Lagom Kitchen + Brewery: A Quest for Survival SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Lagom Kitchen + Brewery: A Quest for Survival
On the evening of September 30, 2016, the founder and chief executive officer of Lagom Kitchen + Brewery (Lagom) surveyed his newly opened microbrewery and restaurant with pride. He had put a great deal of hard work, time, and money into this venture; in the past two years, Lagom had required an investment of US$1 million. Yet the business's Gurgaon location, within India's Delhi National Capital Region, had failed to deliver the footfall that the founder had expected. Lagom was at the centre of an information technology corporate park where more than 10,000 employees worked, and was surrounded by many business parks and malls. However, fewer companies had moved into these spaces than anticipated, which was affecting Lagom's sales. Should the founder alter Lagom's product offerings or increase the price of the menu items? Should he increase the focus on corporate customers by undertaking exclusive tie-ups, or should he increase Lagom's social marketing efforts to attract customers from nearby condominiums? Lagom's founder had only two weeks to act before the restaurant's financial situation became critical. The authors Sanjeev Pathak and Rajesh Pillania are affiliated with Management Development Institute.
Swot Analysis of "Lagom Kitchen + Brewery: A Quest for Survival" written by Sanjeev Pathak, Rajesh Pillania includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Lagom Lagom's facing as an external strategic factors. Some of the topics covered in Lagom Kitchen + Brewery: A Quest for Survival case study are - Strategic Management Strategies, and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Lagom Kitchen + Brewery: A Quest for Survival casestudy better are - – increasing commodity prices, wage bills are increasing, banking and financial system is disrupted by Bitcoin and other crypto currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing household debt because of falling income levels, competitive advantages are harder to sustain because of technology dispersion, supply chains are disrupted by pandemic ,
increasing energy prices, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Lagom Kitchen + Brewery: A Quest for Survival
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Lagom Kitchen + Brewery: A Quest for Survival case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Lagom Lagom's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Lagom Lagom'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 Lagom Kitchen + Brewery: A Quest for Survival can be done for the following purposes –
1. Strategic planning using facts provided in Lagom Kitchen + Brewery: A Quest for Survival case study
2. Improving business portfolio management of Lagom Lagom's
3. Assessing feasibility of the new initiative in Innovation & Entrepreneurship field.
4. Making a Innovation & Entrepreneurship topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Lagom Lagom's
Strengths Lagom Kitchen + Brewery: A Quest for Survival | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Lagom Lagom's in Lagom Kitchen + Brewery: A Quest for Survival Harvard Business Review case study are -
Strong track record of project management
– Lagom Lagom'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.
Ability to recruit top talent
– Lagom Lagom's is one of the leading recruiters in the industry. Managers in the Lagom Kitchen + Brewery: A Quest for Survival are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Training and development
– Lagom Lagom's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Lagom Kitchen + Brewery: A Quest for Survival 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.
Successful track record of launching new products
– Lagom Lagom's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Lagom Lagom's 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.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– Lagom Kitchen + Brewery: A Quest for Survival firm has clearly differentiated products in the market place. This has enabled Lagom Lagom's to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Lagom Lagom's to invest into research and development (R&D) and innovation.
Learning organization
- Lagom Lagom's 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 Lagom Lagom's is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Lagom Kitchen + Brewery: A Quest for Survival Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Organizational Resilience of Lagom Lagom's
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Lagom Lagom's does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Effective Research and Development (R&D)
– Lagom Lagom'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 Lagom Kitchen + Brewery: A Quest for Survival - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Innovation driven organization
– Lagom Lagom's is one of the most innovative firm in sector. Manager in Lagom Kitchen + Brewery: A Quest for Survival Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Ability to lead change in Innovation & Entrepreneurship field
– Lagom Lagom'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 Lagom Lagom's in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Cross disciplinary teams
– Horizontal connected teams at the Lagom Lagom's 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.
High switching costs
– The high switching costs that Lagom Lagom's 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.
Weaknesses Lagom Kitchen + Brewery: A Quest for Survival | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Lagom Kitchen + Brewery: A Quest for Survival are -
Skills based hiring
– The stress on hiring functional specialists at Lagom Lagom'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.
Lack of clear differentiation of Lagom Lagom's products
– To increase the profitability and margins on the products, Lagom Lagom's needs to provide more differentiated products than what it is currently offering in the marketplace.
