YPF S.A.: Shaping a New Culture SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Organizational Development
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of YPF S.A.: Shaping a New Culture
This case examines the organizational changes and human resource strategies implemented to create an entrepreneurial culture within the formerly state-owned oil company. After a local entrepreneur radically downsized and reorganized the company, YPF was successfully taken public in 1993. But in a country where the economy had been closed for many decades and state-owned institutions had become bloated and highly bureaucratic, changing the mindset and behavior of the workforce to turn it into a competitive player in the world economy was not automatic. It required major redesign of organizational systems, like recruiting, training, and performance management. The case describes the changes introduced by a new vice president of human resources and offers early reaction to those changes.
Swot Analysis of "YPF S.A.: Shaping a New Culture" written by Anne Donnellon includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Ypf Downsized facing as an external strategic factors. Some of the topics covered in YPF S.A.: Shaping a New Culture case study are - Strategic Management Strategies, Organizational culture, Organizational structure and Organizational Development.
Some of the macro environment factors that can be used to understand the YPF S.A.: Shaping a New Culture casestudy better are - – increasing commodity prices, increasing inequality as vast percentage of new income is going to the top 1%, increasing household debt because of falling income levels, challanges to central banks by blockchain based private currencies, increasing government debt because of Covid-19 spendings, increasing transportation and logistics costs, technology disruption,
banking and financial system is disrupted by Bitcoin and other crypto currencies, there is backlash against globalization, etc
Introduction to SWOT Analysis of YPF S.A.: Shaping a New Culture
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in YPF S.A.: Shaping a New Culture case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Ypf Downsized, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Ypf Downsized 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 YPF S.A.: Shaping a New Culture can be done for the following purposes –
1. Strategic planning using facts provided in YPF S.A.: Shaping a New Culture case study
2. Improving business portfolio management of Ypf Downsized
3. Assessing feasibility of the new initiative in Organizational Development field.
4. Making a Organizational Development topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Ypf Downsized
Strengths YPF S.A.: Shaping a New Culture | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Ypf Downsized in YPF S.A.: Shaping a New Culture Harvard Business Review case study are -
Ability to recruit top talent
– Ypf Downsized is one of the leading recruiters in the industry. Managers in the YPF S.A.: Shaping a New Culture are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Strong track record of project management
– Ypf Downsized is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Diverse revenue streams
– Ypf Downsized is present in almost all the verticals within the industry. This has provided firm in YPF S.A.: Shaping a New Culture case study 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.
Highly skilled collaborators
– Ypf Downsized has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in YPF S.A.: Shaping a New Culture HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Training and development
– Ypf Downsized has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in YPF S.A.: Shaping a New Culture Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
High brand equity
– Ypf Downsized has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Ypf Downsized to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Learning organization
- Ypf Downsized 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 Ypf Downsized is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in YPF S.A.: Shaping a New Culture Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Organizational Resilience of Ypf Downsized
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Ypf Downsized does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Digital Transformation in Organizational Development segment
- digital transformation varies from industry to industry. For Ypf Downsized digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Ypf Downsized 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.
High switching costs
– The high switching costs that Ypf Downsized 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.
Superior customer experience
– The customer experience strategy of Ypf Downsized in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to lead change in Organizational Development field
– Ypf Downsized is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Ypf Downsized in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Weaknesses YPF S.A.: Shaping a New Culture | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of YPF S.A.: Shaping a New Culture 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 Ypf Downsized supply chain. Even after few cautionary changes mentioned in the HBR case study - YPF S.A.: Shaping a New Culture, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Ypf Downsized vulnerable to further global disruptions in South East Asia.
High cash cycle compare to competitors
Ypf Downsized has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study YPF S.A.: Shaping a New Culture, in the dynamic environment Ypf Downsized has struggled to respond to the nimble upstart competition. Ypf Downsized has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Products dominated business model
– Even though Ypf Downsized has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - YPF S.A.: Shaping a New Culture should strive to include more intangible value offerings along with its core products and services.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study YPF S.A.: Shaping a New Culture, it seems that the employees of Ypf Downsized 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.
