Case Study Description of Loblaw Companies Limited: Analyzing an Annual Report 2012
The systematic analysis of an annual report of a large Canadian public company provides a framework and a set of skills and concepts to determine whether it is worth investing in the company. The detailed examination of the annual report includes an analysis of profitability - including return on capital employed, return on equity, return on sales, gross profit margin and asset turnover - and liquidity measures.
Swot Analysis of "Loblaw Companies Limited: Analyzing an Annual Report 2012" written by Murray J. Bryant includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Report Annual facing as an external strategic factors. Some of the topics covered in Loblaw Companies Limited: Analyzing an Annual Report 2012 case study are - Strategic Management Strategies, and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Loblaw Companies Limited: Analyzing an Annual Report 2012 casestudy better are - – increasing government debt because of Covid-19 spendings, geopolitical disruptions, talent flight as more people leaving formal jobs, wage bills are increasing, there is increasing trade war between United States & China, increasing energy prices, increasing inequality as vast percentage of new income is going to the top 1%,
increasing commodity prices, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Loblaw Companies Limited: Analyzing an Annual Report 2012
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Loblaw Companies Limited: Analyzing an Annual Report 2012 case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Report Annual, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Report Annual 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 Loblaw Companies Limited: Analyzing an Annual Report 2012 can be done for the following purposes –
1. Strategic planning using facts provided in Loblaw Companies Limited: Analyzing an Annual Report 2012 case study
2. Improving business portfolio management of Report Annual
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 Report Annual
Strengths Loblaw Companies Limited: Analyzing an Annual Report 2012 | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Report Annual in Loblaw Companies Limited: Analyzing an Annual Report 2012 Harvard Business Review case study are -
Ability to recruit top talent
– Report Annual is one of the leading recruiters in the industry. Managers in the Loblaw Companies Limited: Analyzing an Annual Report 2012 are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Ability to lead change in Finance & Accounting field
– Report Annual 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 Report Annual in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High brand equity
– Report Annual has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Report Annual to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Superior customer experience
– The customer experience strategy of Report Annual in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Report Annual 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 Loblaw Companies Limited: Analyzing an Annual Report 2012 HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Report Annual digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Report Annual has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Training and development
– Report Annual has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Loblaw Companies Limited: Analyzing an Annual Report 2012 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)
– Report Annual 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 Loblaw Companies Limited: Analyzing an Annual Report 2012 - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Sustainable margins compare to other players in Finance & Accounting industry
– Loblaw Companies Limited: Analyzing an Annual Report 2012 firm has clearly differentiated products in the market place. This has enabled Report Annual to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Report Annual to invest into research and development (R&D) and innovation.
Operational resilience
– The operational resilience strategy in the Loblaw Companies Limited: Analyzing an Annual Report 2012 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.
Innovation driven organization
– Report Annual is one of the most innovative firm in sector. Manager in Loblaw Companies Limited: Analyzing an Annual Report 2012 Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
High switching costs
– The high switching costs that Report Annual 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 Loblaw Companies Limited: Analyzing an Annual Report 2012 | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Loblaw Companies Limited: Analyzing an Annual Report 2012 are -
Low market penetration in new markets
– Outside its home market of Report Annual, firm in the HBR case study Loblaw Companies Limited: Analyzing an Annual Report 2012 needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Increasing silos among functional specialists
– The organizational structure of Report Annual is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Report Annual needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Report Annual to focus more on services rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As Loblaw Companies Limited: Analyzing an Annual Report 2012 HBR case study mentions - Report Annual 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Loblaw Companies Limited: Analyzing an Annual Report 2012, in the dynamic environment Report Annual has struggled to respond to the nimble upstart competition. Report Annual has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Lack of clear differentiation of Report Annual products
– To increase the profitability and margins on the products, Report Annual needs to provide more differentiated products than what it is currently offering in the marketplace.
High bargaining power of channel partners
– Because of the regulatory requirements, Murray J. Bryant suggests that, Report Annual 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 operating costs
– Compare to the competitors, firm in the HBR case study Loblaw Companies Limited: Analyzing an Annual Report 2012 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 Report Annual 's lucrative customers.
Capital Spending Reduction
– Even during the low interest decade, Report Annual 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.
Skills based hiring
– The stress on hiring functional specialists at Report Annual 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.
High cash cycle compare to competitors
Report Annual has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Aligning sales with marketing
– It come across in the case study Loblaw Companies Limited: Analyzing an Annual Report 2012 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 Loblaw Companies Limited: Analyzing an Annual Report 2012 can leverage the sales team experience to cultivate customer relationships as Report Annual is planning to shift buying processes online.
Opportunities Loblaw Companies Limited: Analyzing an Annual Report 2012 | 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 Loblaw Companies Limited: Analyzing an Annual Report 2012 are -
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Report Annual can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Report Annual is facing challenges because of the dominance of functional experts in the organization. Loblaw Companies Limited: Analyzing an Annual Report 2012 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.
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 Report Annual 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Report Annual can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Leveraging digital technologies
– Report Annual 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.
Using analytics as competitive advantage
– Report Annual 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 Loblaw Companies Limited: Analyzing an Annual Report 2012 - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Report Annual to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Report Annual 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 Report Annual to hire the very best people irrespective of their geographical location.
Building a culture of innovation
– managers at Report Annual 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.
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. Report Annual can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Report Annual can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Report Annual can use these opportunities to build new business models that can help the communities that Report Annual operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Report Annual 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, Loblaw Companies Limited: Analyzing an Annual Report 2012, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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 Report Annual in the consumer business. Now Report Annual can target international markets with far fewer capital restrictions requirements than the existing system.
Threats Loblaw Companies Limited: Analyzing an Annual Report 2012 External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Loblaw Companies Limited: Analyzing an Annual Report 2012 are -
Shortening product life cycle
– it is one of the major threat that Report Annual is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Regulatory challenges
– Report Annual 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 Report Annual business can come under increasing regulations regarding data privacy, data security, etc.
Environmental challenges
– Report Annual 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. Report Annual can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Report Annual with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Report Annual 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 Loblaw Companies Limited: Analyzing an Annual Report 2012 .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Report Annual 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.
Technology acceleration in Forth Industrial Revolution
– Report Annual has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Report Annual 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.
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. Report Annual 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.
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. Report Annual can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Report Annual in the Finance & Accounting sector and impact the bottomline of the organization.
Stagnating economy with rate increase
– Report Annual 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.
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.
Weighted SWOT Analysis of Loblaw Companies Limited: Analyzing an Annual Report 2012 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 Loblaw Companies Limited: Analyzing an Annual Report 2012 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 Loblaw Companies Limited: Analyzing an Annual Report 2012 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 Loblaw Companies Limited: Analyzing an Annual Report 2012 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 Loblaw Companies Limited: Analyzing an Annual Report 2012 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 Report Annual needs to make to build a sustainable competitive advantage.