Desi Shack: Location Choice in the Big Apple SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Desi Shack: Location Choice in the Big Apple
Desi Shack is a "fast casual" restaurant, started by two HBS alumni, that serves Indian and Pakistani cuisine in midtown Manhattan. The founders are looking to expand into a second location and also plan to hire a COO, and there is very little room for error in the decision-making process if Desi Shack is to continue operating. This case discusses questions of location choice and hiring decisions, and provides an example of a framework entrepreneurs might use to think about the many factors that must go in to making these choices.
Swot Analysis of "Desi Shack: Location Choice in the Big Apple" written by William R. Kerr, Alexis Brownell includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Desi Shack facing as an external strategic factors. Some of the topics covered in Desi Shack: Location Choice in the Big Apple case study are - Strategic Management Strategies, Operations management and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Desi Shack: Location Choice in the Big Apple casestudy better are - – technology disruption, wage bills are increasing, cloud computing is disrupting traditional business models, there is backlash against globalization, increasing transportation and logistics costs, increasing government debt because of Covid-19 spendings, supply chains are disrupted by pandemic ,
increasing energy prices, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Desi Shack: Location Choice in the Big Apple
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Desi Shack: Location Choice in the Big Apple case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Desi Shack, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Desi Shack 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 Desi Shack: Location Choice in the Big Apple can be done for the following purposes –
1. Strategic planning using facts provided in Desi Shack: Location Choice in the Big Apple case study
2. Improving business portfolio management of Desi Shack
3. Assessing feasibility of the new initiative in Innovation & Entrepreneurship field.
4. Making a Innovation & Entrepreneurship topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Desi Shack
Strengths Desi Shack: Location Choice in the Big Apple | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Desi Shack in Desi Shack: Location Choice in the Big Apple Harvard Business Review case study are -
Analytics focus
– Desi Shack 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 William R. Kerr, Alexis Brownell 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.
Ability to lead change in Innovation & Entrepreneurship field
– Desi Shack 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 Desi Shack in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Superior customer experience
– The customer experience strategy of Desi Shack in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– Desi Shack: Location Choice in the Big Apple firm has clearly differentiated products in the market place. This has enabled Desi Shack to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Desi Shack to invest into research and development (R&D) and innovation.
Low bargaining power of suppliers
– Suppliers of Desi Shack in the sector have low bargaining power. Desi Shack: Location Choice in the Big Apple has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Desi Shack to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that Desi Shack has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Ability to recruit top talent
– Desi Shack is one of the leading recruiters in the industry. Managers in the Desi Shack: Location Choice in the Big Apple are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Highly skilled collaborators
– Desi Shack 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 Desi Shack: Location Choice in the Big Apple HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Operational resilience
– The operational resilience strategy in the Desi Shack: Location Choice in the Big Apple 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.
Training and development
– Desi Shack has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Desi Shack: Location Choice in the Big Apple 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.
Digital Transformation in Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Desi Shack digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Desi Shack 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.
Strong track record of project management
– Desi Shack is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses Desi Shack: Location Choice in the Big Apple | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Desi Shack: Location Choice in the Big Apple are -
Increasing silos among functional specialists
– The organizational structure of Desi Shack is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Desi Shack needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Desi Shack to focus more on services rather than just following the product oriented approach.
High operating costs
– Compare to the competitors, firm in the HBR case study Desi Shack: Location Choice in the Big Apple 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 Desi Shack 's lucrative customers.
Slow decision making process
– As mentioned earlier in the report, Desi Shack 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. Desi Shack 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.
High bargaining power of channel partners
– Because of the regulatory requirements, William R. Kerr, Alexis Brownell suggests that, Desi Shack 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.
No frontier risks strategy
– After analyzing the HBR case study Desi Shack: Location Choice in the Big Apple, it seems that company is thinking about the frontier risks that can impact Innovation & Entrepreneurship 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Desi Shack 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.
Interest costs
– Compare to the competition, Desi Shack has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
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 Desi Shack supply chain. Even after few cautionary changes mentioned in the HBR case study - Desi Shack: Location Choice in the Big Apple, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Desi Shack vulnerable to further global disruptions in South East Asia.
Need for greater diversity
– Desi Shack 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.
Low market penetration in new markets
– Outside its home market of Desi Shack, firm in the HBR case study Desi Shack: Location Choice in the Big Apple needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to strategic competitive environment developments
– As Desi Shack: Location Choice in the Big Apple HBR case study mentions - Desi Shack 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.
Opportunities Desi Shack: Location Choice in the Big Apple | 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 Desi Shack: Location Choice in the Big Apple are -
Creating value in data economy
– The success of analytics program of Desi Shack has opened avenues for new revenue streams for the organization in the industry. This can help Desi Shack to build a more holistic ecosystem as suggested in the Desi Shack: Location Choice in the Big Apple case study. Desi Shack can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Desi Shack in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Innovation & Entrepreneurship segment, and it will provide faster access to the consumers.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Desi Shack 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 Desi Shack to hire the very best people irrespective of their geographical location.
Better consumer reach
– The expansion of the 5G network will help Desi Shack to increase its market reach. Desi Shack 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Innovation & Entrepreneurship industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Desi Shack 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. Desi Shack 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.
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 Desi Shack 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Desi Shack is facing challenges because of the dominance of functional experts in the organization. Desi Shack: Location Choice in the Big Apple 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.
Loyalty marketing
– Desi Shack 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.
Leveraging digital technologies
– Desi Shack 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.
Learning at scale
– Online learning technologies has now opened space for Desi Shack 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.
Developing new processes and practices
– Desi Shack can develop new processes and procedures in Innovation & Entrepreneurship 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Desi Shack can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Desi Shack can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats Desi Shack: Location Choice in the Big Apple External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Desi Shack: Location Choice in the Big Apple are -
Regulatory challenges
– Desi Shack 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 Innovation & Entrepreneurship industry regulations.
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 Desi Shack in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Consumer confidence and its impact on Desi Shack 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Desi Shack with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Desi Shack in the Innovation & Entrepreneurship industry. The Innovation & Entrepreneurship 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Desi Shack 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 Desi Shack: Location Choice in the Big Apple .
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 Desi Shack.
Technology acceleration in Forth Industrial Revolution
– Desi Shack has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Desi Shack needs to keep up with the evolution of technology in the Innovation & Entrepreneurship 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.
Environmental challenges
– Desi Shack 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. Desi Shack can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Shortening product life cycle
– it is one of the major threat that Desi Shack is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Desi Shack business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Desi Shack 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.
Weighted SWOT Analysis of Desi Shack: Location Choice in the Big Apple 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 Desi Shack: Location Choice in the Big Apple 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 Desi Shack: Location Choice in the Big Apple 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 Desi Shack: Location Choice in the Big Apple 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 Desi Shack: Location Choice in the Big Apple 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 Desi Shack needs to make to build a sustainable competitive advantage.