Case Study Description of Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture
Meizhou Dongpo is a large catering group in China. On June 6, 1996, the first Meizhou Dongpo Restaurant was opened in Beijing. The enterprise entered the stage of rapid development in 2000, and set up Beijing Meizhou Restaurant Management Co., Ltd. In June 2003 the business mainly covers restaurant management, catering services, food processing and sales, with its headquarters in Beijing including logistics center and central kitchen. By the end of 2013, Meizhou Dongpo Group covered six business types. Meizhou Dongpo Group has annual operating revenue of over RMB 1.8 billion, accumulative consumers of over 20 million persons-times and more than 8,000 employees. This case focuses on the starting-up process of Meizhou Dongpo Group by Wang Gang. Meizhou Dongpo has grown from a small restaurant into one of top 100 catering companies in China. This simple and arduous entrepreneurship story has been happening over the past decade in the highly competitive traditional catering industry. High technology, well-educated talent, employed manager, brand-new business model and financial support from bank or venture capital institutions cannot be found in the entrepreneurship history of Meizhou Dongpo. The case is a good attempt to analyze how did Wang Gang create and rule a catering empire by his unique leadership?
Swot Analysis of "Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture" written by F. Warren McFarlan, Weiku Wu, Jia Guo includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Meizhou Dongpo facing as an external strategic factors. Some of the topics covered in Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture case study are - Strategic Management Strategies, Leadership and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture casestudy better are - – geopolitical disruptions, there is increasing trade war between United States & China, technology disruption, talent flight as more people leaving formal jobs, 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 , challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Meizhou Dongpo, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Meizhou Dongpo 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 Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture can be done for the following purposes –
1. Strategic planning using facts provided in Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture case study
2. Improving business portfolio management of Meizhou Dongpo
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 Meizhou Dongpo
Strengths Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Meizhou Dongpo in Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture Harvard Business Review case study are -
Analytics focus
– Meizhou Dongpo 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 F. Warren McFarlan, Weiku Wu, Jia Guo 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.
Successful track record of launching new products
– Meizhou Dongpo has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Meizhou Dongpo 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.
Strong track record of project management
– Meizhou Dongpo is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Superior customer experience
– The customer experience strategy of Meizhou Dongpo in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Effective Research and Development (R&D)
– Meizhou Dongpo 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 Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Cross disciplinary teams
– Horizontal connected teams at the Meizhou Dongpo 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.
Learning organization
- Meizhou Dongpo is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Meizhou Dongpo is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
High switching costs
– The high switching costs that Meizhou Dongpo 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.
Innovation driven organization
– Meizhou Dongpo is one of the most innovative firm in sector. Manager in Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Operational resilience
– The operational resilience strategy in the Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture 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.
Diverse revenue streams
– Meizhou Dongpo is present in almost all the verticals within the industry. This has provided firm in Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture 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.
Ability to lead change in Innovation & Entrepreneurship field
– Meizhou Dongpo 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 Meizhou Dongpo in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Weaknesses Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture are -
Slow decision making process
– As mentioned earlier in the report, Meizhou Dongpo 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. Meizhou Dongpo 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 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 Meizhou Dongpo supply chain. Even after few cautionary changes mentioned in the HBR case study - Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Meizhou Dongpo vulnerable to further global disruptions in South East Asia.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Meizhou Dongpo is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture 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 Meizhou Dongpo is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Meizhou Dongpo needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Meizhou Dongpo to focus more on services rather than just following the product oriented approach.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture, in the dynamic environment Meizhou Dongpo has struggled to respond to the nimble upstart competition. Meizhou Dongpo has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Need for greater diversity
– Meizhou Dongpo 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture, it seems that the employees of Meizhou Dongpo don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture 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 Meizhou Dongpo has relatively successful track record of launching new products.
No frontier risks strategy
– After analyzing the HBR case study Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture, 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.
Products dominated business model
– Even though Meizhou Dongpo 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 - Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture should strive to include more intangible value offerings along with its core products and services.
High operating costs
– Compare to the competitors, firm in the HBR case study Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture 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 Meizhou Dongpo 's lucrative customers.
Opportunities Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture | 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 Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Meizhou Dongpo is facing challenges because of the dominance of functional experts in the organization. Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Meizhou Dongpo 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 Meizhou Dongpo to hire the very best people irrespective of their geographical location.
Loyalty marketing
– Meizhou Dongpo 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.
Creating value in data economy
– The success of analytics program of Meizhou Dongpo has opened avenues for new revenue streams for the organization in the industry. This can help Meizhou Dongpo to build a more holistic ecosystem as suggested in the Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture case study. Meizhou Dongpo can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– Meizhou Dongpo 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 Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Meizhou Dongpo to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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 Meizhou Dongpo 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.
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. Meizhou Dongpo 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. Meizhou Dongpo 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Innovation & Entrepreneurship industry, but it has also influenced the consumer preferences. Meizhou Dongpo 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 Meizhou Dongpo in the consumer business. Now Meizhou Dongpo can target international markets with far fewer capital restrictions requirements than the existing system.
Low interest rates
– Even though inflation is raising its head in most developed economies, Meizhou Dongpo 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. Meizhou Dongpo can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Better consumer reach
– The expansion of the 5G network will help Meizhou Dongpo to increase its market reach. Meizhou Dongpo 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Meizhou Dongpo can use these opportunities to build new business models that can help the communities that Meizhou Dongpo operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Threats Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture are -
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 Meizhou Dongpo in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Meizhou Dongpo with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Environmental challenges
– Meizhou Dongpo 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. Meizhou Dongpo can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
Technology acceleration in Forth Industrial Revolution
– Meizhou Dongpo has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Meizhou Dongpo 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture, Meizhou Dongpo 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 .
High dependence on third party suppliers
– Meizhou Dongpo 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 Meizhou Dongpo
– 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 Meizhou Dongpo.
Easy access to finance
– Easy access to finance in Innovation & Entrepreneurship field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Meizhou Dongpo can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Meizhou Dongpo 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.
Consumer confidence and its impact on Meizhou Dongpo 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.
Regulatory challenges
– Meizhou Dongpo 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Meizhou Dongpo 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.
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.
Weighted SWOT Analysis of Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture 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 Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture 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 Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture 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 Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture 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 Meizhou Dongpo Restaurant: Entrepreneurship, Leadership and Culture 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 Meizhou Dongpo needs to make to build a sustainable competitive advantage.