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 - – increasing government debt because of Covid-19 spendings, increasing inequality as vast percentage of new income is going to the top 1%, increasing commodity prices, central banks are concerned over increasing inflation, wage bills are increasing, there is backlash against globalization, competitive advantages are harder to sustain because of technology dispersion,
increasing transportation and logistics costs, talent flight as more people leaving formal jobs, 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 -
Training and development
– Boyan Texas has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in H-E-B: Creating a Movement to Reduce Obesity in Texas 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.
Operational resilience
– The operational resilience strategy in the H-E-B: Creating a Movement to Reduce Obesity in Texas Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
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.
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.
Diverse revenue streams
– Boyan Texas is present in almost all the verticals within the industry. This has provided firm in H-E-B: Creating a Movement to Reduce Obesity in Texas 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.
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.
Low bargaining power of suppliers
– Suppliers of Boyan Texas in the sector have low bargaining power. H-E-B: Creating a Movement to Reduce Obesity in Texas has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Boyan Texas to manage not only supply disruptions but also source products at highly competitive prices.
Analytics focus
– Boyan Texas 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 Jose B. Alvarez, Jason Riis, Walter J. Salmon 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.
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.
High switching costs
– The high switching costs that Boyan Texas 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.
Highly skilled collaborators
– Boyan Texas 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 H-E-B: Creating a Movement to Reduce Obesity in Texas HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
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.
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 -
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study H-E-B: Creating a Movement to Reduce Obesity in Texas, it seems that the employees of Boyan Texas 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.
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.
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.
Products dominated business model
– Even though Boyan Texas 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 - H-E-B: Creating a Movement to Reduce Obesity in Texas should strive to include more intangible value offerings along with its core products and services.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Boyan Texas is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study H-E-B: Creating a Movement to Reduce Obesity in Texas can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
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.
Aligning sales with marketing
– It come across in the case study H-E-B: Creating a Movement to Reduce Obesity in Texas 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 H-E-B: Creating a Movement to Reduce Obesity in Texas can leverage the sales team experience to cultivate customer relationships as Boyan Texas is planning to shift buying processes online.
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.
Skills based hiring
– The stress on hiring functional specialists at Boyan Texas has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study 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.
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.
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 -
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.
Developing new processes and practices
– Boyan Texas 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.
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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Boyan Texas 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 Boyan Texas to hire the very best people irrespective of their geographical location.
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.
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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Boyan Texas 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, H-E-B: Creating a Movement to Reduce Obesity in Texas, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Loyalty marketing
– Boyan Texas 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.
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.
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.
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.
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.
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 -
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. Boyan Texas 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.
Technology acceleration in Forth Industrial Revolution
– Boyan Texas has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Boyan Texas 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.
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.
Environmental challenges
– Boyan Texas 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. Boyan Texas can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Boyan Texas 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 H-E-B: Creating a Movement to Reduce Obesity in Texas .
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.
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.
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.
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.
Shortening product life cycle
– it is one of the major threat that Boyan Texas is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 .
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.
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.