Les Hotels Bav (ALLHB) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Les Hotels Bav (France)

Based on various researches at Oak Spring University , Les Hotels Bav is operating in a macro-environment that has been destablized by – increasing transportation and logistics costs, increasing energy prices, talent flight as more people leaving formal jobs, technology disruption, increasing government debt because of Covid-19 spendings, digital marketing is dominated by two big players Facebook and Google, there is backlash against globalization, supply chains are disrupted by pandemic , challanges to central banks by blockchain based private currencies, etc

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Introduction to SWOT Analysis of Les Hotels Bav

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Les Hotels Bav can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Les Hotels Bav, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Les Hotels Bav 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of Les Hotels Bav can be done for the following purposes –
1. Strategic planning of Les Hotels Bav
2. Improving business portfolio management of Les Hotels Bav
3. Assessing feasibility of the new initiative in France
4. Making a Hotels & Motels sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Les Hotels Bav

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Strengths of Les Hotels Bav | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Les Hotels Bav are -

Ability to recruit top talent

– Les Hotels Bav is one of the leading players in the Hotels & Motels industry in France. It is in a position to attract the best talent available in France. The firm has a robust talent identification program that helps in identifying the brightest.

Successful track record of launching new products

– Les Hotels Bav has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Les Hotels Bav 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.

Analytics focus

– Les Hotels Bav 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 France 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.

High brand equity

– Les Hotels Bav has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Les Hotels Bav to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Organizational Resilience of Les Hotels Bav

– The covid-19 pandemic has put organizational resilience at the centre of everthing Les Hotels Bav does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.

Low bargaining power of suppliers

– Suppliers of Les Hotels Bav in the Services sector have low bargaining power. Les Hotels Bav has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Les Hotels Bav to manage not only supply disruptions but also source products at highly competitive prices.

Highly skilled collaborators

– Les Hotels Bav has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Hotels & Motels industry. Secondly the value chain collaborators of Les Hotels Bav have helped the firm to develop new products and bring them quickly to the marketplace.

Operational resilience

– The operational resilience strategy of Les Hotels Bav comprises – understanding the underlying the factors in the Hotels & Motels 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.

Cross disciplinary teams

– Horizontal connected teams at the Les Hotels Bav 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.

Sustainable margins compare to other players in Hotels & Motels industry

– Les Hotels Bav has clearly differentiated products in the market place. This has enabled Les Hotels Bav to fetch slight price premium compare to the competitors in the Hotels & Motels industry. The sustainable margins have also helped Les Hotels Bav to invest into research and development (R&D) and innovation.

Superior customer experience

– The customer experience strategy of Les Hotels Bav in Hotels & Motels industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Ability to lead change in Hotels & Motels

– Les Hotels Bav is one of the leading players in the Hotels & Motels industry in France. Over the years it has not only transformed the business landscape in the Hotels & Motels industry in France but also across the existing markets. The ability to lead change has enabled Les Hotels Bav in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

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Weaknesses of Les Hotels Bav | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Les Hotels Bav are -

Aligning sales with marketing

– From the outside it seems that Les Hotels Bav 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 Les Hotels Bav can leverage the sales team experience to cultivate customer relationships as Les Hotels Bav is planning to shift buying processes online.

Employees’ less understanding of Les Hotels Bav strategy

– From the outside it seems that the employees of Les Hotels Bav 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 Les Hotels Bav ‘s star products

– The top 2 products and services of Les Hotels Bav 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 Les Hotels Bav has relatively successful track record of launching new products.

Low market penetration in new markets

– Outside its home market of France, Les Hotels Bav needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.

High bargaining power of channel partners in Hotels & Motels industry

– because of the regulatory requirements in France, Les Hotels Bav 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.

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 Les Hotels Bav supply chain. Even after few cautionary changes, Les Hotels Bav is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Les Hotels Bav vulnerable to further global disruptions in South East Asia.

Compensation and incentives

– The revenue per employee of Les Hotels Bav 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.

Need for greater diversity

– Les Hotels Bav 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.

Lack of clear differentiation of Les Hotels Bav products

– To increase the profitability and margins on the products, Les Hotels Bav needs to provide more differentiated products than what it is currently offering in the marketplace.

Increasing silos among functional specialists

– The organizational structure of Les Hotels Bav is dominated by functional specialists. It is not different from other players in the Hotels & Motels industry, but Les Hotels Bav needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Les Hotels Bav to focus more on services in the Hotels & Motels industry rather than just following the product oriented approach.

Interest costs

– Compare to the competition, Les Hotels Bav 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.

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Les Hotels Bav Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of Les Hotels Bav are -

Low interest rates

– Even though inflation is raising its head in most developed economies, Les Hotels Bav 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.

Leveraging digital technologies

– Les Hotels Bav 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.

Building a culture of innovation

– managers at Les Hotels Bav 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 Hotels & Motels industry.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Les Hotels Bav can use these opportunities to build new business models that can help the communities that Les Hotels Bav operates in. Secondly it can use opportunities from government spending in Hotels & Motels sector.

Buying journey improvements

– Les Hotels Bav can improve the customer journey of consumers in the Hotels & Motels 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.

Finding new ways to collaborate

– Covid-19 has not only transformed business models of companies in Hotels & Motels industry, but it has also influenced the consumer preferences. Les Hotels Bav can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

Creating value in data economy

– The success of analytics program of Les Hotels Bav has opened avenues for new revenue streams for the organization in Hotels & Motels industry. This can help Les Hotels Bav to build a more holistic ecosystem for Les Hotels Bav products in the Hotels & Motels industry by providing – data insight services, data privacy related products, data based consulting services, etc.

Use of Bitcoin and other crypto currencies for transactions in Hotels & Motels industry

– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Les Hotels Bav in the Hotels & Motels industry. Now Les Hotels Bav can target international markets with far fewer capital restrictions requirements than the existing system.

Using analytics as competitive advantage

– Les Hotels Bav 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 Les Hotels Bav to build a competitive advantage using analytics. The analytics driven competitive advantage can help Les Hotels Bav to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects Les Hotels Bav can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

Loyalty marketing

– Les Hotels Bav 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.

Learning at scale

– Online learning technologies has now opened space for Les Hotels Bav 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.

Lowering marketing communication costs

– 5G expansion will open new opportunities for Les Hotels Bav 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.

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Threats Les Hotels Bav External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of Les Hotels Bav are -

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 Les Hotels Bav.

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. Les Hotels Bav 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. Les Hotels Bav 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

– Les Hotels Bav 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.

Increasing wage structure of Les Hotels Bav

– 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 Les Hotels Bav.

Regulatory challenges

– Les Hotels Bav 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.

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. Les Hotels Bav needs to understand the core reasons impacting the Hotels & Motels industry. This will help it in building a better workplace.

Shortening product life cycle

– it is one of the major threat that Les Hotels Bav is facing in Hotels & Motels sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

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 Les Hotels Bav in the Hotels & Motels sector and impact the bottomline of the organization.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry to Hotels & Motels industry are lowering. It can presents Les Hotels Bav with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Hotels & Motels sector.

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.

Environmental challenges

– Les Hotels Bav 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. Les Hotels Bav can take advantage of this fund but it will also bring new competitors in the Hotels & Motels industry.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Les Hotels Bav 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.

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Weighted SWOT Analysis of Les Hotels Bav Template, Example

Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Les Hotels Bav 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 Les Hotels Bav 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 Les Hotels Bav 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 Les Hotels Bav 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 Les Hotels Bav needs to make to build a sustainable competitive advantage.

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