Kenny Rogers Roasters in China SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Kenny Rogers Roasters in China
This is a Thunderbird Case Study.Kenny Rogers Roasters (KRR) in China series consists of two cases. The Kenny Rogers Roasters in China (A) case documents the efforts of a U.S.-based fast food chain to penetrate the Chinese market in the mid-1990s. The cases focus on Tony Wang, president of Franchise Investment Corporation of Asia (FICA), as he evaluates the market potential for KRR in China and selects a joint venture partner for the first restaurant. The accompanying KRR in China (B) case focuses on site selection issues which are at the heart of Tony Wang's ambitions for the restaurant chain in China. Both the (A) and (B) cases can be taught together in a single 90-minute class.
Authors :: Allen Morrison, J. Stewart Black, Tanya Spyridakis
Swot Analysis of "Kenny Rogers Roasters in China" written by Allen Morrison, J. Stewart Black, Tanya Spyridakis includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Krr Roasters facing as an external strategic factors. Some of the topics covered in Kenny Rogers Roasters in China case study are - Strategic Management Strategies, and Global Business.
Some of the macro environment factors that can be used to understand the Kenny Rogers Roasters in China casestudy better are - – cloud computing is disrupting traditional business models, digital marketing is dominated by two big players Facebook and Google, talent flight as more people leaving formal jobs, increasing commodity prices, geopolitical disruptions, challanges to central banks by blockchain based private currencies, increasing household debt because of falling income levels,
technology disruption, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of Kenny Rogers Roasters in China
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Kenny Rogers Roasters in China case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Krr Roasters, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Krr Roasters 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 Kenny Rogers Roasters in China can be done for the following purposes –
1. Strategic planning using facts provided in Kenny Rogers Roasters in China case study
2. Improving business portfolio management of Krr Roasters
3. Assessing feasibility of the new initiative in Global Business field.
4. Making a Global Business topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Krr Roasters
Strengths Kenny Rogers Roasters in China | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Krr Roasters in Kenny Rogers Roasters in China Harvard Business Review case study are -
Successful track record of launching new products
– Krr Roasters has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Krr Roasters 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.
Superior customer experience
– The customer experience strategy of Krr Roasters in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Krr Roasters 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 Kenny Rogers Roasters in China HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Cross disciplinary teams
– Horizontal connected teams at the Krr Roasters 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.
Operational resilience
– The operational resilience strategy in the Kenny Rogers Roasters in China 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.
Organizational Resilience of Krr Roasters
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Krr Roasters does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Innovation driven organization
– Krr Roasters is one of the most innovative firm in sector. Manager in Kenny Rogers Roasters in China Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Diverse revenue streams
– Krr Roasters is present in almost all the verticals within the industry. This has provided firm in Kenny Rogers Roasters in China 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.
Low bargaining power of suppliers
– Suppliers of Krr Roasters in the sector have low bargaining power. Kenny Rogers Roasters in China has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Krr Roasters to manage not only supply disruptions but also source products at highly competitive prices.
Analytics focus
– Krr Roasters 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 Allen Morrison, J. Stewart Black, Tanya Spyridakis 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.
Training and development
– Krr Roasters has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Kenny Rogers Roasters in China 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.
Ability to recruit top talent
– Krr Roasters is one of the leading recruiters in the industry. Managers in the Kenny Rogers Roasters in China are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Weaknesses Kenny Rogers Roasters in China | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Kenny Rogers Roasters in China are -
No frontier risks strategy
– After analyzing the HBR case study Kenny Rogers Roasters in China, it seems that company is thinking about the frontier risks that can impact Global Business 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.
High cash cycle compare to competitors
Krr Roasters 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Allen Morrison, J. Stewart Black, Tanya Spyridakis suggests that, Krr Roasters 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 Krr Roasters supply chain. Even after few cautionary changes mentioned in the HBR case study - Kenny Rogers Roasters in China, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Krr Roasters vulnerable to further global disruptions in South East Asia.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Kenny Rogers Roasters in China HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Krr Roasters has relatively successful track record of launching new products.
Need for greater diversity
– Krr Roasters 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.
Slow decision making process
– As mentioned earlier in the report, Krr Roasters 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. Krr Roasters 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.
Low market penetration in new markets
– Outside its home market of Krr Roasters, firm in the HBR case study Kenny Rogers Roasters in China needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Skills based hiring
– The stress on hiring functional specialists at Krr Roasters 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Krr Roasters is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Kenny Rogers Roasters in China can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Kenny Rogers Roasters in China, is just above the industry average. Krr Roasters 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.
Opportunities Kenny Rogers Roasters in China | 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 Kenny Rogers Roasters in China are -
Leveraging digital technologies
– Krr Roasters 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Global Business industry, but it has also influenced the consumer preferences. Krr Roasters can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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 Krr Roasters in the consumer business. Now Krr Roasters can target international markets with far fewer capital restrictions requirements than the existing system.
Building a culture of innovation
– managers at Krr Roasters 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 Global Business segment.
Creating value in data economy
– The success of analytics program of Krr Roasters has opened avenues for new revenue streams for the organization in the industry. This can help Krr Roasters to build a more holistic ecosystem as suggested in the Kenny Rogers Roasters in China case study. Krr Roasters can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Better consumer reach
– The expansion of the 5G network will help Krr Roasters to increase its market reach. Krr Roasters 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.
Developing new processes and practices
– Krr Roasters can develop new processes and procedures in Global Business 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Krr Roasters is facing challenges because of the dominance of functional experts in the organization. Kenny Rogers Roasters in China 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Krr Roasters 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, Kenny Rogers Roasters in China, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Low interest rates
– Even though inflation is raising its head in most developed economies, Krr Roasters 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.
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. Krr Roasters can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Krr Roasters can use these opportunities to build new business models that can help the communities that Krr Roasters operates in. Secondly it can use opportunities from government spending in Global Business sector.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Krr Roasters can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Kenny Rogers Roasters in China External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Kenny Rogers Roasters in China are -
Regulatory challenges
– Krr Roasters 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 Global Business industry regulations.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Krr Roasters in the Global Business industry. The Global Business 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. Krr Roasters 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.
Shortening product life cycle
– it is one of the major threat that Krr Roasters is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Environmental challenges
– Krr Roasters 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. Krr Roasters can take advantage of this fund but it will also bring new competitors in the Global Business industry.
Easy access to finance
– Easy access to finance in Global Business field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Krr Roasters can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
High dependence on third party suppliers
– Krr Roasters 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Krr Roasters with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Krr Roasters.
Stagnating economy with rate increase
– Krr Roasters 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.
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. Krr Roasters needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.
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 Krr Roasters in the Global Business sector and impact the bottomline of the organization.
Increasing wage structure of Krr Roasters
– 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 Krr Roasters.
Weighted SWOT Analysis of Kenny Rogers Roasters in China 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 Kenny Rogers Roasters in China 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 Kenny Rogers Roasters in China 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 Kenny Rogers Roasters in China 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 Kenny Rogers Roasters in China 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 Krr Roasters needs to make to build a sustainable competitive advantage.
