Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso
McKinsey is an international consulting company that operates in 43 countries. Fundacion Compromiso is an nonprofit entity that provides training, counseling, and technical assistance to improve the management and impact of other nonprofit entities of Argentina. A third organization, Ashoka Association, supports social entrepreneurs and has a global alliance with McKinsey. Ashoka's intermediation is responsible for a cooperation program through which McKinsey applies its central skills to provide technical assistance to Fundacion Compromiso. The objectives of this activity are to evaluate one of Fundacion Compromiso's most important programs and establish a long-term growth strategy for this nonprofit entity. However, following the technical assistance work developed by McKinsey is a dramatic change in Argentina's social, political, and economic situations, which limit the agreed-on strategic plan, forcing Fundacion Compromiso to reconsider its growth strategy.
Authors :: Fernando Frydman, Guillermo Arnaudo, Cecilia Rena, Gabriel Berger
Topics :: Strategy & Execution
Tags :: International business, Joint ventures, Leadership, Public relations, SWOT Analysis, SWOT Matrix, TOWS, Weighted SWOT Analysis
Swot Analysis of "Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso" written by Fernando Frydman, Guillermo Arnaudo, Cecilia Rena, Gabriel Berger includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Fundacion Compromiso facing as an external strategic factors. Some of the topics covered in Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso case study are - Strategic Management Strategies, International business, Joint ventures, Leadership, Public relations and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso casestudy better are - – cloud computing is disrupting traditional business models, technology disruption, talent flight as more people leaving formal jobs, there is increasing trade war between United States & China, customer relationship management is fast transforming because of increasing concerns over data privacy, central banks are concerned over increasing inflation, increasing energy prices,
increasing transportation and logistics costs, there is backlash against globalization, etc
Introduction to SWOT Analysis of Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Fundacion Compromiso, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Fundacion Compromiso 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 Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso can be done for the following purposes –
1. Strategic planning using facts provided in Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso case study
2. Improving business portfolio management of Fundacion Compromiso
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 Fundacion Compromiso
Strengths Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Fundacion Compromiso in Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso Harvard Business Review case study are -
Diverse revenue streams
– Fundacion Compromiso is present in almost all the verticals within the industry. This has provided firm in Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso 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.
Ability to lead change in Strategy & Execution field
– Fundacion Compromiso 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 Fundacion Compromiso in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Fundacion Compromiso digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Fundacion Compromiso 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.
Sustainable margins compare to other players in Strategy & Execution industry
– Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso firm has clearly differentiated products in the market place. This has enabled Fundacion Compromiso to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Fundacion Compromiso to invest into research and development (R&D) and innovation.
Learning organization
- Fundacion Compromiso 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 Fundacion Compromiso is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Organizational Resilience of Fundacion Compromiso
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Fundacion Compromiso does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High switching costs
– The high switching costs that Fundacion Compromiso 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.
Strong track record of project management
– Fundacion Compromiso is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Operational resilience
– The operational resilience strategy in the Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso 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.
High brand equity
– Fundacion Compromiso has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Fundacion Compromiso to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to recruit top talent
– Fundacion Compromiso is one of the leading recruiters in the industry. Managers in the Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Effective Research and Development (R&D)
– Fundacion Compromiso 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 Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso are -
Products dominated business model
– Even though Fundacion Compromiso 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 - Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso should strive to include more intangible value offerings along with its core products and services.
Slow to strategic competitive environment developments
– As Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso HBR case study mentions - Fundacion Compromiso 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso, in the dynamic environment Fundacion Compromiso has struggled to respond to the nimble upstart competition. Fundacion Compromiso has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Skills based hiring
– The stress on hiring functional specialists at Fundacion Compromiso 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.
No frontier risks strategy
– After analyzing the HBR case study Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso, it seems that company is thinking about the frontier risks that can impact Strategy & Execution strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
High bargaining power of channel partners
– Because of the regulatory requirements, Fernando Frydman, Guillermo Arnaudo, Cecilia Rena, Gabriel Berger suggests that, Fundacion Compromiso 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 industry.
Increasing silos among functional specialists
– The organizational structure of Fundacion Compromiso is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Fundacion Compromiso needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Fundacion Compromiso to focus more on services rather than just following the product oriented approach.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso, is just above the industry average. Fundacion Compromiso 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.
Slow decision making process
– As mentioned earlier in the report, Fundacion Compromiso has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Fundacion Compromiso even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso, it seems that the employees of Fundacion Compromiso 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 operating costs
– Compare to the competitors, firm in the HBR case study Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso 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 Fundacion Compromiso 's lucrative customers.
Opportunities Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso | 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 Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso are -
Using analytics as competitive advantage
– Fundacion Compromiso 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 Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Fundacion Compromiso to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Fundacion Compromiso 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. Fundacion Compromiso 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.
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. Fundacion Compromiso can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Fundacion Compromiso can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Fundacion Compromiso 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 Fundacion Compromiso to hire the very best people irrespective of their geographical location.
Learning at scale
– Online learning technologies has now opened space for Fundacion Compromiso 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Fundacion Compromiso can use these opportunities to build new business models that can help the communities that Fundacion Compromiso operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Low interest rates
– Even though inflation is raising its head in most developed economies, Fundacion Compromiso 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.
Building a culture of innovation
– managers at Fundacion Compromiso 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 Strategy & Execution segment.
Leveraging digital technologies
– Fundacion Compromiso 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Fundacion Compromiso is facing challenges because of the dominance of functional experts in the organization. Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso 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.
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 Fundacion Compromiso in the consumer business. Now Fundacion Compromiso can target international markets with far fewer capital restrictions requirements than the existing system.
Creating value in data economy
– The success of analytics program of Fundacion Compromiso has opened avenues for new revenue streams for the organization in the industry. This can help Fundacion Compromiso to build a more holistic ecosystem as suggested in the Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso case study. Fundacion Compromiso can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso are -
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Shortening product life cycle
– it is one of the major threat that Fundacion Compromiso is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Environmental challenges
– Fundacion Compromiso 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. Fundacion Compromiso can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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 Fundacion Compromiso business can come under increasing regulations regarding data privacy, data security, etc.
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. Fundacion Compromiso 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 Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso, Fundacion Compromiso 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 .
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.
High dependence on third party suppliers
– Fundacion Compromiso 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.
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. Fundacion Compromiso 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
– Fundacion Compromiso 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.
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 Fundacion Compromiso in the Strategy & Execution sector and impact the bottomline of the organization.
Consumer confidence and its impact on Fundacion Compromiso 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.
Technology acceleration in Forth Industrial Revolution
– Fundacion Compromiso has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Fundacion Compromiso 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.
Weighted SWOT Analysis of Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso 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 Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso 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 Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso 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 Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso 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 Alliances That Build Alliances: McKinsey-Ashoka and the Fundacion Compromiso 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 Fundacion Compromiso needs to make to build a sustainable competitive advantage.
