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 - – challanges to central banks by blockchain based private currencies, wage bills are increasing, cloud computing is disrupting traditional business models, increasing government debt because of Covid-19 spendings, increasing inequality as vast percentage of new income is going to the top 1%, talent flight as more people leaving formal jobs, technology disruption,
increasing household debt because of falling income levels, there is backlash against globalization, 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 -
Strong track record of project management
– Dhaba Shiva is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
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.
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.
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.
Analytics focus
– Dhaba Shiva 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 Madhurima Deb, Guatam Sinha 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.
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.
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.
Highly skilled collaborators
– Dhaba Shiva 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 Shiva Tourist Dhaba: Managing Customer Loyalty HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
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.
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.
Organizational Resilience of Dhaba Shiva
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Dhaba Shiva does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
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 -
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.
Workers concerns about automation
– As automation is fast increasing in the segment, Dhaba Shiva 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 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Shiva Tourist Dhaba: Managing Customer Loyalty, in the dynamic environment Dhaba Shiva has struggled to respond to the nimble upstart competition. Dhaba Shiva has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Dhaba Shiva supply chain. Even after few cautionary changes mentioned in the HBR case study - Shiva Tourist Dhaba: Managing Customer Loyalty, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Dhaba Shiva vulnerable to further global disruptions in South East Asia.
Low market penetration in new markets
– Outside its home market of Dhaba Shiva, firm in the HBR case study Shiva Tourist Dhaba: Managing Customer Loyalty needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
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.
High operating costs
– Compare to the competitors, firm in the HBR case study Shiva Tourist Dhaba: Managing Customer Loyalty 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 Dhaba Shiva 's lucrative customers.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Shiva Tourist Dhaba: Managing Customer Loyalty, is just above the industry average. Dhaba Shiva 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.
Interest costs
– Compare to the competition, Dhaba Shiva 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.
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.
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 -
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 Dhaba Shiva 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.
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.
Manufacturing automation
– Dhaba Shiva 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.
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. Dhaba Shiva 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. Dhaba Shiva 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.
Buying journey improvements
– Dhaba Shiva can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Shiva Tourist Dhaba: Managing Customer Loyalty suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Low interest rates
– Even though inflation is raising its head in most developed economies, Dhaba Shiva 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.
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.
Leveraging digital technologies
– Dhaba Shiva 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.
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.
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.
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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Dhaba Shiva 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, Shiva Tourist Dhaba: Managing Customer Loyalty, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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.
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 -
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.
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.
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.
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.
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.
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.
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 Dhaba Shiva business can come under increasing regulations regarding data privacy, data security, etc.
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. Dhaba Shiva needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Dhaba Shiva 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 Shiva Tourist Dhaba: Managing Customer Loyalty .
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.
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.
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 .
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.