Based on various researches at Oak Spring University , Southern Concepts Restaurant is operating in a macro-environment that has been destablized by – increasing transportation and logistics costs, there is backlash against globalization, increasing energy prices, cloud computing is disrupting traditional business models, talent flight as more people leaving formal jobs, there is increasing trade war between United States & China, supply chains are disrupted by pandemic ,
increasing government debt because of Covid-19 spendings, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of Southern Concepts Restaurant
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Southern Concepts Restaurant can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Southern Concepts Restaurant, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Southern Concepts Restaurant 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 Southern Concepts Restaurant can be done for the following purposes –
1. Strategic planning of Southern Concepts Restaurant
2. Improving business portfolio management of Southern Concepts Restaurant
3. Assessing feasibility of the new initiative in United States
4. Making a Restaurants sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Southern Concepts Restaurant
Strengths of Southern Concepts Restaurant | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Southern Concepts Restaurant are -
Low bargaining power of suppliers
– Suppliers of Southern Concepts Restaurant in the Services sector have low bargaining power. Southern Concepts Restaurant has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Southern Concepts Restaurant to manage not only supply disruptions but also source products at highly competitive prices.
Cross disciplinary teams
– Horizontal connected teams at the Southern Concepts Restaurant 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
– Southern Concepts Restaurant has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Restaurants industry. Secondly the value chain collaborators of Southern Concepts Restaurant have helped the firm to develop new products and bring them quickly to the marketplace.
Effective Research and Development (R&D)
– Southern Concepts Restaurant has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Southern Concepts Restaurant staying ahead in the Restaurants industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Sustainable margins compare to other players in Restaurants industry
– Southern Concepts Restaurant has clearly differentiated products in the market place. This has enabled Southern Concepts Restaurant to fetch slight price premium compare to the competitors in the Restaurants industry. The sustainable margins have also helped Southern Concepts Restaurant to invest into research and development (R&D) and innovation.
Strong track record of project management in the Restaurants industry
– Southern Concepts Restaurant is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Organizational Resilience of Southern Concepts Restaurant
– The covid-19 pandemic has put organizational resilience at the centre of everthing Southern Concepts Restaurant does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– Southern Concepts Restaurant 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.
Learning organization
- Southern Concepts Restaurant is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Southern Concepts Restaurant is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Southern Concepts Restaurant emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– Southern Concepts Restaurant is one of the leading players in the Restaurants industry in United States. It is in a position to attract the best talent available in United States. The firm has a robust talent identification program that helps in identifying the brightest.
Diverse revenue streams
– Southern Concepts Restaurant is present in almost all the verticals within the Restaurants industry. This has provided Southern Concepts Restaurant 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.
Operational resilience
– The operational resilience strategy of Southern Concepts Restaurant comprises – understanding the underlying the factors in the Restaurants 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 of Southern Concepts Restaurant | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Southern Concepts Restaurant are -
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 Southern Concepts Restaurant supply chain. Even after few cautionary changes, Southern Concepts Restaurant is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Southern Concepts Restaurant vulnerable to further global disruptions in South East Asia.
Employees’ less understanding of Southern Concepts Restaurant strategy
– From the outside it seems that the employees of Southern Concepts Restaurant don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
High dependence on Southern Concepts Restaurant ‘s star products
– The top 2 products and services of Southern Concepts Restaurant still accounts for major business revenue. This dependence on star products in Restaurants industry has resulted into insufficient focus on developing new products, even though Southern Concepts Restaurant has relatively successful track record of launching new products.
Skills based hiring in Restaurants industry
– The stress on hiring functional specialists at Southern Concepts Restaurant 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.
Increasing silos among functional specialists
– The organizational structure of Southern Concepts Restaurant is dominated by functional specialists. It is not different from other players in the Restaurants industry, but Southern Concepts Restaurant needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Southern Concepts Restaurant to focus more on services in the Restaurants industry rather than just following the product oriented approach.
