The owner of a food truck based in Hamilton, Ontario, was looking over the first year of her operations. In addition to working in Hamilton, she had tried to maximize her revenues by driving to several other cities and charging various prices for each burger, depending partly on the fresh ingredients available in each city. Besides location, the owner had collected data on a few other factors-the weather, the day of the week, the city's population, and whether a festival was going on-that had had an impact on the demand for her product. She wondered whether analytics could help her decide where to sell and how much to charge on a daily basis. The owner also wondered whether this decision-making and data-collection process could be automated since she would be using it every day.
Authors :: Mehmet Begen, Jen Littleton, Samantha Wong, Rob Yellin
Swot Analysis of "Food Truck Forecaster" written by Mehmet Begen, Jen Littleton, Samantha Wong, Rob Yellin includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Hamilton Truck facing as an external strategic factors. Some of the topics covered in Food Truck Forecaster case study are - Strategic Management Strategies, Forecasting and Technology & Operations.
Some of the macro environment factors that can be used to understand the Food Truck Forecaster casestudy better are - – competitive advantages are harder to sustain because of technology dispersion, supply chains are disrupted by pandemic , banking and financial system is disrupted by Bitcoin and other crypto currencies, geopolitical disruptions, increasing inequality as vast percentage of new income is going to the top 1%, talent flight as more people leaving formal jobs, technology disruption,
digital marketing is dominated by two big players Facebook and Google, there is backlash against globalization, etc
Introduction to SWOT Analysis of Food Truck Forecaster
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Food Truck Forecaster case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Hamilton Truck, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Hamilton Truck 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 Food Truck Forecaster can be done for the following purposes –
1. Strategic planning using facts provided in Food Truck Forecaster case study
2. Improving business portfolio management of Hamilton Truck
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 Hamilton Truck
Strengths Food Truck Forecaster | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Hamilton Truck in Food Truck Forecaster Harvard Business Review case study are -
Analytics focus
– Hamilton Truck 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 Mehmet Begen, Jen Littleton, Samantha Wong, Rob Yellin 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.
Strong track record of project management
– Hamilton Truck is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Organizational Resilience of Hamilton Truck
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Hamilton Truck does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– Hamilton Truck has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Food Truck Forecaster 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
– Hamilton Truck is one of the leading recruiters in the industry. Managers in the Food Truck Forecaster are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
High brand equity
– Hamilton Truck has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Hamilton Truck to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Effective Research and Development (R&D)
– Hamilton Truck 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 Food Truck Forecaster - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Sustainable margins compare to other players in Technology & Operations industry
– Food Truck Forecaster firm has clearly differentiated products in the market place. This has enabled Hamilton Truck to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Hamilton Truck to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Hamilton Truck 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.
Highly skilled collaborators
– Hamilton Truck 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 Food Truck Forecaster HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– Hamilton Truck has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Hamilton Truck 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.
Learning organization
- Hamilton Truck 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 Hamilton Truck is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Food Truck Forecaster Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses Food Truck Forecaster | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Food Truck Forecaster are -
Increasing silos among functional specialists
– The organizational structure of Hamilton Truck is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Hamilton Truck needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Hamilton Truck to focus more on services rather than just following the product oriented approach.
Interest costs
– Compare to the competition, Hamilton Truck 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.
Low market penetration in new markets
– Outside its home market of Hamilton Truck, firm in the HBR case study Food Truck Forecaster 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 Food Truck Forecaster 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 Hamilton Truck 's lucrative customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Hamilton Truck 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.
Lack of clear differentiation of Hamilton Truck products
– To increase the profitability and margins on the products, Hamilton Truck needs to provide more differentiated products than what it is currently offering in the marketplace.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Food Truck Forecaster, it seems that the employees of Hamilton Truck 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 bargaining power of channel partners
– Because of the regulatory requirements, Mehmet Begen, Jen Littleton, Samantha Wong, Rob Yellin suggests that, Hamilton Truck 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.
Slow to strategic competitive environment developments
– As Food Truck Forecaster HBR case study mentions - Hamilton Truck 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 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 Hamilton Truck supply chain. Even after few cautionary changes mentioned in the HBR case study - Food Truck Forecaster, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Hamilton Truck vulnerable to further global disruptions in South East Asia.
Capital Spending Reduction
– Even during the low interest decade, Hamilton Truck 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.
Opportunities Food Truck Forecaster | 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 Food Truck Forecaster are -
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. Hamilton Truck can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Using analytics as competitive advantage
– Hamilton Truck 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 Food Truck Forecaster - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Hamilton Truck to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Learning at scale
– Online learning technologies has now opened space for Hamilton Truck to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Low interest rates
– Even though inflation is raising its head in most developed economies, Hamilton Truck 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, Hamilton Truck is facing challenges because of the dominance of functional experts in the organization. Food Truck Forecaster 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
– Hamilton Truck 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.
Loyalty marketing
– Hamilton Truck 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.
Creating value in data economy
– The success of analytics program of Hamilton Truck has opened avenues for new revenue streams for the organization in the industry. This can help Hamilton Truck to build a more holistic ecosystem as suggested in the Food Truck Forecaster case study. Hamilton Truck can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Developing new processes and practices
– Hamilton Truck 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Technology & Operations industry, but it has also influenced the consumer preferences. Hamilton Truck can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Hamilton Truck 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, Food Truck Forecaster, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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 Hamilton Truck 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.
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 Hamilton Truck in the consumer business. Now Hamilton Truck can target international markets with far fewer capital restrictions requirements than the existing system.
Threats Food Truck Forecaster External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Food Truck Forecaster are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Food Truck Forecaster, Hamilton Truck may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Technology & Operations .
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. Hamilton Truck 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 Hamilton Truck
– 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 Hamilton Truck.
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.
Consumer confidence and its impact on Hamilton Truck 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.
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 Hamilton Truck in the Technology & Operations sector and impact the bottomline of the organization.
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 Hamilton Truck.
Stagnating economy with rate increase
– Hamilton Truck 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.
Shortening product life cycle
– it is one of the major threat that Hamilton Truck is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Hamilton Truck 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 Food Truck Forecaster .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Hamilton Truck 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.
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. Hamilton Truck needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
Environmental challenges
– Hamilton Truck 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. Hamilton Truck can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
Weighted SWOT Analysis of Food Truck Forecaster 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 Food Truck Forecaster 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 Food Truck Forecaster 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 Food Truck Forecaster 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 Food Truck Forecaster 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 Hamilton Truck needs to make to build a sustainable competitive advantage.
