Based on various researches at Oak Spring University , Diversified Restaurant Hld is operating in a macro-environment that has been destablized by – supply chains are disrupted by pandemic , increasing transportation and logistics costs, wage bills are increasing, talent flight as more people leaving formal jobs, increasing inequality as vast percentage of new income is going to the top 1%, there is increasing trade war between United States & China, increasing energy prices,
cloud computing is disrupting traditional business models, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
Introduction to SWOT Analysis of Diversified Restaurant Hld
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Diversified Restaurant Hld can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Diversified Restaurant Hld, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Diversified Restaurant Hld 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 Diversified Restaurant Hld can be done for the following purposes –
1. Strategic planning of Diversified Restaurant Hld
2. Improving business portfolio management of Diversified Restaurant Hld
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 Diversified Restaurant Hld
Strengths of Diversified Restaurant Hld | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Diversified Restaurant Hld are -
Low bargaining power of suppliers
– Suppliers of Diversified Restaurant Hld in the Services sector have low bargaining power. Diversified Restaurant Hld has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Diversified Restaurant Hld to manage not only supply disruptions but also source products at highly competitive prices.
Sustainable margins compare to other players in Restaurants industry
– Diversified Restaurant Hld has clearly differentiated products in the market place. This has enabled Diversified Restaurant Hld to fetch slight price premium compare to the competitors in the Restaurants industry. The sustainable margins have also helped Diversified Restaurant Hld to invest into research and development (R&D) and innovation.
Ability to recruit top talent
– Diversified Restaurant Hld 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.
Digital Transformation in Restaurants industry
- digital transformation varies from industry to industry. For Diversified Restaurant Hld digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Diversified Restaurant Hld 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.
Training and development
– Diversified Restaurant Hld 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
- Diversified Restaurant Hld 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 Diversified Restaurant Hld is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Diversified Restaurant Hld emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Diversified Restaurant Hld is present in almost all the verticals within the Restaurants industry. This has provided Diversified Restaurant Hld 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.
Organizational Resilience of Diversified Restaurant Hld
– The covid-19 pandemic has put organizational resilience at the centre of everthing Diversified Restaurant Hld does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to lead change in Restaurants
– Diversified Restaurant Hld is one of the leading players in the Restaurants industry in United States. Over the years it has not only transformed the business landscape in the Restaurants industry in United States but also across the existing markets. The ability to lead change has enabled Diversified Restaurant Hld 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 Restaurants industry
– Diversified Restaurant Hld is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High brand equity
– Diversified Restaurant Hld has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Diversified Restaurant Hld to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Highly skilled collaborators
– Diversified Restaurant Hld 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 Diversified Restaurant Hld have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses of Diversified Restaurant Hld | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Diversified Restaurant Hld are -
High dependence on Diversified Restaurant Hld ‘s star products
– The top 2 products and services of Diversified Restaurant Hld 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 Diversified Restaurant Hld has relatively successful track record of launching new products.
Low market penetration in new markets
– Outside its home market of United States, Diversified Restaurant Hld needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to strategic competitive environment developments
– As Diversified Restaurant Hld 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.
Employees’ less understanding of Diversified Restaurant Hld strategy
– From the outside it seems that the employees of Diversified Restaurant Hld 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.
Increasing silos among functional specialists
– The organizational structure of Diversified Restaurant Hld is dominated by functional specialists. It is not different from other players in the Restaurants industry, but Diversified Restaurant Hld needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Diversified Restaurant Hld to focus more on services in the Restaurants industry rather than just following the product oriented approach.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Diversified Restaurant Hld is slow explore the new channels of communication. These new channels of communication can help Diversified Restaurant Hld to provide better information regarding Restaurants products and services. It can also build an online community to further reach out to potential customers.
Capital Spending Reduction
– Even during the low interest decade, Diversified Restaurant Hld 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.
Aligning sales with marketing
– From the outside it seems that Diversified Restaurant Hld needs to have more collaboration between its sales team and marketing team. Sales professionals in the Restaurants industry have deep experience in developing customer relationships. Marketing department at Diversified Restaurant Hld can leverage the sales team experience to cultivate customer relationships as Diversified Restaurant Hld is planning to shift buying processes online.
Skills based hiring in Restaurants industry
– The stress on hiring functional specialists at Diversified Restaurant Hld 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.
Interest costs
– Compare to the competition, Diversified Restaurant Hld 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.
Need for greater diversity
– Diversified Restaurant Hld 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.
Diversified Restaurant Hld Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Diversified Restaurant Hld are -
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 Diversified Restaurant Hld 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.
Loyalty marketing
– Diversified Restaurant Hld 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Diversified Restaurant Hld is facing challenges because of the dominance of functional experts in the organization. Diversified Restaurant Hld can utilize new technology in the field of Restaurants industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Low interest rates
– Even though inflation is raising its head in most developed economies, Diversified Restaurant Hld 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.
Using analytics as competitive advantage
– Diversified Restaurant Hld 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 Diversified Restaurant Hld to build a competitive advantage using analytics. The analytics driven competitive advantage can help Diversified Restaurant Hld to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Restaurants industry, but it has also influenced the consumer preferences. Diversified Restaurant Hld can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Diversified Restaurant Hld 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 Diversified Restaurant Hld to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Manufacturing automation
– Diversified Restaurant Hld can use the latest technology developments to improve its manufacturing and designing process in Restaurants 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.
Creating value in data economy
– The success of analytics program of Diversified Restaurant Hld has opened avenues for new revenue streams for the organization in Restaurants industry. This can help Diversified Restaurant Hld to build a more holistic ecosystem for Diversified Restaurant Hld products in the Restaurants industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Diversified Restaurant Hld 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 Diversified Restaurant Hld to hire the very best people irrespective of their geographical location.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Diversified Restaurant Hld can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Use of Bitcoin and other crypto currencies for transactions in Restaurants industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Diversified Restaurant Hld in the Restaurants industry. Now Diversified Restaurant Hld can target international markets with far fewer capital restrictions requirements than the existing system.
Developing new processes and practices
– Diversified Restaurant Hld 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 Diversified Restaurant Hld External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Diversified Restaurant Hld are -
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.
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 Restaurants industry are lowering. It can presents Diversified Restaurant Hld with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Restaurants sector.
Shortening product life cycle
– it is one of the major threat that Diversified Restaurant Hld is facing in Restaurants sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Regulatory challenges
– Diversified Restaurant Hld 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.
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. Diversified Restaurant Hld 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.
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 Diversified Restaurant Hld.
High dependence on third party suppliers
– Diversified Restaurant Hld 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.
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 Diversified Restaurant Hld in the Restaurants sector and impact the bottomline of the organization.
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. Diversified Restaurant Hld can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing wage structure of Diversified Restaurant Hld
– 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 Diversified Restaurant Hld.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Diversified Restaurant Hld 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Diversified Restaurant Hld 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.
Weighted SWOT Analysis of Diversified Restaurant Hld Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Diversified Restaurant Hld 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 Diversified Restaurant Hld 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 Diversified Restaurant Hld 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 Diversified Restaurant Hld 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 Diversified Restaurant Hld needs to make to build a sustainable competitive advantage.