Case Study Description of Wawa: Supply Change Management
Wawa was founded in 1803 and incorporated in 1865 as a textile manufacturer. In the early 1900s, the company opened a dairy; in 1964, Wawa Food Markets' first store was established as an outlet for dairy products. By mid-2007, Wawa, headquartered outside Philadelphia, had grown into a chain of 564 convenience stores (200 of which sold gasoline) within a 250-mile radius. A privately-owned firm, Wawa employed over 16,000 people. 2006 sales were $4.673 billion, an increase of 19.6 per cent over the prior year. Wawa was widely admired as a highly effective and humane organization with a loyal and expanding body of customers. This case addresses Wawa's supply chain management (SCM) in the context of strategic direction, organizational design, and future growth opportunities. Over an eight-year period, Wawa had transformed its supply chain from a disjointed array of pieces into a coherent, high-functioning system. Issues before the company now included (1) the relation between SCM & competitiveness; (2) the nature of the typical store, and store manager; and (3) possible expansion beyond Wawa's current area of operations. Another question concerned Wawa's stores. Historically, these places had featured a friendly, ambience where "everybody knows your name" but the company was moving towards larger, more standardized units with fewer offerings, with the goal of minimizing customer throughput time. What would this shift mean for the role of the store manager, and for the overall customer experience? Finally, to what extent was Wawa "landlocked" in its concentrated, middle-Atlantic market? Could--and should--the company attempt to export its distinctive value proposition, culture, and methods to other geographic areas?
Swot Analysis of "Wawa: Supply Change Management" written by Robert W. Keidel includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Wawa Wawa's facing as an external strategic factors. Some of the topics covered in Wawa: Supply Change Management case study are - Strategic Management Strategies, Strategy and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Wawa: Supply Change Management casestudy better are - – technology disruption, increasing household debt because of falling income levels, wage bills are increasing, supply chains are disrupted by pandemic , cloud computing is disrupting traditional business models, there is backlash against globalization, competitive advantages are harder to sustain because of technology dispersion,
there is increasing trade war between United States & China, geopolitical disruptions, etc
Introduction to SWOT Analysis of Wawa: Supply Change Management
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Wawa: Supply Change Management case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Wawa Wawa's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Wawa Wawa's 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 Wawa: Supply Change Management can be done for the following purposes –
1. Strategic planning using facts provided in Wawa: Supply Change Management case study
2. Improving business portfolio management of Wawa Wawa's
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 Wawa Wawa's
Strengths Wawa: Supply Change Management | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Wawa Wawa's in Wawa: Supply Change Management Harvard Business Review case study are -
Effective Research and Development (R&D)
– Wawa Wawa's 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 Wawa: Supply Change Management - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Wawa Wawa's digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Wawa Wawa's 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.
Innovation driven organization
– Wawa Wawa's is one of the most innovative firm in sector. Manager in Wawa: Supply Change Management Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Analytics focus
– Wawa Wawa's 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 Robert W. Keidel 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.
Low bargaining power of suppliers
– Suppliers of Wawa Wawa's in the sector have low bargaining power. Wawa: Supply Change Management has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Wawa Wawa's to manage not only supply disruptions but also source products at highly competitive prices.
Ability to lead change in Strategy & Execution field
– Wawa Wawa's 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 Wawa Wawa's in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Operational resilience
– The operational resilience strategy in the Wawa: Supply Change Management 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.
High brand equity
– Wawa Wawa's has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Wawa Wawa's to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Superior customer experience
– The customer experience strategy of Wawa Wawa's in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to recruit top talent
– Wawa Wawa's is one of the leading recruiters in the industry. Managers in the Wawa: Supply Change Management are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Strong track record of project management
– Wawa Wawa's is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Diverse revenue streams
– Wawa Wawa's is present in almost all the verticals within the industry. This has provided firm in Wawa: Supply Change Management 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.
Weaknesses Wawa: Supply Change Management | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Wawa: Supply Change Management 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 Wawa Wawa's supply chain. Even after few cautionary changes mentioned in the HBR case study - Wawa: Supply Change Management, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Wawa Wawa's vulnerable to further global disruptions in South East Asia.
High cash cycle compare to competitors
Wawa Wawa's 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.
Low market penetration in new markets
– Outside its home market of Wawa Wawa's, firm in the HBR case study Wawa: Supply Change Management needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Skills based hiring
– The stress on hiring functional specialists at Wawa Wawa's 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Wawa Wawa's needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Slow to strategic competitive environment developments
– As Wawa: Supply Change Management HBR case study mentions - Wawa Wawa's 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.
Capital Spending Reduction
– Even during the low interest decade, Wawa Wawa's 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.
Interest costs
– Compare to the competition, Wawa Wawa's 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.
Products dominated business model
– Even though Wawa Wawa's has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Wawa: Supply Change Management should strive to include more intangible value offerings along with its core products and services.
Increasing silos among functional specialists
– The organizational structure of Wawa Wawa's is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Wawa Wawa's needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Wawa Wawa's to focus more on services rather than just following the product oriented approach.
High operating costs
– Compare to the competitors, firm in the HBR case study Wawa: Supply Change Management 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 Wawa Wawa's 's lucrative customers.
Opportunities Wawa: Supply Change Management | 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 Wawa: Supply Change Management are -
Creating value in data economy
– The success of analytics program of Wawa Wawa's has opened avenues for new revenue streams for the organization in the industry. This can help Wawa Wawa's to build a more holistic ecosystem as suggested in the Wawa: Supply Change Management case study. Wawa Wawa's can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Wawa Wawa's can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Wawa Wawa's can use these opportunities to build new business models that can help the communities that Wawa Wawa's operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
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. Wawa Wawa's 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, Wawa Wawa's 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Wawa Wawa's is facing challenges because of the dominance of functional experts in the organization. Wawa: Supply Change Management 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.
Manufacturing automation
– Wawa Wawa's 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.
Using analytics as competitive advantage
– Wawa Wawa's 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 Wawa: Supply Change Management - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Wawa Wawa's to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Leveraging digital technologies
– Wawa Wawa's 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Wawa Wawa's 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, Wawa: Supply Change Management, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Building a culture of innovation
– managers at Wawa Wawa's 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.
Buying journey improvements
– Wawa Wawa's can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Wawa: Supply Change Management 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.
Better consumer reach
– The expansion of the 5G network will help Wawa Wawa's to increase its market reach. Wawa Wawa's 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.
Threats Wawa: Supply Change Management External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Wawa: Supply Change Management are -
Environmental challenges
– Wawa Wawa's 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. Wawa Wawa's can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Wawa Wawa's 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.
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.
Regulatory challenges
– Wawa Wawa's 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.
High dependence on third party suppliers
– Wawa Wawa's 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.
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. Wawa Wawa's 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.
Increasing wage structure of Wawa Wawa's
– 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 Wawa Wawa's.
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 Wawa Wawa's 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 Wawa Wawa's business can come under increasing regulations regarding data privacy, data security, etc.
Shortening product life cycle
– it is one of the major threat that Wawa Wawa's is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, 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. Wawa Wawa's needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Wawa: Supply Change Management, Wawa Wawa's 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 .
Consumer confidence and its impact on Wawa Wawa's demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Weighted SWOT Analysis of Wawa: Supply Change Management 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 Wawa: Supply Change Management 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 Wawa: Supply Change Management 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 Wawa: Supply Change Management 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 Wawa: Supply Change Management 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 Wawa Wawa's needs to make to build a sustainable competitive advantage.