Lack of clear differentiation of Ypf Downsized products
– To increase the profitability and margins on the products, Ypf Downsized needs to provide more differentiated products than what it is currently offering in the marketplace.
High operating costs
– Compare to the competitors, firm in the HBR case study YPF S.A.: Shaping a New Culture has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Ypf Downsized 's lucrative customers.
Low market penetration in new markets
– Outside its home market of Ypf Downsized, firm in the HBR case study YPF S.A.: Shaping a New Culture needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study YPF S.A.: Shaping a New Culture, is just above the industry average. Ypf Downsized 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.
Aligning sales with marketing
– It come across in the case study YPF S.A.: Shaping a New Culture that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case YPF S.A.: Shaping a New Culture can leverage the sales team experience to cultivate customer relationships as Ypf Downsized is planning to shift buying processes online.
Capital Spending Reduction
– Even during the low interest decade, Ypf Downsized 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 industry using digital technology.
Opportunities YPF S.A.: Shaping a New Culture | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study YPF S.A.: Shaping a New Culture are -
Leveraging digital technologies
– Ypf Downsized 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.
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 Ypf Downsized 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.
Manufacturing automation
– Ypf Downsized can use the latest technology developments to improve its manufacturing and designing process in Organizational Development segment. 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Ypf Downsized can use these opportunities to build new business models that can help the communities that Ypf Downsized operates in. Secondly it can use opportunities from government spending in Organizational Development sector.
Creating value in data economy
– The success of analytics program of Ypf Downsized has opened avenues for new revenue streams for the organization in the industry. This can help Ypf Downsized to build a more holistic ecosystem as suggested in the YPF S.A.: Shaping a New Culture case study. Ypf Downsized can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– Ypf Downsized has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study YPF S.A.: Shaping a New Culture - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Ypf Downsized to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Ypf Downsized 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 Ypf Downsized to hire the very best people irrespective of their geographical location.
Loyalty marketing
– Ypf Downsized 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 Ypf Downsized 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.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Ypf Downsized in the consumer business. Now Ypf Downsized can target international markets with far fewer capital restrictions requirements than the existing system.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Ypf Downsized 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, as suggested in case study, YPF S.A.: Shaping a New Culture, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Organizational Development industry, but it has also influenced the consumer preferences. Ypf Downsized can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Ypf Downsized in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Organizational Development segment, and it will provide faster access to the consumers.
Threats YPF S.A.: Shaping a New Culture External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study YPF S.A.: Shaping a New Culture are -
Technology acceleration in Forth Industrial Revolution
– Ypf Downsized has witnessed rapid integration of technology during Covid-19 in the Organizational Development industry. As one of the leading players in the industry, Ypf Downsized needs to keep up with the evolution of technology in the Organizational Development 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.
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 Ypf Downsized business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Ypf Downsized 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 field.
High dependence on third party suppliers
– Ypf Downsized 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.
Environmental challenges
– Ypf Downsized 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. Ypf Downsized can take advantage of this fund but it will also bring new competitors in the Organizational Development industry.
Consumer confidence and its impact on Ypf Downsized 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 the industry and other sectors.
Easy access to finance
– Easy access to finance in Organizational Development field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Ypf Downsized can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Ypf Downsized in the Organizational Development sector and impact the bottomline of the organization.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Increasing wage structure of Ypf Downsized
– 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 Ypf Downsized.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Ypf Downsized in the Organizational Development industry. The Organizational Development 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Ypf Downsized 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 prominent markets illustrated in HBR case study YPF S.A.: Shaping a New Culture .
Shortening product life cycle
– it is one of the major threat that Ypf Downsized is facing in Organizational Development sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of YPF S.A.: Shaping a New Culture Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study YPF S.A.: Shaping a New Culture 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 the case study YPF S.A.: Shaping a New Culture 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 the Harvard case study YPF S.A.: Shaping a New Culture 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 YPF S.A.: Shaping a New Culture is 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 Ypf Downsized needs to make to build a sustainable competitive advantage.