Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B)
This case focuses on the topic of strategic selection, specifically whether or not the Taj Group should invest in The Pierre Hotel in New York. The case write-up includes information about the Taj Group, the Tata Group, The Pierre Hotel, the hotel industry, the Taj's domestic and international strategies, related challenges, investment options and selection criteria. It also includes various exhibits for the user to analyse: Taj's corporate holding structure, its financial highlights, strategic planning process, organisational chart, and the company's action plan development and deployment process.
Authors :: Gabriel Szulanski, Aekta Shyam, Raver Jenifer
Swot Analysis of "Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B)" written by Gabriel Szulanski, Aekta Shyam, Raver Jenifer includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Pierre Taj facing as an external strategic factors. Some of the topics covered in Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) case study are - Strategic Management Strategies, and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) casestudy better are - – technology disruption, supply chains are disrupted by pandemic , central banks are concerned over increasing inflation, geopolitical disruptions, banking and financial system is disrupted by Bitcoin and other crypto currencies, talent flight as more people leaving formal jobs, there is increasing trade war between United States & China,
cloud computing is disrupting traditional business models, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Pierre Taj, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Pierre Taj 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 Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) can be done for the following purposes –
1. Strategic planning using facts provided in Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) case study
2. Improving business portfolio management of Pierre Taj
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 Pierre Taj
Strengths Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Pierre Taj in Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) Harvard Business Review case study are -
Organizational Resilience of Pierre Taj
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Pierre Taj does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High switching costs
– The high switching costs that Pierre Taj 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.
Innovation driven organization
– Pierre Taj is one of the most innovative firm in sector. Manager in Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Effective Research and Development (R&D)
– Pierre Taj 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 Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to lead change in Strategy & Execution field
– Pierre Taj 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 Pierre Taj in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Training and development
– Pierre Taj has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) 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.
Ability to recruit top talent
– Pierre Taj is one of the leading recruiters in the industry. Managers in the Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Low bargaining power of suppliers
– Suppliers of Pierre Taj in the sector have low bargaining power. Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Pierre Taj to manage not only supply disruptions but also source products at highly competitive prices.
Highly skilled collaborators
– Pierre Taj 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 Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Learning organization
- Pierre Taj 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 Pierre Taj is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Pierre Taj 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.
Strong track record of project management
– Pierre Taj is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) are -
Skills based hiring
– The stress on hiring functional specialists at Pierre Taj 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 cash cycle compare to competitors
Pierre Taj 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B), in the dynamic environment Pierre Taj has struggled to respond to the nimble upstart competition. Pierre Taj has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High bargaining power of channel partners
– Because of the regulatory requirements, Gabriel Szulanski, Aekta Shyam, Raver Jenifer suggests that, Pierre Taj 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B), is just above the industry average. Pierre Taj 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.
Slow to strategic competitive environment developments
– As Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) HBR case study mentions - Pierre Taj 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) 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 Pierre Taj 's lucrative customers.
Low market penetration in new markets
– Outside its home market of Pierre Taj, firm in the HBR case study Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Need for greater diversity
– Pierre Taj has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) 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 Pierre Taj has relatively successful track record of launching new products.
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 Pierre Taj supply chain. Even after few cautionary changes mentioned in the HBR case study - Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Pierre Taj vulnerable to further global disruptions in South East Asia.
Opportunities Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) | 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 Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) are -
Building a culture of innovation
– managers at Pierre Taj 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.
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 Pierre Taj 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
– Pierre Taj 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 Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Pierre Taj to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Pierre Taj 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. Pierre Taj 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Strategy & Execution industry, but it has also influenced the consumer preferences. Pierre Taj can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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 Pierre Taj in the consumer business. Now Pierre Taj can target international markets with far fewer capital restrictions requirements than the existing system.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Pierre Taj 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, Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Better consumer reach
– The expansion of the 5G network will help Pierre Taj to increase its market reach. Pierre Taj 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.
Leveraging digital technologies
– Pierre Taj 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Pierre Taj 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.
Creating value in data economy
– The success of analytics program of Pierre Taj has opened avenues for new revenue streams for the organization in the industry. This can help Pierre Taj to build a more holistic ecosystem as suggested in the Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) case study. Pierre Taj can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Loyalty marketing
– Pierre Taj 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Pierre Taj 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 Pierre Taj to hire the very best people irrespective of their geographical location.
Threats Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) are -
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 Pierre Taj.
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 Pierre Taj business can come under increasing regulations regarding data privacy, data security, etc.
Regulatory challenges
– Pierre Taj 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Pierre Taj 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 Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Pierre Taj 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Pierre Taj with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Pierre Taj can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Technology acceleration in Forth Industrial Revolution
– Pierre Taj has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Pierre Taj 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.
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 Pierre Taj in the Strategy & Execution sector and impact the bottomline of the organization.
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
– Pierre Taj 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. Pierre Taj can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
High dependence on third party suppliers
– Pierre Taj 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.
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. Pierre Taj needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Weighted SWOT Analysis of Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) 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 Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) 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 Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) 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 Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) 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 Taj Hotels, Resorts & Palaces: To Pierre or not to Pierre (B) 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 Pierre Taj needs to make to build a sustainable competitive advantage.
