Case Study Description of Safeway, Inc.'s Leveraged Buyout (C): Media Response
Focuses exclusively on the controversy by presenting the media responses to the LBO and its aftermath, including full text of Faludi's interview with Safeway CEO Peter Magowan, and her subsequent Journal article.
Swot Analysis of "Safeway, Inc.'s Leveraged Buyout (C): Media Response" 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 Faludi's facing as an external strategic factors. Some of the topics covered in Safeway, Inc.'s Leveraged Buyout (C): Media Response 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 (C): Media Response casestudy better are - – there is backlash against globalization, technology disruption, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing transportation and logistics costs, talent flight as more people leaving formal jobs, cloud computing is disrupting traditional business models, increasing government debt because of Covid-19 spendings,
geopolitical disruptions, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of Safeway, Inc.'s Leveraged Buyout (C): Media Response
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 (C): Media Response case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Safeway Faludi's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Safeway Faludi'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 Safeway, Inc.'s Leveraged Buyout (C): Media Response can be done for the following purposes –
1. Strategic planning using facts provided in Safeway, Inc.'s Leveraged Buyout (C): Media Response case study
2. Improving business portfolio management of Safeway Faludi's
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 Faludi's
Strengths Safeway, Inc.'s Leveraged Buyout (C): Media Response | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Safeway Faludi's in Safeway, Inc.'s Leveraged Buyout (C): Media Response Harvard Business Review case study are -
Analytics focus
– Safeway Faludi's is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Karen H. Wruck, Steve-Anna Stephens 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.
Cross disciplinary teams
– Horizontal connected teams at the Safeway Faludi'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.
Ability to recruit top talent
– Safeway Faludi's is one of the leading recruiters in the industry. Managers in the Safeway, Inc.'s Leveraged Buyout (C): Media Response are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Strong track record of project management
– Safeway Faludi'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.
Learning organization
- Safeway Faludi'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 Safeway Faludi's is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Safeway, Inc.'s Leveraged Buyout (C): Media Response Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– Safeway Faludi's is one of the most innovative firm in sector. Manager in Safeway, Inc.'s Leveraged Buyout (C): Media Response Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Low bargaining power of suppliers
– Suppliers of Safeway Faludi's in the sector have low bargaining power. Safeway, Inc.'s Leveraged Buyout (C): Media Response has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Safeway Faludi's to manage not only supply disruptions but also source products at highly competitive prices.
Training and development
– Safeway Faludi's 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 (C): Media Response 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.
Superior customer experience
– The customer experience strategy of Safeway Faludi's in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Diverse revenue streams
– Safeway Faludi's is present in almost all the verticals within the industry. This has provided firm in Safeway, Inc.'s Leveraged Buyout (C): Media Response 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.
Organizational Resilience of Safeway Faludi's
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Safeway Faludi's does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Successful track record of launching new products
– Safeway Faludi's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Safeway Faludi'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.
Weaknesses Safeway, Inc.'s Leveraged Buyout (C): Media Response | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Safeway, Inc.'s Leveraged Buyout (C): Media Response are -
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Safeway, Inc.'s Leveraged Buyout (C): Media Response, is just above the industry average. Safeway Faludi'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.
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 Faludi's supply chain. Even after few cautionary changes mentioned in the HBR case study - Safeway, Inc.'s Leveraged Buyout (C): Media Response, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Safeway Faludi's vulnerable to further global disruptions in South East Asia.
Aligning sales with marketing
– It come across in the case study Safeway, Inc.'s Leveraged Buyout (C): Media Response that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Safeway, Inc.'s Leveraged Buyout (C): Media Response can leverage the sales team experience to cultivate customer relationships as Safeway Faludi's is planning to shift buying processes online.
Need for greater diversity
– Safeway Faludi's 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.
No frontier risks strategy
– After analyzing the HBR case study Safeway, Inc.'s Leveraged Buyout (C): Media Response, it seems that company is thinking about the frontier risks that can impact Finance & Accounting 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Safeway, Inc.'s Leveraged Buyout (C): Media Response, in the dynamic environment Safeway Faludi's has struggled to respond to the nimble upstart competition. Safeway Faludi's has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Capital Spending Reduction
– Even during the low interest decade, Safeway Faludi'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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Safeway, Inc.'s Leveraged Buyout (C): Media Response, it seems that the employees of Safeway Faludi's 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.
Slow decision making process
– As mentioned earlier in the report, Safeway Faludi's 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 Faludi's 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.
Lack of clear differentiation of Safeway Faludi's products
– To increase the profitability and margins on the products, Safeway Faludi's needs to provide more differentiated products than what it is currently offering in the marketplace.
Low market penetration in new markets
– Outside its home market of Safeway Faludi's, firm in the HBR case study Safeway, Inc.'s Leveraged Buyout (C): Media Response needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Opportunities Safeway, Inc.'s Leveraged Buyout (C): Media Response | 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 (C): Media Response are -
Creating value in data economy
– The success of analytics program of Safeway Faludi's has opened avenues for new revenue streams for the organization in the industry. This can help Safeway Faludi's to build a more holistic ecosystem as suggested in the Safeway, Inc.'s Leveraged Buyout (C): Media Response case study. Safeway Faludi's can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
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 Safeway Faludi'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.
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. Safeway Faludi's can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 Faludi'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. Safeway Faludi'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 Safeway Faludi's 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
– Safeway Faludi's can use the latest technology developments to improve its manufacturing and designing process in Finance & Accounting 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.
Building a culture of innovation
– managers at Safeway Faludi's can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Finance & Accounting segment.
Using analytics as competitive advantage
– Safeway Faludi's has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Safeway, Inc.'s Leveraged Buyout (C): Media Response - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Safeway Faludi's to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Loyalty marketing
– Safeway Faludi's 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Safeway Faludi'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 Finance & Accounting segment, and it will provide faster access to the consumers.
Buying journey improvements
– Safeway Faludi's can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Safeway, Inc.'s Leveraged Buyout (C): Media Response suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Better consumer reach
– The expansion of the 5G network will help Safeway Faludi's to increase its market reach. Safeway Faludi'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.
Learning at scale
– Online learning technologies has now opened space for Safeway Faludi's 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.
Threats Safeway, Inc.'s Leveraged Buyout (C): Media Response 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 (C): Media Response are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Safeway Faludi's 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.
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. Safeway Faludi's will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
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 Faludi's in the Finance & Accounting sector and impact the bottomline of the organization.
Regulatory challenges
– Safeway Faludi'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 Finance & Accounting industry regulations.
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.
Stagnating economy with rate increase
– Safeway Faludi's 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.
Environmental challenges
– Safeway Faludi'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. Safeway Faludi's can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Shortening product life cycle
– it is one of the major threat that Safeway Faludi's is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Consumer confidence and its impact on Safeway Faludi's demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
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 Faludi's business can come under increasing regulations regarding data privacy, data security, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Safeway Faludi's with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Easy access to finance
– Easy access to finance in Finance & Accounting field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Safeway Faludi's can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing wage structure of Safeway Faludi's
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Safeway Faludi's.
Weighted SWOT Analysis of Safeway, Inc.'s Leveraged Buyout (C): Media Response 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 (C): Media Response 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 (C): Media Response 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 (C): Media Response 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 (C): Media Response 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 Faludi's needs to make to build a sustainable competitive advantage.