Food Store of the Northern Lakes Cooperative SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Food Store of the Northern Lakes Cooperative
A survival strategy was needed for the Food Store department of the Northern Lakes Cooperative. The 85-person Food Store department, one of eleven departments at the Northern Lakes Cooperative, had not been profitable for years. While not profitable, it served the needs of its Co-op members by providing a grocery service and serving as an anchor in the Co-op Mall.
Authors :: Barry C. Foltos, Carol J. Gaumer, Amit J. Shah
Swot Analysis of "Food Store of the Northern Lakes Cooperative" written by Barry C. Foltos, Carol J. Gaumer, Amit J. Shah includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Lakes Cooperative facing as an external strategic factors. Some of the topics covered in Food Store of the Northern Lakes Cooperative case study are - Strategic Management Strategies, Marketing, Performance measurement and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Food Store of the Northern Lakes Cooperative casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, banking and financial system is disrupted by Bitcoin and other crypto currencies, challanges to central banks by blockchain based private currencies, increasing inequality as vast percentage of new income is going to the top 1%, technology disruption, supply chains are disrupted by pandemic , talent flight as more people leaving formal jobs,
central banks are concerned over increasing inflation, increasing energy prices, etc
Introduction to SWOT Analysis of Food Store of the Northern Lakes Cooperative
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Food Store of the Northern Lakes Cooperative case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Lakes Cooperative, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Lakes Cooperative 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 Food Store of the Northern Lakes Cooperative can be done for the following purposes –
1. Strategic planning using facts provided in Food Store of the Northern Lakes Cooperative case study
2. Improving business portfolio management of Lakes Cooperative
3. Assessing feasibility of the new initiative in Finance & Accounting field.
4. Making a Finance & Accounting topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Lakes Cooperative
Strengths Food Store of the Northern Lakes Cooperative | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Lakes Cooperative in Food Store of the Northern Lakes Cooperative Harvard Business Review case study are -
Training and development
– Lakes Cooperative has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Food Store of the Northern Lakes Cooperative 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.
Cross disciplinary teams
– Horizontal connected teams at the Lakes Cooperative 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.
Highly skilled collaborators
– Lakes Cooperative 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 Food Store of the Northern Lakes Cooperative HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High switching costs
– The high switching costs that Lakes Cooperative 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.
Organizational Resilience of Lakes Cooperative
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Lakes Cooperative does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Sustainable margins compare to other players in Finance & Accounting industry
– Food Store of the Northern Lakes Cooperative firm has clearly differentiated products in the market place. This has enabled Lakes Cooperative to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Lakes Cooperative to invest into research and development (R&D) and innovation.
Ability to lead change in Finance & Accounting field
– Lakes Cooperative 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 Lakes Cooperative in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Diverse revenue streams
– Lakes Cooperative is present in almost all the verticals within the industry. This has provided firm in Food Store of the Northern Lakes Cooperative 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.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Lakes Cooperative digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Lakes Cooperative 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.
Successful track record of launching new products
– Lakes Cooperative has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Lakes Cooperative 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.
Low bargaining power of suppliers
– Suppliers of Lakes Cooperative in the sector have low bargaining power. Food Store of the Northern Lakes Cooperative has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Lakes Cooperative to manage not only supply disruptions but also source products at highly competitive prices.
Operational resilience
– The operational resilience strategy in the Food Store of the Northern Lakes Cooperative 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 Food Store of the Northern Lakes Cooperative | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Food Store of the Northern Lakes Cooperative are -
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Food Store of the Northern Lakes Cooperative, in the dynamic environment Lakes Cooperative has struggled to respond to the nimble upstart competition. Lakes Cooperative has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Food Store of the Northern Lakes Cooperative, is just above the industry average. Lakes Cooperative 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.
Aligning sales with marketing
– It come across in the case study Food Store of the Northern Lakes Cooperative that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Food Store of the Northern Lakes Cooperative can leverage the sales team experience to cultivate customer relationships as Lakes Cooperative is planning to shift buying processes online.
