SWOT Analysis / TOWS Matrix for Peel Hotels (United Kingdom)
Based on various researches at Oak Spring University , Peel Hotels is operating in a macro-environment that has been destablized by – increasing inequality as vast percentage of new income is going to the top 1%, challanges to central banks by blockchain based private currencies, geopolitical disruptions, banking and financial system is disrupted by Bitcoin and other crypto currencies, digital marketing is dominated by two big players Facebook and Google, increasing energy prices, competitive advantages are harder to sustain because of technology dispersion,
increasing transportation and logistics costs, wage bills are increasing, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Peel Hotels can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Peel Hotels, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Peel Hotels 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 Peel Hotels can be done for the following purposes –
1. Strategic planning of Peel Hotels
2. Improving business portfolio management of Peel Hotels
3. Assessing feasibility of the new initiative in United Kingdom
4. Making a Hotels & Motels sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Peel Hotels
Strengths of Peel Hotels | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Peel Hotels are -
High switching costs
– The high switching costs that Peel Hotels 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.
Analytics focus
– Peel Hotels 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 Hotels & Motels industry. The technology infrastructure of United Kingdom is also helping 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
– Peel Hotels has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Peel Hotels 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.
Organizational Resilience of Peel Hotels
– The covid-19 pandemic has put organizational resilience at the centre of everthing Peel Hotels does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to lead change in Hotels & Motels
– Peel Hotels is one of the leading players in the Hotels & Motels industry in United Kingdom. Over the years it has not only transformed the business landscape in the Hotels & Motels industry in United Kingdom but also across the existing markets. The ability to lead change has enabled Peel Hotels in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Strong track record of project management in the Hotels & Motels industry
– Peel Hotels is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Innovation driven organization
– Peel Hotels is one of the most innovative firm in Hotels & Motels sector.
Training and development
– Peel Hotels has one of the best training and development program in Services industry. The effectiveness of the training programs can be measured in – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Diverse revenue streams
– Peel Hotels is present in almost all the verticals within the Hotels & Motels industry. This has provided Peel Hotels 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.
Superior customer experience
– The customer experience strategy of Peel Hotels in Hotels & Motels industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Effective Research and Development (R&D)
– Peel Hotels has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Peel Hotels staying ahead in the Hotels & Motels 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 Peel Hotels 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.
Weaknesses of Peel Hotels | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Peel Hotels are -
Aligning sales with marketing
– From the outside it seems that Peel Hotels needs to have more collaboration between its sales team and marketing team. Sales professionals in the Hotels & Motels industry have deep experience in developing customer relationships. Marketing department at Peel Hotels can leverage the sales team experience to cultivate customer relationships as Peel Hotels is planning to shift buying processes online.
High dependence on Peel Hotels ‘s star products
– The top 2 products and services of Peel Hotels still accounts for major business revenue. This dependence on star products in Hotels & Motels industry has resulted into insufficient focus on developing new products, even though Peel Hotels has relatively successful track record of launching new products.
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 Peel Hotels supply chain. Even after few cautionary changes, Peel Hotels is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Peel Hotels vulnerable to further global disruptions in South East Asia.
Need for greater diversity
– Peel Hotels 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.
Capital Spending Reduction
– Even during the low interest decade, Peel Hotels 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 Hotels & Motels industry using digital technology.
Interest costs
– Compare to the competition, Peel Hotels has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Slow to strategic competitive environment developments
– As Peel Hotels is one of the leading players in the Hotels & Motels industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Hotels & Motels industry in last five years.
Compensation and incentives
– The revenue per employee of Peel Hotels is just above the Hotels & Motels 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Peel Hotels is slow explore the new channels of communication. These new channels of communication can help Peel Hotels to provide better information regarding Hotels & Motels products and services. It can also build an online community to further reach out to potential customers.
High bargaining power of channel partners in Hotels & Motels industry
– because of the regulatory requirements in United Kingdom, Peel Hotels 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 Hotels & Motels industry.
Lack of clear differentiation of Peel Hotels products
– To increase the profitability and margins on the products, Peel Hotels needs to provide more differentiated products than what it is currently offering in the marketplace.
Peel Hotels Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Peel Hotels are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Peel Hotels 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 Peel Hotels to hire the very best people irrespective of their geographical location.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Hotels & Motels industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Peel Hotels 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. Peel Hotels 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.
Loyalty marketing
– Peel Hotels 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.
Better consumer reach
– The expansion of the 5G network will help Peel Hotels to increase its market reach. Peel Hotels 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Peel Hotels can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Peel Hotels in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Hotels & Motels industry, and it will provide faster access to the consumers.
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. Peel Hotels can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Leveraging digital technologies
– Peel Hotels 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Peel Hotels 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 Peel Hotels to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Using analytics as competitive advantage
– Peel Hotels has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Hotels & Motels sector. This continuous investment in analytics has enabled Peel Hotels to build a competitive advantage using analytics. The analytics driven competitive advantage can help Peel Hotels to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Creating value in data economy
– The success of analytics program of Peel Hotels has opened avenues for new revenue streams for the organization in Hotels & Motels industry. This can help Peel Hotels to build a more holistic ecosystem for Peel Hotels products in the Hotels & Motels industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Manufacturing automation
– Peel Hotels can use the latest technology developments to improve its manufacturing and designing process in Hotels & Motels sector. 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Peel Hotels 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.
Threats Peel Hotels External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Peel Hotels are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Peel Hotels 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 Peel Hotels prominent markets.
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 Peel Hotels business can come under increasing regulations regarding data privacy, data security, etc.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Hotels & Motels industry are lowering. It can presents Peel Hotels with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Hotels & Motels sector.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Peel Hotels may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Hotels & Motels sector.
Regulatory challenges
– Peel Hotels 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 Hotels & Motels industry regulations.
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 Peel Hotels in the Hotels & Motels sector and impact the bottomline of the organization.
Consumer confidence and its impact on Peel Hotels 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 Hotels & Motels industry and other sectors.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Peel Hotels in Hotels & Motels industry. The Hotels & Motels 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.
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.
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. Peel Hotels 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.
Stagnating economy with rate increase
– Peel Hotels 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 Hotels & Motels industry.
Easy access to finance
– Easy access to finance in Hotels & Motels industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Peel Hotels can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of Peel Hotels Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Peel Hotels 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 Peel Hotels 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 Peel Hotels 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 Peel Hotels 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 Peel Hotels needs to make to build a sustainable competitive advantage.