiva in the consumer business. Now Dhaba Shiva can target international markets with far fewer capital restrictions requirements than the existing system.
Creating value in data economy
– The success of analytics program of Dhaba Shiva has opened avenues for new revenue streams for the organization in the industry. This can help Dhaba Shiva to build a more holistic ecosystem as suggested in the Shiva Tourist Dhaba: Managing Customer Loyalty case study. Dhaba Shiva can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Sales & Marketing industry, but it has also influenced the consumer preferences. Dhaba Shiva can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Building a culture of innovation
– managers at Dhaba Shiva 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 Sales & Marketing segment.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Dhaba Shiva is facing challenges because of the dominance of functional experts in the organization. Shiva Tourist Dhaba: Managing Customer Loyalty 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.
Using analytics as competitive advantage
– Dhaba Shiva 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 Shiva Tourist Dhaba: Managing Customer Loyalty - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Dhaba Shiva to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Better consumer reach
– The expansion of the 5G network will help Dhaba Shiva to increase its market reach. Dhaba Shiva 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
– Dhaba Shiva can develop new processes and procedures in Sales & Marketing 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
– Dhaba Shiva 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.
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. Dhaba Shiva can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Learning at scale
– Online learning technologies has now opened space for Dhaba Shiva 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.
Threats Shiva Tourist Dhaba: Managing Customer Loyalty External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Shiva Tourist Dhaba: Managing Customer Loyalty are -
Regulatory challenges
– Dhaba Shiva 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.
Shortening product life cycle
– it is one of the major threat that Dhaba Shiva is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Easy access to finance
– Easy access to finance in Sales & Marketing field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Dhaba Shiva can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Environmental challenges
– Dhaba Shiva 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. Dhaba Shiva can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Dhaba Shiva with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Stagnating economy with rate increase
– Dhaba Shiva 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Shiva Tourist Dhaba: Managing Customer Loyalty, Dhaba Shiva 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 .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Dhaba Shiva 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.
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. Dhaba Shiva 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 Dhaba Shiva in the Sales & Marketing sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– Dhaba Shiva has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Dhaba Shiva needs to keep up with the evolution of technology in the Sales & Marketing 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 Dhaba Shiva 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.
Weighted SWOT Analysis of Shiva Tourist Dhaba: Managing Customer Loyalty 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 Shiva Tourist Dhaba: Managing Customer Loyalty 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 Shiva Tourist Dhaba: Managing Customer Loyalty 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 Shiva Tourist Dhaba: Managing Customer Loyalty 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 Shiva Tourist Dhaba: Managing Customer Loyalty 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 Dhaba Shiva needs to make to build a sustainable competitive advantage.