Swot Analysis of "Safeway, Inc.'s Leveraged Buyout (B)" written by Karen H. Wruck, Steve-Anna Stephens includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Safeway Buyout facing as an external strategic factors. Some of the topics covered in Safeway, Inc.'s Leveraged Buyout (B) case study are - Strategic Management Strategies, Corporate governance, Labor, Mergers & acquisitions, Public relations, Reorganization and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Safeway, Inc.'s Leveraged Buyout (B) casestudy better are - – competitive advantages are harder to sustain because of technology dispersion, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing energy prices, increasing government debt because of Covid-19 spendings, talent flight as more people leaving formal jobs, wage bills are increasing, central banks are concerned over increasing inflation,
technology disruption, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of Safeway, Inc.'s Leveraged Buyout (B)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Safeway, Inc.'s Leveraged Buyout (B) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Safeway Buyout, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Safeway Buyout 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 Safeway, Inc.'s Leveraged Buyout (B) can be done for the following purposes –
1. Strategic planning using facts provided in Safeway, Inc.'s Leveraged Buyout (B) case study
2. Improving business portfolio management of Safeway Buyout
3. Assessing feasibility of the new initiative in Finance & Accounting field.
4. Making a Finance & Accounting topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Safeway Buyout
Strengths Safeway, Inc.'s Leveraged Buyout (B) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Safeway Buyout in Safeway, Inc.'s Leveraged Buyout (B) Harvard Business Review case study are -
Cross disciplinary teams
– Horizontal connected teams at the Safeway Buyout 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.
Superior customer experience
– The customer experience strategy of Safeway Buyout in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Strong track record of project management
– Safeway Buyout is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Innovation driven organization
– Safeway Buyout is one of the most innovative firm in sector. Manager in Safeway, Inc.'s Leveraged Buyout (B) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Training and development
– Safeway Buyout has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Safeway, Inc.'s Leveraged Buyout (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.
High brand equity
– Safeway Buyout has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Safeway Buyout to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Learning organization
- Safeway Buyout 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 Safeway Buyout is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Safeway, Inc.'s Leveraged Buyout (B) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Effective Research and Development (R&D)
– Safeway Buyout 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 Safeway, Inc.'s Leveraged Buyout (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.
High switching costs
– The high switching costs that Safeway Buyout 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.
Ability to lead change in Finance & Accounting field
– Safeway Buyout 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 Safeway Buyout 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 Safeway, Inc.'s Leveraged Buyout (B) 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.
Diverse revenue streams
– Safeway Buyout is present in almost all the verticals within the industry. This has provided firm in Safeway, Inc.'s Leveraged Buyout (B) 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 Safeway, Inc.'s Leveraged Buyout (B) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Safeway, Inc.'s Leveraged Buyout (B) are -
Increasing silos among functional specialists
– The organizational structure of Safeway Buyout is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Safeway Buyout needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Safeway Buyout to focus more on services rather than just following the product oriented approach.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Safeway, Inc.'s Leveraged Buyout (B), is just above the industry average. Safeway Buyout 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Safeway Buyout is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Safeway, Inc.'s Leveraged Buyout (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 bargaining power of channel partners
– Because of the regulatory requirements, Karen H. Wruck, Steve-Anna Stephens suggests that, Safeway Buyout 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.
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 Safeway Buyout supply chain. Even after few cautionary changes mentioned in the HBR case study - Safeway, Inc.'s Leveraged Buyout (B), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Safeway Buyout vulnerable to further global disruptions in South East Asia.
Lack of clear differentiation of Safeway Buyout products
– To increase the profitability and margins on the products, Safeway Buyout needs to provide more differentiated products than what it is currently offering in the marketplace.
Skills based hiring
– The stress on hiring functional specialists at Safeway Buyout 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.
Need for greater diversity
– Safeway Buyout has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Safeway, Inc.'s Leveraged Buyout (B), in the dynamic environment Safeway Buyout has struggled to respond to the nimble upstart competition. Safeway Buyout has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to strategic competitive environment developments
– As Safeway, Inc.'s Leveraged Buyout (B) HBR case study mentions - Safeway Buyout 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.
Slow decision making process
– As mentioned earlier in the report, Safeway Buyout has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Safeway Buyout even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Opportunities Safeway, Inc.'s Leveraged Buyout (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 Safeway, Inc.'s Leveraged Buyout (B) are -
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 Safeway Buyout in the consumer business. Now Safeway Buyout can target international markets with far fewer capital restrictions requirements than the existing system.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Finance & Accounting industry, but it has also influenced the consumer preferences. Safeway Buyout can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Leveraging digital technologies
– Safeway Buyout 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.
Loyalty marketing
– Safeway Buyout 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.
Better consumer reach
– The expansion of the 5G network will help Safeway Buyout to increase its market reach. Safeway Buyout 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.
Learning at scale
– Online learning technologies has now opened space for Safeway Buyout 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.
Creating value in data economy
– The success of analytics program of Safeway Buyout has opened avenues for new revenue streams for the organization in the industry. This can help Safeway Buyout to build a more holistic ecosystem as suggested in the Safeway, Inc.'s Leveraged Buyout (B) case study. Safeway Buyout 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 Safeway Buyout can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Building a culture of innovation
– managers at Safeway Buyout 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 Finance & Accounting segment.
Developing new processes and practices
– Safeway Buyout can develop new processes and procedures in Finance & Accounting 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Safeway Buyout in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Finance & Accounting segment, and it will provide faster access to the consumers.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Finance & Accounting industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Safeway Buyout 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. Safeway Buyout 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.
Buying journey improvements
– Safeway Buyout can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Safeway, Inc.'s Leveraged Buyout (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 Safeway, Inc.'s Leveraged Buyout (B) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Safeway, Inc.'s Leveraged Buyout (B) 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 Safeway, Inc.'s Leveraged Buyout (B), Safeway Buyout may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Finance & Accounting .
Regulatory challenges
– Safeway Buyout 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 Finance & Accounting industry regulations.
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 Safeway Buyout business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Safeway Buyout 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.
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. Safeway Buyout needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
Technology acceleration in Forth Industrial Revolution
– Safeway Buyout has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Safeway Buyout needs to keep up with the evolution of technology in the Finance & Accounting 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.
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.
Shortening product life cycle
– it is one of the major threat that Safeway Buyout is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Stagnating economy with rate increase
– Safeway Buyout 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Safeway Buyout 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 Safeway, Inc.'s Leveraged Buyout (B) .
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 Safeway Buyout.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Safeway Buyout in the Finance & Accounting industry. The Finance & Accounting 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.
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 Safeway Buyout in the Finance & Accounting sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Safeway, Inc.'s Leveraged Buyout (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 Safeway, Inc.'s Leveraged Buyout (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 Safeway, Inc.'s Leveraged Buyout (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 Safeway, Inc.'s Leveraged Buyout (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 Safeway, Inc.'s Leveraged Buyout (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 Safeway Buyout needs to make to build a sustainable competitive advantage.