Ready-to-Eat Breakfast Cereal Industry in 1994 (A) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Ready-to-Eat Breakfast Cereal Industry in 1994 (A)
Ready-to-eat breakfast cereal has historically been a stable and highly profitable industry, dominated by the Big Three of Kellogg, General Mills, and Kraft General Foods (Post). In 1994, private label cereals are making significant market share gains, and promotional competition among the manufacturers of branded cereals is heating up. What steps should one of the Big Three take to prevent these trends from undermining industry profitability, especially in light of likely competitor reactions?
Swot Analysis of "Ready-to-Eat Breakfast Cereal Industry in 1994 (A)" written by Kenneth Corts includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Cereals Cereal facing as an external strategic factors. Some of the topics covered in Ready-to-Eat Breakfast Cereal Industry in 1994 (A) case study are - Strategic Management Strategies, Competition, Pricing and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Ready-to-Eat Breakfast Cereal Industry in 1994 (A) casestudy better are - – technology disruption, geopolitical disruptions, there is backlash against globalization, talent flight as more people leaving formal jobs, increasing energy prices, there is increasing trade war between United States & China, wage bills are increasing,
increasing transportation and logistics costs, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Ready-to-Eat Breakfast Cereal Industry in 1994 (A)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Ready-to-Eat Breakfast Cereal Industry in 1994 (A) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Cereals Cereal, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Cereals Cereal 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 Ready-to-Eat Breakfast Cereal Industry in 1994 (A) can be done for the following purposes –
1. Strategic planning using facts provided in Ready-to-Eat Breakfast Cereal Industry in 1994 (A) case study
2. Improving business portfolio management of Cereals Cereal
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 Cereals Cereal
Strengths Ready-to-Eat Breakfast Cereal Industry in 1994 (A) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Cereals Cereal in Ready-to-Eat Breakfast Cereal Industry in 1994 (A) Harvard Business Review case study are -
Diverse revenue streams
– Cereals Cereal is present in almost all the verticals within the industry. This has provided firm in Ready-to-Eat Breakfast Cereal Industry in 1994 (A) 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.
Operational resilience
– The operational resilience strategy in the Ready-to-Eat Breakfast Cereal Industry in 1994 (A) 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.
Highly skilled collaborators
– Cereals Cereal 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 Ready-to-Eat Breakfast Cereal Industry in 1994 (A) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Training and development
– Cereals Cereal has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Ready-to-Eat Breakfast Cereal Industry in 1994 (A) 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.
Innovation driven organization
– Cereals Cereal is one of the most innovative firm in sector. Manager in Ready-to-Eat Breakfast Cereal Industry in 1994 (A) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Analytics focus
– Cereals Cereal 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 Kenneth Corts 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.
Organizational Resilience of Cereals Cereal
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Cereals Cereal does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Cereals Cereal digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Cereals Cereal 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.
Successful track record of launching new products
– Cereals Cereal has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Cereals Cereal 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 brand equity
– Cereals Cereal has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Cereals Cereal to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
High switching costs
– The high switching costs that Cereals Cereal 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.
Effective Research and Development (R&D)
– Cereals Cereal 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 Ready-to-Eat Breakfast Cereal Industry in 1994 (A) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses Ready-to-Eat Breakfast Cereal Industry in 1994 (A) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Ready-to-Eat Breakfast Cereal Industry in 1994 (A) are -
Increasing silos among functional specialists
– The organizational structure of Cereals Cereal is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Cereals Cereal needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Cereals Cereal to focus more on services rather than just following the product oriented approach.
High bargaining power of channel partners
– Because of the regulatory requirements, Kenneth Corts suggests that, Cereals Cereal 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 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 Cereals Cereal supply chain. Even after few cautionary changes mentioned in the HBR case study - Ready-to-Eat Breakfast Cereal Industry in 1994 (A), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Cereals Cereal vulnerable to further global disruptions in South East Asia.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Cereals Cereal is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Ready-to-Eat Breakfast Cereal Industry in 1994 (A) can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Lack of clear differentiation of Cereals Cereal products
– To increase the profitability and margins on the products, Cereals Cereal needs to provide more differentiated products than what it is currently offering in the marketplace.
