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 increasing trade war between United States & China, increasing energy prices, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing government debt because of Covid-19 spendings, talent flight as more people leaving formal jobs, increasing commodity prices, supply chains are disrupted by pandemic ,
central banks are concerned over increasing inflation, digital marketing is dominated by two big players Facebook and Google, 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 -
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.
Highly skilled collaborators
– Safeway Faludi's 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 Safeway, Inc.'s Leveraged Buyout (C): Media Response HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High switching costs
– The high switching costs that Safeway Faludi'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.
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.
Sustainable margins compare to other players in Finance & Accounting industry
– Safeway, Inc.'s Leveraged Buyout (C): Media Response firm has clearly differentiated products in the market place. This has enabled Safeway Faludi's to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Safeway Faludi's to invest into research and development (R&D) and innovation.
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.
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.
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.
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.
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.
Effective Research and Development (R&D)
– Safeway Faludi'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 Safeway, Inc.'s Leveraged Buyout (C): Media Response - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
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.
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 -
Skills based hiring
– The stress on hiring functional specialists at Safeway Faludi'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.
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.
Slow to strategic competitive environment developments
– As Safeway, Inc.'s Leveraged Buyout (C): Media Response HBR case study mentions - Safeway Faludi'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.
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.
High bargaining power of channel partners
– Because of the regulatory requirements, Karen H. Wruck, Steve-Anna Stephens suggests that, Safeway Faludi'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.
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.
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.
High operating costs
– Compare to the competitors, firm in the HBR case study Safeway, Inc.'s Leveraged Buyout (C): Media Response 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 Safeway Faludi's 's lucrative customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Safeway Faludi'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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Safeway Faludi's 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 (C): Media Response can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
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.
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 -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Safeway Faludi's 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, Safeway, Inc.'s Leveraged Buyout (C): Media Response, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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.
Leveraging digital technologies
– Safeway Faludi'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.
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.
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.
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.
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.
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.
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 Faludi'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 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.
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 Faludi's in the consumer business. Now Safeway Faludi's can target international markets with far fewer capital restrictions requirements than the existing system.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Safeway Faludi'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 Safeway Faludi's to hire the very best people irrespective of their geographical location.
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.
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 -
Technology acceleration in Forth Industrial Revolution
– Safeway Faludi's has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Safeway Faludi's 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.
High dependence on third party suppliers
– Safeway Faludi'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.
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.
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.
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.
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.
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.
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 Faludi's needs to understand the core reasons impacting the Finance & Accounting 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.
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.
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 (C): Media Response, Safeway Faludi'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 Finance & Accounting .
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Safeway Faludi'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 Safeway, Inc.'s Leveraged Buyout (C): Media Response .
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.
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.