H.J. Heinz Co.: The Administration of Policy (A) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of H.J. Heinz Co.: The Administration of Policy (A)
Relates the April 1979 discovery of improper income transferal practices used at the H.J. Heinz Co. Background data on the company is presented, along with a detailed description of the organizational practices, the management incentive system, and the corporate ethical policy then in use. Also contains an organization chart and financial data for the 1972-78 fiscal years.
Swot Analysis of "H.J. Heinz Co.: The Administration of Policy (A)" written by Kenneth E. Goodpaster, Richard J. Post includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that H.j Heinz facing as an external strategic factors. Some of the topics covered in H.J. Heinz Co.: The Administration of Policy (A) case study are - Strategic Management Strategies, Boards, Business processes, Compensation, Ethics, Government, Motivating people, Organizational structure, Social responsibility and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the H.J. Heinz Co.: The Administration of Policy (A) casestudy better are - – technology disruption, central banks are concerned over increasing inflation, cloud computing is disrupting traditional business models, competitive advantages are harder to sustain because of technology dispersion, increasing household debt because of falling income levels, increasing commodity prices, geopolitical disruptions,
increasing inequality as vast percentage of new income is going to the top 1%, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
Introduction to SWOT Analysis of H.J. Heinz Co.: The Administration of Policy (A)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in H.J. Heinz Co.: The Administration of Policy (A) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the H.j Heinz, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which H.j Heinz 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 H.J. Heinz Co.: The Administration of Policy (A) can be done for the following purposes –
1. Strategic planning using facts provided in H.J. Heinz Co.: The Administration of Policy (A) case study
2. Improving business portfolio management of H.j Heinz
3. Assessing feasibility of the new initiative in Leadership & Managing People field.
4. Making a Leadership & Managing People topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of H.j Heinz
Strengths H.J. Heinz Co.: The Administration of Policy (A) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of H.j Heinz in H.J. Heinz Co.: The Administration of Policy (A) Harvard Business Review case study are -
Ability to recruit top talent
– H.j Heinz is one of the leading recruiters in the industry. Managers in the H.J. Heinz Co.: The Administration of Policy (A) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
High brand equity
– H.j Heinz has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled H.j Heinz to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Superior customer experience
– The customer experience strategy of H.j Heinz in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Operational resilience
– The operational resilience strategy in the H.J. Heinz Co.: The Administration of Policy (A) 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.
Ability to lead change in Leadership & Managing People field
– H.j Heinz 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 H.j Heinz in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Cross disciplinary teams
– Horizontal connected teams at the H.j Heinz 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
– H.j Heinz is one of the most innovative firm in sector. Manager in H.J. Heinz Co.: The Administration of Policy (A) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Highly skilled collaborators
– H.j Heinz 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 H.J. Heinz Co.: The Administration of Policy (A) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of H.j Heinz
– The covid-19 pandemic has put organizational resilience at the centre of everthing that H.j Heinz does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Effective Research and Development (R&D)
– H.j Heinz 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 H.J. Heinz Co.: The Administration of Policy (A) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Low bargaining power of suppliers
– Suppliers of H.j Heinz in the sector have low bargaining power. H.J. Heinz Co.: The Administration of Policy (A) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps H.j Heinz to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that H.j Heinz has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Weaknesses H.J. Heinz Co.: The Administration of Policy (A) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of H.J. Heinz Co.: The Administration of Policy (A) are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, H.j Heinz is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study H.J. Heinz Co.: The Administration of Policy (A) can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Low market penetration in new markets
– Outside its home market of H.j Heinz, firm in the HBR case study H.J. Heinz Co.: The Administration of Policy (A) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High cash cycle compare to competitors
H.j Heinz 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.
Need for greater diversity
– H.j Heinz 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.
Increasing silos among functional specialists
– The organizational structure of H.j Heinz is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. H.j Heinz needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help H.j Heinz to focus more on services rather than just following the product oriented approach.