Products dominated business model
– Even though Lagom Lagom'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 - Lagom Kitchen + Brewery: A Quest for Survival should strive to include more intangible value offerings along with its core products and services.
Workers concerns about automation
– As automation is fast increasing in the segment, Lagom Lagom'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.
High bargaining power of channel partners
– Because of the regulatory requirements, Sanjeev Pathak, Rajesh Pillania suggests that, Lagom Lagom's 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.
Increasing silos among functional specialists
– The organizational structure of Lagom Lagom's is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Lagom Lagom's needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Lagom Lagom's to focus more on services rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As Lagom Kitchen + Brewery: A Quest for Survival HBR case study mentions - Lagom Lagom'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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Lagom Kitchen + Brewery: A Quest for Survival 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 Lagom Lagom's has relatively successful track record of launching new products.
Capital Spending Reduction
– Even during the low interest decade, Lagom Lagom'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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Lagom Kitchen + Brewery: A Quest for Survival, is just above the industry average. Lagom Lagom's 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.
No frontier risks strategy
– After analyzing the HBR case study Lagom Kitchen + Brewery: A Quest for Survival, it seems that company is thinking about the frontier risks that can impact Innovation & Entrepreneurship 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.
Opportunities Lagom Kitchen + Brewery: A Quest for Survival | 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 Lagom Kitchen + Brewery: A Quest for Survival are -
Creating value in data economy
– The success of analytics program of Lagom Lagom's has opened avenues for new revenue streams for the organization in the industry. This can help Lagom Lagom's to build a more holistic ecosystem as suggested in the Lagom Kitchen + Brewery: A Quest for Survival case study. Lagom Lagom's can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Innovation & Entrepreneurship industry, but it has also influenced the consumer preferences. Lagom Lagom's can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Lagom Lagom's in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Innovation & Entrepreneurship segment, and it will provide faster access to the consumers.
Better consumer reach
– The expansion of the 5G network will help Lagom Lagom's to increase its market reach. Lagom Lagom'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.
Leveraging digital technologies
– Lagom Lagom'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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Lagom Lagom's is facing challenges because of the dominance of functional experts in the organization. Lagom Kitchen + Brewery: A Quest for Survival 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Innovation & Entrepreneurship industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Lagom Lagom's can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Lagom Lagom's can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Lagom Lagom's can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Lagom Lagom's 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 Lagom Lagom's to hire the very best people irrespective of their geographical location.
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 Lagom Lagom's 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 Lagom Lagom's in the consumer business. Now Lagom Lagom's can target international markets with far fewer capital restrictions requirements than the existing system.
Buying journey improvements
– Lagom Lagom's can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Lagom Kitchen + Brewery: A Quest for Survival 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
– Lagom Lagom's can develop new processes and procedures in Innovation & Entrepreneurship 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.
Threats Lagom Kitchen + Brewery: A Quest for Survival External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Lagom Kitchen + Brewery: A Quest for Survival are -
Regulatory challenges
– Lagom Lagom'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 Innovation & Entrepreneurship 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 Lagom Lagom's.
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.
Easy access to finance
– Easy access to finance in Innovation & Entrepreneurship field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Lagom Lagom's can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Lagom Lagom's needs to understand the core reasons impacting the Innovation & Entrepreneurship 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 Lagom Lagom's with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Lagom Lagom's in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Lagom Lagom's 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 Lagom Kitchen + Brewery: A Quest for Survival .
High dependence on third party suppliers
– Lagom Lagom'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.
Environmental challenges
– Lagom Lagom'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. Lagom Lagom's can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
Technology acceleration in Forth Industrial Revolution
– Lagom Lagom's has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Lagom Lagom's needs to keep up with the evolution of technology in the Innovation & Entrepreneurship 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Lagom Kitchen + Brewery: A Quest for Survival, Lagom Lagom'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 Innovation & Entrepreneurship .
Weighted SWOT Analysis of Lagom Kitchen + Brewery: A Quest for Survival 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 Lagom Kitchen + Brewery: A Quest for Survival 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 Lagom Kitchen + Brewery: A Quest for Survival 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 Lagom Kitchen + Brewery: A Quest for Survival 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 Lagom Kitchen + Brewery: A Quest for Survival 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 Lagom Lagom's needs to make to build a sustainable competitive advantage.