Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base
This case describes Banyan Tree Resorts & Hotel's rapid growth starting from a single resort converted from a disused tin mine in Phuket, Thailand, to become an international resort operator and one of Asia's top 20 brands. It explores the realisation of an innovative lifestyle concept, the subsequent challenges involved in replicating its original success in different parts of the world, the company's marketing strategy, and the development of service operations capabilities to back the brand, as well as the challenges faced in extending the brand into new businesses including branded goods and a travel portal.
Authors :: Peter J. Williamson, Arnoud De Meyer, Hwee Chua Chei
Swot Analysis of "Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base" written by Peter J. Williamson, Arnoud De Meyer, Hwee Chua Chei includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Banyan Tree facing as an external strategic factors. Some of the topics covered in Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base case study are - Strategic Management Strategies, Project management and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base casestudy better are - – increasing transportation and logistics costs, wage bills are increasing, central banks are concerned over increasing inflation, increasing inequality as vast percentage of new income is going to the top 1%, challanges to central banks by blockchain based private currencies, talent flight as more people leaving formal jobs, cloud computing is disrupting traditional business models,
increasing household debt because of falling income levels, increasing energy prices, etc
Introduction to SWOT Analysis of Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Banyan Tree, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Banyan Tree 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 Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base can be done for the following purposes –
1. Strategic planning using facts provided in Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base case study
2. Improving business portfolio management of Banyan Tree
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Banyan Tree
Strengths Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Banyan Tree in Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base Harvard Business Review case study are -
Superior customer experience
– The customer experience strategy of Banyan Tree in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to lead change in Strategy & Execution field
– Banyan Tree 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 Banyan Tree in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High brand equity
– Banyan Tree has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Banyan Tree to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Successful track record of launching new products
– Banyan Tree has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Banyan Tree 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.
Learning organization
- Banyan Tree 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 Banyan Tree is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Banyan Tree is present in almost all the verticals within the industry. This has provided firm in Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Training and development
– Banyan Tree has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base 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.
Cross disciplinary teams
– Horizontal connected teams at the Banyan Tree 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)
– Banyan Tree 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 Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base - 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 Banyan Tree in the sector have low bargaining power. Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Banyan Tree to manage not only supply disruptions but also source products at highly competitive prices.
Innovation driven organization
– Banyan Tree is one of the most innovative firm in sector. Manager in Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Operational resilience
– The operational resilience strategy in the Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base 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.
Weaknesses Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base are -
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 Banyan Tree supply chain. Even after few cautionary changes mentioned in the HBR case study - Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Banyan Tree vulnerable to further global disruptions in South East Asia.
Interest costs
– Compare to the competition, Banyan Tree 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.
Capital Spending Reduction
– Even during the low interest decade, Banyan Tree has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
High bargaining power of channel partners
– Because of the regulatory requirements, Peter J. Williamson, Arnoud De Meyer, Hwee Chua Chei suggests that, Banyan Tree 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 dependence on star products
– The top 2 products and services of the firm as mentioned in the Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base 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 Banyan Tree has relatively successful track record of launching new products.
Slow decision making process
– As mentioned earlier in the report, Banyan Tree 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. Banyan Tree 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 Banyan Tree products
– To increase the profitability and margins on the products, Banyan Tree needs to provide more differentiated products than what it is currently offering in the marketplace.
Low market penetration in new markets
– Outside its home market of Banyan Tree, firm in the HBR case study Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High operating costs
– Compare to the competitors, firm in the HBR case study Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base 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 Banyan Tree 's lucrative customers.
No frontier risks strategy
– After analyzing the HBR case study Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base, it seems that company is thinking about the frontier risks that can impact Strategy & Execution 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.
Increasing silos among functional specialists
– The organizational structure of Banyan Tree is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Banyan Tree needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Banyan Tree to focus more on services rather than just following the product oriented approach.
Opportunities Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base | 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 Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base are -
Loyalty marketing
– Banyan Tree 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. Banyan Tree can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Manufacturing automation
– Banyan Tree can use the latest technology developments to improve its manufacturing and designing process in Strategy & Execution 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.
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 Banyan Tree 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.
Learning at scale
– Online learning technologies has now opened space for Banyan Tree 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, Banyan Tree is facing challenges because of the dominance of functional experts in the organization. Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Banyan Tree 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Banyan Tree 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, Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Buying journey improvements
– Banyan Tree can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base 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.
Using analytics as competitive advantage
– Banyan Tree 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 Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Banyan Tree to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Developing new processes and practices
– Banyan Tree can develop new processes and procedures in Strategy & Execution 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Banyan Tree 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 Banyan Tree to hire the very best people irrespective of their geographical location.
Creating value in data economy
– The success of analytics program of Banyan Tree has opened avenues for new revenue streams for the organization in the industry. This can help Banyan Tree to build a more holistic ecosystem as suggested in the Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base case study. Banyan Tree can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base 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 Banyan Tree in the Strategy & Execution sector and impact the bottomline of the organization.
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 Banyan Tree 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. Banyan Tree needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Technology acceleration in Forth Industrial Revolution
– Banyan Tree has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Banyan Tree needs to keep up with the evolution of technology in the Strategy & Execution 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.
Environmental challenges
– Banyan Tree 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. Banyan Tree can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
High dependence on third party suppliers
– Banyan Tree 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.
Easy access to finance
– Easy access to finance in Strategy & Execution field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Banyan Tree can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
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 Banyan Tree.
Increasing wage structure of Banyan Tree
– 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 Banyan Tree.
Regulatory challenges
– Banyan Tree 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 Strategy & Execution industry regulations.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base, Banyan Tree may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Strategy & Execution .
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.
Weighted SWOT Analysis of Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base 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 Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base 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 Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base 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 Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base 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 Banyan Tree Resorts & Hotels: Building an International Brand From an Asian Base 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 Banyan Tree needs to make to build a sustainable competitive advantage.