The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

Case Study SWOT Analysis Solution

Case Study Description of The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version

Rey Holdings Corp. was one of the two leading supermarket chains in Panama, with an estimated 30% market share,39 stores and a five-year aggressive expansion plan. In addition, Rey Holdings held a lower market share in the pharmaceutical and food industries. In 2011, the company was evaluating growth options through: a) point-of-sales and geographical growth; b) expanding product mix and store layout; and c) a strong market entry into the pharmaceutical industry through the acquisition of Metro Corporation. CLADEA's case collection

Authors :: Sergio Andres Olavarrieta, Fatima Alves Ribeiro, Eloisa Aravena

Topics :: Strategy & Execution

Tags :: , SWOT Analysis, SWOT Matrix, TOWS, Weighted SWOT Analysis

Swot Analysis of "The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version" written by Sergio Andres Olavarrieta, Fatima Alves Ribeiro, Eloisa Aravena includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Rey Panama facing as an external strategic factors. Some of the topics covered in The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version case study are - Strategic Management Strategies, and Strategy & Execution.

Some of the macro environment factors that can be used to understand the The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version casestudy better are - – central banks are concerned over increasing inflation, increasing transportation and logistics costs, banking and financial system is disrupted by Bitcoin and other crypto currencies, digital marketing is dominated by two big players Facebook and Google, increasing household debt because of falling income levels, challanges to central banks by blockchain based private currencies, cloud computing is disrupting traditional business models, supply chains are disrupted by pandemic , technology disruption, etc

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Introduction to SWOT Analysis of The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Rey Panama, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Rey Panama 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version can be done for the following purposes –
1. Strategic planning using facts provided in The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version case study
2. Improving business portfolio management of Rey Panama
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 Rey Panama

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Strengths The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Rey Panama in The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version Harvard Business Review case study are -

Training and development

– Rey Panama has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version 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.

Sustainable margins compare to other players in Strategy & Execution industry

– The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version firm has clearly differentiated products in the market place. This has enabled Rey Panama to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Rey Panama to invest into research and development (R&D) and innovation.

Ability to recruit top talent

– Rey Panama is one of the leading recruiters in the industry. Managers in the The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.

Superior customer experience

– The customer experience strategy of Rey Panama in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Digital Transformation in Strategy & Execution segment

- digital transformation varies from industry to industry. For Rey Panama digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Rey Panama has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.

Low bargaining power of suppliers

– Suppliers of Rey Panama in the sector have low bargaining power. The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Rey Panama to manage not only supply disruptions but also source products at highly competitive prices.

Diverse revenue streams

– Rey Panama is present in almost all the verticals within the industry. This has provided firm in The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version 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.

High switching costs

– The high switching costs that Rey Panama 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

– Rey Panama 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 The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.

Innovation driven organization

– Rey Panama is one of the most innovative firm in sector. Manager in The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.

Cross disciplinary teams

– Horizontal connected teams at the Rey Panama 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.

Organizational Resilience of Rey Panama

– The covid-19 pandemic has put organizational resilience at the centre of everthing that Rey Panama does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.

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Weaknesses The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version are -

Lack of clear differentiation of Rey Panama products

– To increase the profitability and margins on the products, Rey Panama needs to provide more differentiated products than what it is currently offering in the marketplace.

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Rey Panama is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version 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 Rey Panama, firm in the HBR case study The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version 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 The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version 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 Rey Panama 's lucrative customers.

Interest costs

– Compare to the competition, Rey Panama 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, Rey Panama 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.

Compensation and incentives

– The revenue per employee as mentioned in the HBR case study The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version, is just above the industry average. Rey Panama 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.

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 Rey Panama supply chain. Even after few cautionary changes mentioned in the HBR case study - The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Rey Panama vulnerable to further global disruptions in South East Asia.

Skills based hiring

– The stress on hiring functional specialists at Rey Panama 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.

Increasing silos among functional specialists

– The organizational structure of Rey Panama is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Rey Panama needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Rey Panama to focus more on services rather than just following the product oriented approach.

No frontier risks strategy

– After analyzing the HBR case study The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version, 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.

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Opportunities The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version | 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 The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version are -

Manufacturing automation

– Rey Panama 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.

Buying journey improvements

– Rey Panama can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version 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.

Developing new processes and practices

– Rey Panama 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.

Using analytics as competitive advantage

– Rey Panama 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 The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Rey Panama to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.

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. Rey Panama can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

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 Rey Panama 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.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Rey Panama 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 Rey Panama to hire the very best people irrespective of their geographical location.

Loyalty marketing

– Rey Panama 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.

Leveraging digital technologies

– Rey Panama 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, Rey Panama 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.

Building a culture of innovation

– managers at Rey Panama 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.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Rey Panama can use these opportunities to build new business models that can help the communities that Rey Panama operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.

Better consumer reach

– The expansion of the 5G network will help Rey Panama to increase its market reach. Rey Panama 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.

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Threats The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats mentioned in the HBR case study The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version are -

Stagnating economy with rate increase

– Rey Panama 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.

Environmental challenges

– Rey Panama 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. Rey Panama can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.

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. Rey Panama needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.

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.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Rey Panama with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.

Regulatory challenges

– Rey Panama 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.

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 Rey Panama.

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. Rey Panama 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

– Rey Panama has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Rey Panama 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.

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. Rey Panama 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 Rey Panama 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 Rey Panama business can come under increasing regulations regarding data privacy, data security, etc.

High dependence on third party suppliers

– Rey Panama 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.

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Weighted SWOT Analysis of The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version 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 The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version 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 The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version 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 The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version 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 The Future of Rey Holdings Corp. in Panama: Focusing or Diversifying?, Spanish Version 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 Rey Panama needs to make to build a sustainable competitive advantage.

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