Case Study Description of Fat Angelo's: Entrepreneurial Growth
Launched in 1998, Fat Angelo's is the brainchild of three entrepreneurs who saw a void in the family-style Italian restaurants in Hong Kong. By the end of 2002, it had grown into a four-restaurant chain. Illustrates the issues facing the restaurants during their start-up and the rapid growth stages. There was an extra store adjacent to the Tsim Sha Tsui Fat Angelo's, and the entrepreneurs wanted to venture into another line of cuisine. What type of restaurant would fit? What was their final decision? What lessons did they learn?
Swot Analysis of "Fat Angelo's: Entrepreneurial Growth" written by Simon Tam, Monica Wong includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Angelo's Fat facing as an external strategic factors. Some of the topics covered in Fat Angelo's: Entrepreneurial Growth case study are - Strategic Management Strategies, Entrepreneurship, Growth strategy and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Fat Angelo's: Entrepreneurial Growth casestudy better are - – increasing government debt because of Covid-19 spendings, increasing transportation and logistics costs, digital marketing is dominated by two big players Facebook and Google, supply chains are disrupted by pandemic , increasing household debt because of falling income levels, cloud computing is disrupting traditional business models, wage bills are increasing,
there is increasing trade war between United States & China, geopolitical disruptions, etc
Introduction to SWOT Analysis of Fat Angelo's: Entrepreneurial Growth
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Fat Angelo's: Entrepreneurial Growth case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Angelo's Fat, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Angelo's Fat 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 Fat Angelo's: Entrepreneurial Growth can be done for the following purposes –
1. Strategic planning using facts provided in Fat Angelo's: Entrepreneurial Growth case study
2. Improving business portfolio management of Angelo's Fat
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 Angelo's Fat
Strengths Fat Angelo's: Entrepreneurial Growth | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Angelo's Fat in Fat Angelo's: Entrepreneurial Growth Harvard Business Review case study are -
Digital Transformation in Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Angelo's Fat digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Angelo's Fat 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.
Cross disciplinary teams
– Horizontal connected teams at the Angelo's Fat 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.
Innovation driven organization
– Angelo's Fat is one of the most innovative firm in sector. Manager in Fat Angelo's: Entrepreneurial Growth Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Ability to recruit top talent
– Angelo's Fat is one of the leading recruiters in the industry. Managers in the Fat Angelo's: Entrepreneurial Growth are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Low bargaining power of suppliers
– Suppliers of Angelo's Fat in the sector have low bargaining power. Fat Angelo's: Entrepreneurial Growth has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Angelo's Fat to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Angelo's Fat in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Analytics focus
– Angelo's Fat 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 Simon Tam, Monica Wong 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.
Effective Research and Development (R&D)
– Angelo's Fat 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 Fat Angelo's: Entrepreneurial Growth - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Highly skilled collaborators
– Angelo's Fat 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 Fat Angelo's: Entrepreneurial Growth HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High brand equity
– Angelo's Fat has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Angelo's Fat to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Angelo's Fat is present in almost all the verticals within the industry. This has provided firm in Fat Angelo's: Entrepreneurial Growth 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.
Operational resilience
– The operational resilience strategy in the Fat Angelo's: Entrepreneurial Growth 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.
Weaknesses Fat Angelo's: Entrepreneurial Growth | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Fat Angelo's: Entrepreneurial Growth are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Fat Angelo's: Entrepreneurial Growth 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 Angelo's Fat has relatively successful track record of launching new products.
Need for greater diversity
– Angelo's Fat 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 to strategic competitive environment developments
– As Fat Angelo's: Entrepreneurial Growth HBR case study mentions - Angelo's Fat 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.
Lack of clear differentiation of Angelo's Fat products
– To increase the profitability and margins on the products, Angelo's Fat needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Angelo's Fat 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Angelo's Fat is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Fat Angelo's: Entrepreneurial Growth can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Increasing silos among functional specialists
– The organizational structure of Angelo's Fat is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Angelo's Fat needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Angelo's Fat to focus more on services rather than just following the product oriented approach.
Slow decision making process
– As mentioned earlier in the report, Angelo's Fat 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. Angelo's Fat 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.
No frontier risks strategy
– After analyzing the HBR case study Fat Angelo's: Entrepreneurial Growth, 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Fat Angelo's: Entrepreneurial Growth, is just above the industry average. Angelo's Fat 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.
Products dominated business model
– Even though Angelo's Fat has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Fat Angelo's: Entrepreneurial Growth should strive to include more intangible value offerings along with its core products and services.
Opportunities Fat Angelo's: Entrepreneurial Growth | 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 Fat Angelo's: Entrepreneurial Growth are -
Using analytics as competitive advantage
– Angelo's Fat 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 Fat Angelo's: Entrepreneurial Growth - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Angelo's Fat to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Angelo's Fat 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, Angelo's Fat is facing challenges because of the dominance of functional experts in the organization. Fat Angelo's: Entrepreneurial Growth 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Angelo's Fat 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.
Buying journey improvements
– Angelo's Fat can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Fat Angelo's: Entrepreneurial Growth 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Angelo's Fat can use these opportunities to build new business models that can help the communities that Angelo's Fat operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Learning at scale
– Online learning technologies has now opened space for Angelo's Fat 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.
Creating value in data economy
– The success of analytics program of Angelo's Fat has opened avenues for new revenue streams for the organization in the industry. This can help Angelo's Fat to build a more holistic ecosystem as suggested in the Fat Angelo's: Entrepreneurial Growth case study. Angelo's Fat can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Angelo's Fat can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Angelo's Fat 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, Fat Angelo's: Entrepreneurial Growth, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Loyalty marketing
– Angelo's Fat 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Angelo's Fat 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 Angelo's Fat to hire the very best people irrespective of their geographical location.
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. Angelo's Fat 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. Angelo's Fat 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.
Threats Fat Angelo's: Entrepreneurial Growth External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Fat Angelo's: Entrepreneurial Growth are -
Technology acceleration in Forth Industrial Revolution
– Angelo's Fat has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Angelo's Fat 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.
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. Angelo's Fat 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.
Regulatory challenges
– Angelo's Fat 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.
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.
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 dependence on third party suppliers
– Angelo's Fat 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.
Increasing wage structure of Angelo's Fat
– 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 Angelo's Fat.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Angelo's Fat 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 Fat Angelo's: Entrepreneurial Growth .
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 Angelo's Fat in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Shortening product life cycle
– it is one of the major threat that Angelo's Fat 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 Angelo's Fat business can come under increasing regulations regarding data privacy, data security, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Angelo's Fat 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Fat Angelo's: Entrepreneurial Growth, Angelo's Fat may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Innovation & Entrepreneurship .
Weighted SWOT Analysis of Fat Angelo's: Entrepreneurial Growth 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 Fat Angelo's: Entrepreneurial Growth 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 Fat Angelo's: Entrepreneurial Growth 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 Fat Angelo's: Entrepreneurial Growth 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 Fat Angelo's: Entrepreneurial Growth 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 Angelo's Fat needs to make to build a sustainable competitive advantage.