High operating costs
– Compare to the competitors, firm in the HBR case study Ready-to-Eat Breakfast Cereal Industry in 1994 (A) 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 Cereals Cereal 's lucrative customers.
Capital Spending Reduction
– Even during the low interest decade, Cereals Cereal 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 dependence on star products
– The top 2 products and services of the firm as mentioned in the Ready-to-Eat Breakfast Cereal Industry in 1994 (A) 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 Cereals Cereal has relatively successful track record of launching new products.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Ready-to-Eat Breakfast Cereal Industry in 1994 (A), it seems that the employees of Cereals Cereal 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.
Interest costs
– Compare to the competition, Cereals Cereal 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.
Slow to strategic competitive environment developments
– As Ready-to-Eat Breakfast Cereal Industry in 1994 (A) HBR case study mentions - Cereals Cereal takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Opportunities Ready-to-Eat Breakfast Cereal Industry in 1994 (A) | 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 Ready-to-Eat Breakfast Cereal Industry in 1994 (A) are -
Better consumer reach
– The expansion of the 5G network will help Cereals Cereal to increase its market reach. Cereals Cereal 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Cereals Cereal 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 Cereals Cereal to hire the very best people irrespective of their geographical location.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Cereals Cereal is facing challenges because of the dominance of functional experts in the organization. Ready-to-Eat Breakfast Cereal Industry in 1994 (A) 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.
Loyalty marketing
– Cereals Cereal 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. Cereals Cereal can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Low interest rates
– Even though inflation is raising its head in most developed economies, Cereals Cereal 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, Cereals Cereal 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, Ready-to-Eat Breakfast Cereal Industry in 1994 (A), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Using analytics as competitive advantage
– Cereals Cereal 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 Ready-to-Eat Breakfast Cereal Industry in 1994 (A) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Cereals Cereal to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Manufacturing automation
– Cereals Cereal 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Strategy & Execution industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Cereals Cereal 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. Cereals Cereal 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
– Cereals Cereal can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Ready-to-Eat Breakfast Cereal Industry in 1994 (A) 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.
Building a culture of innovation
– managers at Cereals Cereal 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 Strategy & Execution segment.
Creating value in data economy
– The success of analytics program of Cereals Cereal has opened avenues for new revenue streams for the organization in the industry. This can help Cereals Cereal to build a more holistic ecosystem as suggested in the Ready-to-Eat Breakfast Cereal Industry in 1994 (A) case study. Cereals Cereal can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats Ready-to-Eat Breakfast Cereal Industry in 1994 (A) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Ready-to-Eat Breakfast Cereal Industry in 1994 (A) 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. Cereals Cereal 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.
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 Cereals Cereal.
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.
Stagnating economy with rate increase
– Cereals Cereal 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.
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. Cereals Cereal 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Cereals Cereal in the Strategy & Execution industry. The Strategy & Execution 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 Cereals Cereal business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Cereals Cereal 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.
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 Cereals Cereal in the Strategy & Execution sector and impact the bottomline of the organization.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Cereals Cereal with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Cereals Cereal needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Increasing wage structure of Cereals Cereal
– 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 Cereals Cereal.
Weighted SWOT Analysis of Ready-to-Eat Breakfast Cereal Industry in 1994 (A) 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 Ready-to-Eat Breakfast Cereal Industry in 1994 (A) 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 Ready-to-Eat Breakfast Cereal Industry in 1994 (A) 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 Ready-to-Eat Breakfast Cereal Industry in 1994 (A) 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 Ready-to-Eat Breakfast Cereal Industry in 1994 (A) 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 Cereals Cereal needs to make to build a sustainable competitive advantage.