High operating costs
– Compare to the competitors, firm in the HBR case study Food Store of the Northern Lakes Cooperative 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 Lakes Cooperative 's lucrative customers.
Lack of clear differentiation of Lakes Cooperative products
– To increase the profitability and margins on the products, Lakes Cooperative needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Lakes Cooperative is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Food Store of the Northern Lakes Cooperative 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 Lakes Cooperative is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Lakes Cooperative needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Lakes Cooperative to focus more on services rather than just following the product oriented approach.
Skills based hiring
– The stress on hiring functional specialists at Lakes Cooperative 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 dependence on star products
– The top 2 products and services of the firm as mentioned in the Food Store of the Northern Lakes Cooperative 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 Lakes Cooperative has relatively successful track record of launching new products.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Food Store of the Northern Lakes Cooperative, it seems that the employees of Lakes Cooperative 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.
Capital Spending Reduction
– Even during the low interest decade, Lakes Cooperative has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Opportunities Food Store of the Northern Lakes Cooperative | 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 Food Store of the Northern Lakes Cooperative are -
Loyalty marketing
– Lakes Cooperative 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.
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 Lakes Cooperative in the consumer business. Now Lakes Cooperative can target international markets with far fewer capital restrictions requirements than the existing system.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Lakes Cooperative in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Finance & Accounting segment, and it will provide faster access to the consumers.
Creating value in data economy
– The success of analytics program of Lakes Cooperative has opened avenues for new revenue streams for the organization in the industry. This can help Lakes Cooperative to build a more holistic ecosystem as suggested in the Food Store of the Northern Lakes Cooperative case study. Lakes Cooperative can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Better consumer reach
– The expansion of the 5G network will help Lakes Cooperative to increase its market reach. Lakes Cooperative will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Developing new processes and practices
– Lakes Cooperative can develop new processes and procedures in Finance & Accounting 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.
Leveraging digital technologies
– Lakes Cooperative 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Finance & Accounting industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Lakes Cooperative 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. Lakes Cooperative 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Lakes Cooperative 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, Food Store of the Northern Lakes Cooperative, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Building a culture of innovation
– managers at Lakes Cooperative 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 Finance & Accounting segment.
Using analytics as competitive advantage
– Lakes Cooperative 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 Food Store of the Northern Lakes Cooperative - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Lakes Cooperative to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Lakes Cooperative can use these opportunities to build new business models that can help the communities that Lakes Cooperative operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Lakes Cooperative is facing challenges because of the dominance of functional experts in the organization. Food Store of the Northern Lakes Cooperative 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.
Threats Food Store of the Northern Lakes Cooperative External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Food Store of the Northern Lakes Cooperative 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 Lakes Cooperative in the Finance & Accounting sector and impact the bottomline of the organization.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Lakes Cooperative in the Finance & Accounting industry. The Finance & Accounting 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.
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 Lakes Cooperative business can come under increasing regulations regarding data privacy, data security, etc.
Easy access to finance
– Easy access to finance in Finance & Accounting field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Lakes Cooperative can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Lakes Cooperative.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Lakes Cooperative with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Lakes Cooperative 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 Food Store of the Northern Lakes Cooperative .
Environmental challenges
– Lakes Cooperative 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. Lakes Cooperative can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Shortening product life cycle
– it is one of the major threat that Lakes Cooperative is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Consumer confidence and its impact on Lakes Cooperative 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
– Lakes Cooperative 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 Finance & Accounting industry regulations.
Stagnating economy with rate increase
– Lakes Cooperative can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Weighted SWOT Analysis of Food Store of the Northern Lakes Cooperative 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 Food Store of the Northern Lakes Cooperative 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 Food Store of the Northern Lakes Cooperative 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 Food Store of the Northern Lakes Cooperative 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 Food Store of the Northern Lakes Cooperative 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 Lakes Cooperative needs to make to build a sustainable competitive advantage.
