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 - – there is increasing trade war between United States & China, geopolitical disruptions, increasing energy prices, competitive advantages are harder to sustain because of technology dispersion, cloud computing is disrupting traditional business models, technology disruption, talent flight as more people leaving formal jobs,
increasing household debt because of falling income levels, digital marketing is dominated by two big players Facebook and Google, 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.
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.
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.
Sustainable margins compare to other players in Organizational Development industry
– YPF S.A.: Shaping a New Culture firm has clearly differentiated products in the market place. This has enabled Ypf Downsized to fetch slight price premium compare to the competitors in the Organizational Development industry. The sustainable margins have also helped Ypf Downsized to invest into research and development (R&D) and innovation.
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.
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.
Operational resilience
– The operational resilience strategy in the YPF S.A.: Shaping a New Culture Harvard Business Review case study comprises – understanding the underlying the factors in the 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.
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.
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.
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.
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.
Cross disciplinary teams
– Horizontal connected teams at the Ypf Downsized are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Weaknesses 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 star products
– The top 2 products and services of the firm as mentioned in the YPF S.A.: Shaping a New Culture HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Ypf Downsized has relatively successful track record of launching new products.
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.
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.
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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Ypf Downsized is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study YPF S.A.: Shaping a New Culture can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Ypf Downsized needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Interest costs
– Compare to the competition, Ypf Downsized 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.
Increasing silos among functional specialists
– The organizational structure of Ypf Downsized is dominated by functional specialists. It is not different from other players in the Organizational Development segment. Ypf Downsized needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Ypf Downsized to focus more on services rather than just following the product oriented approach.
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.
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.
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.
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 -
Low interest rates
– Even though inflation is raising its head in most developed economies, Ypf Downsized 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.
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. Ypf Downsized can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Organizational Development industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Ypf Downsized 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. Ypf Downsized 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.
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.
Building a culture of innovation
– managers at Ypf Downsized 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 Organizational Development segment.
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.
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.
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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Ypf Downsized can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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.
Better consumer reach
– The expansion of the 5G network will help Ypf Downsized to increase its market reach. Ypf Downsized 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.
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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Ypf Downsized is facing challenges because of the dominance of functional experts in the organization. YPF S.A.: Shaping a New Culture case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
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 -
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.
Regulatory challenges
– Ypf Downsized 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 Organizational Development industry regulations.
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 Ypf Downsized.
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.
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.
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.
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. Ypf Downsized 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.
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 .
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.
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.
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.
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.
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.
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.