High bargaining power of channel partners
– Because of the regulatory requirements, Kenneth E. Goodpaster, Richard J. Post suggests that, H.j Heinz 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.
Products dominated business model
– Even though H.j Heinz 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 - H.J. Heinz Co.: The Administration of Policy (A) should strive to include more intangible value offerings along with its core products and services.
Skills based hiring
– The stress on hiring functional specialists at H.j Heinz has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
High operating costs
– Compare to the competitors, firm in the HBR case study H.J. Heinz Co.: The Administration of Policy (A) 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 H.j Heinz 's lucrative customers.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the H.J. Heinz Co.: The Administration of Policy (A) 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 H.j Heinz has relatively successful track record of launching new products.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study H.J. Heinz Co.: The Administration of Policy (A), in the dynamic environment H.j Heinz has struggled to respond to the nimble upstart competition. H.j Heinz has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Opportunities H.J. Heinz Co.: The Administration of Policy (A) | 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 H.J. Heinz Co.: The Administration of Policy (A) are -
Low interest rates
– Even though inflation is raising its head in most developed economies, H.j Heinz 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.
Creating value in data economy
– The success of analytics program of H.j Heinz has opened avenues for new revenue streams for the organization in the industry. This can help H.j Heinz to build a more holistic ecosystem as suggested in the H.J. Heinz Co.: The Administration of Policy (A) case study. H.j Heinz can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Manufacturing automation
– H.j Heinz can use the latest technology developments to improve its manufacturing and designing process in Leadership & Managing People segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Leadership & Managing People industry, but it has also influenced the consumer preferences. H.j Heinz can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Buying journey improvements
– H.j Heinz can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. H.J. Heinz Co.: The Administration of Policy (A) 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, H.j Heinz is facing challenges because of the dominance of functional experts in the organization. H.J. Heinz Co.: The Administration of Policy (A) 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects H.j Heinz 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, H.j Heinz 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, H.J. Heinz Co.: The Administration of Policy (A), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Better consumer reach
– The expansion of the 5G network will help H.j Heinz to increase its market reach. H.j Heinz 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, H.j Heinz can use these opportunities to build new business models that can help the communities that H.j Heinz operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Using analytics as competitive advantage
– H.j Heinz 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 H.J. Heinz Co.: The Administration of Policy (A) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help H.j Heinz to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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 H.j Heinz in the consumer business. Now H.j Heinz can target international markets with far fewer capital restrictions requirements than the existing system.
Building a culture of innovation
– managers at H.j Heinz 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 Leadership & Managing People segment.
Threats H.J. Heinz Co.: The Administration of Policy (A) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study H.J. Heinz Co.: The Administration of Policy (A) are -
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 H.j Heinz business can come under increasing regulations regarding data privacy, data security, etc.
Regulatory challenges
– H.j Heinz 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 Leadership & Managing People industry regulations.
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for H.j Heinz in the Leadership & Managing People industry. The Leadership & Managing People 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 wage structure of H.j Heinz
– 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 H.j Heinz.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study H.J. Heinz Co.: The Administration of Policy (A), H.j Heinz may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Leadership & Managing People .
High dependence on third party suppliers
– H.j Heinz 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.
Shortening product life cycle
– it is one of the major threat that H.j Heinz is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Technology acceleration in Forth Industrial Revolution
– H.j Heinz has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, H.j Heinz needs to keep up with the evolution of technology in the Leadership & Managing People 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.
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. H.j Heinz needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
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. H.j Heinz 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.
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 H.j Heinz in the Leadership & Managing People sector and impact the bottomline of the organization.
Consumer confidence and its impact on H.j Heinz 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.
Weighted SWOT Analysis of H.J. Heinz Co.: The Administration of Policy (A) 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 H.J. Heinz Co.: The Administration of Policy (A) 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 H.J. Heinz Co.: The Administration of Policy (A) 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 H.J. Heinz Co.: The Administration of Policy (A) 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 H.J. Heinz Co.: The Administration of Policy (A) 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 H.j Heinz needs to make to build a sustainable competitive advantage.