Need for greater diversity
– Southern Concepts Restaurant 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.
Ability to respond to the competition
– As the decision making is very deliberative at Southern Concepts Restaurant, in the dynamic environment of Restaurants industry it has struggled to respond to the nimble upstart competition. Southern Concepts Restaurant has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Capital Spending Reduction
– Even during the low interest decade, Southern Concepts Restaurant 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 Restaurants industry using digital technology.
High cash cycle compare to competitors
Southern Concepts Restaurant has a high cash cycle compare to other players in the Restaurants industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Slow to strategic competitive environment developments
– As Southern Concepts Restaurant is one of the leading players in the Restaurants industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Restaurants industry in last five years.
No frontier risks strategy
– From the 10K / annual statement of Southern Concepts Restaurant, it seems that company is thinking out the frontier risks that can impact Restaurants 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.
Southern Concepts Restaurant Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Southern Concepts Restaurant are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Southern Concepts Restaurant can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Learning at scale
– Online learning technologies has now opened space for Southern Concepts Restaurant to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
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. Southern Concepts Restaurant can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Building a culture of innovation
– managers at Southern Concepts Restaurant 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 Restaurants industry.
Using analytics as competitive advantage
– Southern Concepts Restaurant has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Restaurants sector. This continuous investment in analytics has enabled Southern Concepts Restaurant to build a competitive advantage using analytics. The analytics driven competitive advantage can help Southern Concepts Restaurant 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, Southern Concepts Restaurant can use these opportunities to build new business models that can help the communities that Southern Concepts Restaurant operates in. Secondly it can use opportunities from government spending in Restaurants sector.
Leveraging digital technologies
– Southern Concepts Restaurant 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.
Better consumer reach
– The expansion of the 5G network will help Southern Concepts Restaurant to increase its market reach. Southern Concepts Restaurant 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Southern Concepts Restaurant 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Restaurants industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Southern Concepts Restaurant 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. Southern Concepts Restaurant 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, Southern Concepts Restaurant 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 Southern Concepts Restaurant to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Loyalty marketing
– Southern Concepts Restaurant 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.
Developing new processes and practices
– Southern Concepts Restaurant can develop new processes and procedures in Restaurants 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.
Threats Southern Concepts Restaurant External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Southern Concepts Restaurant are -
Regulatory challenges
– Southern Concepts Restaurant 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 Restaurants industry regulations.
Technology acceleration in Forth Industrial Revolution
– Southern Concepts Restaurant has witnessed rapid integration of technology during Covid-19 in the Restaurants industry. As one of the leading players in the industry, Southern Concepts Restaurant needs to keep up with the evolution of technology in the Restaurants 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Southern Concepts Restaurant in Restaurants industry. The Restaurants 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.
Stagnating economy with rate increase
– Southern Concepts Restaurant 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 Restaurants industry.
Easy access to finance
– Easy access to finance in Restaurants industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Southern Concepts Restaurant can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Southern Concepts Restaurant 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.
Shortening product life cycle
– it is one of the major threat that Southern Concepts Restaurant is facing in Restaurants sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Southern Concepts Restaurant may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Restaurants sector.
Environmental challenges
– Southern Concepts Restaurant 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. Southern Concepts Restaurant can take advantage of this fund but it will also bring new competitors in the Restaurants industry.
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. Southern Concepts Restaurant needs to understand the core reasons impacting the Restaurants industry. This will help it in building a better workplace.
Increasing wage structure of Southern Concepts Restaurant
– 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 Southern Concepts Restaurant.
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 Southern Concepts Restaurant in the Restaurants sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Southern Concepts Restaurant Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Southern Concepts Restaurant 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 Southern Concepts Restaurant 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 Southern Concepts Restaurant 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 Southern Concepts Restaurant 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 Southern Concepts Restaurant needs to make to build a sustainable competitive advantage.