AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale
AmBev, the merger of the two largest Brazilian beverage companies (Brahma and Antarctica) wants to become a strong South American multinational, able to compete with the main global players in this sector. AmBev creation process raised an important polemic. Competitors said AmBev would have a monopolistic power (controls about 70% of the Brazilian beer market). The Brazilian Government had to intervene and, finally, AmBev was authorized only with some minor restrictions.
Swot Analysis of "AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale" written by Lourdes Casanova, Fernando Rodrigues includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Ambev Brazilian facing as an external strategic factors. Some of the topics covered in AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale case study are - Strategic Management Strategies, Mergers & acquisitions and Strategy & Execution.
Some of the macro environment factors that can be used to understand the AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale casestudy better are - – challanges to central banks by blockchain based private currencies, increasing energy prices, competitive advantages are harder to sustain because of technology dispersion, digital marketing is dominated by two big players Facebook and Google, increasing household debt because of falling income levels, there is increasing trade war between United States & China, central banks are concerned over increasing inflation,
cloud computing is disrupting traditional business models, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Ambev Brazilian, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Ambev Brazilian 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 AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale can be done for the following purposes –
1. Strategic planning using facts provided in AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale case study
2. Improving business portfolio management of Ambev Brazilian
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Ambev Brazilian
Strengths AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Ambev Brazilian in AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale Harvard Business Review case study are -
Superior customer experience
– The customer experience strategy of Ambev Brazilian in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Analytics focus
– Ambev Brazilian 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 industry. The technology infrastructure suggested by Lourdes Casanova, Fernando Rodrigues can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Organizational Resilience of Ambev Brazilian
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Ambev Brazilian does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Highly skilled collaborators
– Ambev Brazilian 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 AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Ambev Brazilian digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Ambev Brazilian 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.
Low bargaining power of suppliers
– Suppliers of Ambev Brazilian in the sector have low bargaining power. AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Ambev Brazilian to manage not only supply disruptions but also source products at highly competitive prices.
Diverse revenue streams
– Ambev Brazilian is present in almost all the verticals within the industry. This has provided firm in AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale 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.
High switching costs
– The high switching costs that Ambev Brazilian 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.
Sustainable margins compare to other players in Strategy & Execution industry
– AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale firm has clearly differentiated products in the market place. This has enabled Ambev Brazilian to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Ambev Brazilian to invest into research and development (R&D) and innovation.
Effective Research and Development (R&D)
– Ambev Brazilian has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to recruit top talent
– Ambev Brazilian is one of the leading recruiters in the industry. Managers in the AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale 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
– Ambev Brazilian is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale are -
Aligning sales with marketing
– It come across in the case study AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale 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 AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale can leverage the sales team experience to cultivate customer relationships as Ambev Brazilian is planning to shift buying processes online.
Skills based hiring
– The stress on hiring functional specialists at Ambev Brazilian 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.
Need for greater diversity
– Ambev Brazilian 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Ambev Brazilian is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale 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, Ambev Brazilian 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.
High cash cycle compare to competitors
Ambev Brazilian 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.
Slow to strategic competitive environment developments
– As AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale HBR case study mentions - Ambev Brazilian takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Increasing silos among functional specialists
– The organizational structure of Ambev Brazilian is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Ambev Brazilian needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Ambev Brazilian to focus more on services rather than just following the product oriented approach.
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 Ambev Brazilian supply chain. Even after few cautionary changes mentioned in the HBR case study - AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Ambev Brazilian vulnerable to further global disruptions in South East Asia.
Low market penetration in new markets
– Outside its home market of Ambev Brazilian, firm in the HBR case study AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale 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 AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale, is just above the industry average. Ambev Brazilian 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.
Opportunities AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale | 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 AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale are -
Creating value in data economy
– The success of analytics program of Ambev Brazilian has opened avenues for new revenue streams for the organization in the industry. This can help Ambev Brazilian to build a more holistic ecosystem as suggested in the AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale case study. Ambev Brazilian can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Manufacturing automation
– Ambev Brazilian can use the latest technology developments to improve its manufacturing and designing process in Strategy & Execution 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.
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 Ambev Brazilian in the consumer business. Now Ambev Brazilian can target international markets with far fewer capital restrictions requirements than the existing system.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Ambev Brazilian 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 Ambev Brazilian to hire the very best people irrespective of their geographical location.
Developing new processes and practices
– Ambev Brazilian can develop new processes and procedures in Strategy & Execution 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Ambev Brazilian can use these opportunities to build new business models that can help the communities that Ambev Brazilian operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Strategy & Execution industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Ambev Brazilian 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. Ambev Brazilian 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.
Leveraging digital technologies
– Ambev Brazilian 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 Strategy & Execution industry, but it has also influenced the consumer preferences. Ambev Brazilian 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 Ambev Brazilian in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Strategy & Execution segment, and it will provide faster access to the consumers.
Loyalty marketing
– Ambev Brazilian 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.
Buying journey improvements
– Ambev Brazilian can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale suggest that firm 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Ambev Brazilian can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale 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 Ambev Brazilian.
Shortening product life cycle
– it is one of the major threat that Ambev Brazilian is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Consumer confidence and its impact on Ambev Brazilian 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.
High dependence on third party suppliers
– Ambev Brazilian 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.
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. Ambev Brazilian needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale, Ambev Brazilian may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Strategy & Execution .
Regulatory challenges
– Ambev Brazilian 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 Strategy & Execution industry regulations.
Technology acceleration in Forth Industrial Revolution
– Ambev Brazilian has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Ambev Brazilian needs to keep up with the evolution of technology in the Strategy & Execution 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Ambev Brazilian with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Ambev Brazilian business can come under increasing regulations regarding data privacy, data security, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Ambev Brazilian in the Strategy & Execution industry. The Strategy & Execution 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.
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 Ambev Brazilian in the Strategy & Execution sector and impact the bottomline of the organization.
Stagnating economy with rate increase
– Ambev Brazilian 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.
Weighted SWOT Analysis of AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale 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 AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale 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 AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale 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 AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale 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 AmBev, The Dream Project (A): A Brazilian-Based Multinational Beverage Company with Global Scale 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 Ambev Brazilian needs to make to build a sustainable competitive advantage.
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