House Foods Group Inc (2810) SWOT Analysis / TOWS Matrix / MBA Resources
Food Processing
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for House Foods Group Inc (Japan)
Based on various researches at Oak Spring University , House Foods Group Inc is operating in a macro-environment that has been destablized by – wage bills are increasing, technology disruption, cloud computing is disrupting traditional business models, challanges to central banks by blockchain based private currencies, increasing household debt because of falling income levels, geopolitical disruptions, increasing commodity prices,
central banks are concerned over increasing inflation, there is backlash against globalization, etc
Introduction to SWOT Analysis of House Foods Group Inc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that House Foods Group Inc can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the House Foods Group Inc, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which House Foods Group Inc 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 House Foods Group Inc can be done for the following purposes –
1. Strategic planning of House Foods Group Inc
2. Improving business portfolio management of House Foods Group Inc
3. Assessing feasibility of the new initiative in Japan
4. Making a Food Processing sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of House Foods Group Inc
Strengths of House Foods Group Inc | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of House Foods Group Inc are -
Superior customer experience
– The customer experience strategy of House Foods Group Inc in Food Processing industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Organizational Resilience of House Foods Group Inc
– The covid-19 pandemic has put organizational resilience at the centre of everthing House Foods Group Inc does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Effective Research and Development (R&D)
– House Foods Group Inc has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – House Foods Group Inc staying ahead in the Food Processing industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Operational resilience
– The operational resilience strategy of House Foods Group Inc comprises – understanding the underlying the factors in the Food Processing 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.
Highly skilled collaborators
– House Foods Group Inc has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Food Processing industry. Secondly the value chain collaborators of House Foods Group Inc have helped the firm to develop new products and bring them quickly to the marketplace.
High brand equity
– House Foods Group Inc has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled House Foods Group Inc to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– House Foods Group Inc is one of the most innovative firm in Food Processing sector.
Ability to recruit top talent
– House Foods Group Inc is one of the leading players in the Food Processing industry in Japan. It is in a position to attract the best talent available in Japan. The firm has a robust talent identification program that helps in identifying the brightest.
Cross disciplinary teams
– Horizontal connected teams at the House Foods Group Inc 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.
High switching costs
– The high switching costs that House Foods Group Inc 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.
Successful track record of launching new products
– House Foods Group Inc has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. House Foods Group Inc 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 House Foods Group Inc in the Consumer/Non-Cyclical sector have low bargaining power. House Foods Group Inc has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps House Foods Group Inc to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses of House Foods Group Inc | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of House Foods Group Inc are -
Ability to respond to the competition
– As the decision making is very deliberative at House Foods Group Inc, in the dynamic environment of Food Processing industry it has struggled to respond to the nimble upstart competition. House Foods Group Inc has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Skills based hiring in Food Processing industry
– The stress on hiring functional specialists at House Foods Group Inc 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, House Foods Group Inc has high operating costs in the Food Processing industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract House Foods Group Inc lucrative customers.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, House Foods Group Inc is slow explore the new channels of communication. These new channels of communication can help House Foods Group Inc to provide better information regarding Food Processing products and services. It can also build an online community to further reach out to potential customers.
Compensation and incentives
– The revenue per employee of House Foods Group Inc is just above the Food Processing industry average. It 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.
Workers concerns about automation
– As automation is fast increasing in the Food Processing industry, House Foods Group Inc needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Need for greater diversity
– House Foods Group Inc 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.
Products dominated business model
– Even though House Foods Group Inc has some of the most successful models in the Food Processing industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. House Foods Group Inc should strive to include more intangible value offerings along with its core products and services.
Capital Spending Reduction
– Even during the low interest decade, House Foods Group Inc 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 Food Processing industry using digital technology.
No frontier risks strategy
– From the 10K / annual statement of House Foods Group Inc, it seems that company is thinking out the frontier risks that can impact Food Processing industry. 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.
Employees’ less understanding of House Foods Group Inc strategy
– From the outside it seems that the employees of House Foods Group Inc 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.
House Foods Group Inc Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of House Foods Group Inc are -
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Food Processing industry, but it has also influenced the consumer preferences. House Foods Group Inc can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Lowering marketing communication costs
– 5G expansion will open new opportunities for House Foods Group Inc in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Food Processing industry, and it will provide faster access to the consumers.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Food Processing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. House Foods Group Inc 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. House Foods Group Inc 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.
Building a culture of innovation
– managers at House Foods Group Inc 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 Food Processing industry.
Creating value in data economy
– The success of analytics program of House Foods Group Inc has opened avenues for new revenue streams for the organization in Food Processing industry. This can help House Foods Group Inc to build a more holistic ecosystem for House Foods Group Inc products in the Food Processing industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– House Foods Group Inc can improve the customer journey of consumers in the Food Processing industry by using analytics and artificial intelligence. It 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.
Leveraging digital technologies
– House Foods Group Inc 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, House Foods Group Inc can use these opportunities to build new business models that can help the communities that House Foods Group Inc operates in. Secondly it can use opportunities from government spending in Food Processing sector.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for House Foods Group Inc 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 House Foods Group Inc to hire the very best people irrespective of their geographical location.
Redefining models of collaboration and team work
– As explained in the weaknesses section, House Foods Group Inc is facing challenges because of the dominance of functional experts in the organization. House Foods Group Inc can utilize new technology in the field of Food Processing industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
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 House Foods Group Inc 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, House Foods Group Inc 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. House Foods Group Inc can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats House Foods Group Inc External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of House Foods Group Inc are -
Regulatory challenges
– House Foods Group Inc 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 Food Processing industry regulations.
High dependence on third party suppliers
– House Foods Group Inc 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.
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.
Increasing wage structure of House Foods Group Inc
– 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 House Foods Group Inc.
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. House Foods Group Inc needs to understand the core reasons impacting the Food Processing industry. This will help it in building a better workplace.
Stagnating economy with rate increase
– House Foods Group Inc 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 Food Processing industry.
Shortening product life cycle
– it is one of the major threat that House Foods Group Inc is facing in Food Processing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Consumer confidence and its impact on House Foods Group Inc 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 Food Processing industry and other sectors.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, House Foods Group Inc may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Food Processing sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, House Foods Group Inc 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 House Foods Group Inc prominent markets.
Easy access to finance
– Easy access to finance in Food Processing industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. House Foods Group Inc can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Technology acceleration in Forth Industrial Revolution
– House Foods Group Inc has witnessed rapid integration of technology during Covid-19 in the Food Processing industry. As one of the leading players in the industry, House Foods Group Inc needs to keep up with the evolution of technology in the Food Processing 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.
Weighted SWOT Analysis of House Foods Group Inc Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at House Foods Group Inc 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 House Foods Group Inc 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 House Foods Group Inc 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 House Foods Group Inc 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 House Foods Group Inc needs to make to build a sustainable competitive advantage.
