Swot Analysis of "Frito-Lay, Inc.: The Navigator Project (B)" written by Lynda M. Applegate, Richard O. Mason, Melinda B. Conrad includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Navigator Frito facing as an external strategic factors. Some of the topics covered in Frito-Lay, Inc.: The Navigator Project (B) case study are - Strategic Management Strategies, IT, Strategy execution and Technology & Operations.
Some of the macro environment factors that can be used to understand the Frito-Lay, Inc.: The Navigator Project (B) casestudy better are - – increasing government debt because of Covid-19 spendings, increasing transportation and logistics costs, central banks are concerned over increasing inflation, competitive advantages are harder to sustain because of technology dispersion, wage bills are increasing, challanges to central banks by blockchain based private currencies, increasing household debt because of falling income levels,
cloud computing is disrupting traditional business models, there is backlash against globalization, etc
Introduction to SWOT Analysis of Frito-Lay, Inc.: The Navigator Project (B)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Frito-Lay, Inc.: The Navigator Project (B) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Navigator Frito, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Navigator Frito 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 Frito-Lay, Inc.: The Navigator Project (B) can be done for the following purposes –
1. Strategic planning using facts provided in Frito-Lay, Inc.: The Navigator Project (B) case study
2. Improving business portfolio management of Navigator Frito
3. Assessing feasibility of the new initiative in Technology & Operations field.
4. Making a Technology & Operations topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Navigator Frito
Strengths Frito-Lay, Inc.: The Navigator Project (B) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Navigator Frito in Frito-Lay, Inc.: The Navigator Project (B) Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of Navigator Frito in the sector have low bargaining power. Frito-Lay, Inc.: The Navigator Project (B) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Navigator Frito to manage not only supply disruptions but also source products at highly competitive prices.
Highly skilled collaborators
– Navigator Frito 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 Frito-Lay, Inc.: The Navigator Project (B) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Learning organization
- Navigator Frito 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 Navigator Frito is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Frito-Lay, Inc.: The Navigator Project (B) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Successful track record of launching new products
– Navigator Frito has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Navigator Frito 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.
Effective Research and Development (R&D)
– Navigator Frito 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 Frito-Lay, Inc.: The Navigator Project (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.
Superior customer experience
– The customer experience strategy of Navigator Frito in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to recruit top talent
– Navigator Frito is one of the leading recruiters in the industry. Managers in the Frito-Lay, Inc.: The Navigator Project (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.
Innovation driven organization
– Navigator Frito is one of the most innovative firm in sector. Manager in Frito-Lay, Inc.: The Navigator Project (B) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
High switching costs
– The high switching costs that Navigator Frito 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.
Sustainable margins compare to other players in Technology & Operations industry
– Frito-Lay, Inc.: The Navigator Project (B) firm has clearly differentiated products in the market place. This has enabled Navigator Frito to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Navigator Frito to invest into research and development (R&D) and innovation.
Training and development
– Navigator Frito has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Frito-Lay, Inc.: The Navigator Project (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.
Organizational Resilience of Navigator Frito
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Navigator Frito does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses Frito-Lay, Inc.: The Navigator Project (B) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Frito-Lay, Inc.: The Navigator Project (B) are -
Products dominated business model
– Even though Navigator Frito 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 - Frito-Lay, Inc.: The Navigator Project (B) should strive to include more intangible value offerings along with its core products and services.
Skills based hiring
– The stress on hiring functional specialists at Navigator Frito 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Navigator Frito is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Frito-Lay, Inc.: The Navigator Project (B) can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
High cash cycle compare to competitors
Navigator Frito 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Navigator Frito 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.
Interest costs
– Compare to the competition, Navigator Frito 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Frito-Lay, Inc.: The Navigator Project (B), in the dynamic environment Navigator Frito has struggled to respond to the nimble upstart competition. Navigator Frito has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Frito-Lay, Inc.: The Navigator Project (B), it seems that the employees of Navigator Frito 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Frito-Lay, Inc.: The Navigator Project (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 Navigator Frito has relatively successful track record of launching new products.
High bargaining power of channel partners
– Because of the regulatory requirements, Lynda M. Applegate, Richard O. Mason, Melinda B. Conrad suggests that, Navigator Frito 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.
Lack of clear differentiation of Navigator Frito products
– To increase the profitability and margins on the products, Navigator Frito needs to provide more differentiated products than what it is currently offering in the marketplace.
Opportunities Frito-Lay, Inc.: The Navigator Project (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 Frito-Lay, Inc.: The Navigator Project (B) are -
Creating value in data economy
– The success of analytics program of Navigator Frito has opened avenues for new revenue streams for the organization in the industry. This can help Navigator Frito to build a more holistic ecosystem as suggested in the Frito-Lay, Inc.: The Navigator Project (B) case study. Navigator Frito can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Leveraging digital technologies
– Navigator Frito 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.
Better consumer reach
– The expansion of the 5G network will help Navigator Frito to increase its market reach. Navigator Frito 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.
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 Navigator Frito 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Navigator Frito can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Manufacturing automation
– Navigator Frito can use the latest technology developments to improve its manufacturing and designing process in Technology & Operations 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Navigator Frito 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 Navigator Frito 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 Technology & Operations segment.
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. Navigator Frito can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Developing new processes and practices
– Navigator Frito can develop new processes and procedures in Technology & Operations 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Navigator Frito 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, Frito-Lay, Inc.: The Navigator Project (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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Navigator Frito 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 Navigator Frito to hire the very best people irrespective of their geographical location.
Buying journey improvements
– Navigator Frito can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Frito-Lay, Inc.: The Navigator Project (B) 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.
Threats Frito-Lay, Inc.: The Navigator Project (B) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Frito-Lay, Inc.: The Navigator Project (B) are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Navigator Frito in the Technology & Operations industry. The Technology & Operations 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.
Easy access to finance
– Easy access to finance in Technology & Operations field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Navigator Frito 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.
Regulatory challenges
– Navigator Frito 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 Technology & Operations industry regulations.
Stagnating economy with rate increase
– Navigator Frito 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.
Consumer confidence and its impact on Navigator Frito 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.
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.
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 Navigator Frito business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Navigator Frito 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Navigator Frito 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 Frito-Lay, Inc.: The Navigator Project (B) .
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. Navigator Frito 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Navigator Frito 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. Navigator Frito needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
Weighted SWOT Analysis of Frito-Lay, Inc.: The Navigator Project (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 Frito-Lay, Inc.: The Navigator Project (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 Frito-Lay, Inc.: The Navigator Project (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 Frito-Lay, Inc.: The Navigator Project (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 Frito-Lay, Inc.: The Navigator Project (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 Navigator Frito needs to make to build a sustainable competitive advantage.