Gas Natural BAN's Strategy for Low-Income Sectors SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Gas Natural BAN's Strategy for Low-Income Sectors
This case focuses on Gas Natural BAN's network expansion project to provide natural gas to five low-income neighborhoods in the suburban area of Buenos Aires. It shows how a business model evolved to serve low-income sector (henceforth, LIS) customers, and, more particularly, it describes how the company partnered with a local CSO, FundaciA?n Pro Vivienda Social (Foundation for Social Housing, henceforth FPVS), and learned how to work with these communities in a project carried out in Moreno's Cuartel V. Starting with the project carried out with FPVS, the company had begun to pursue natural gas network expansion projects for LIS neighborhoods with a business approach that differed from the scheme used with conventional customers. At the juncture depicted by this case, the company needs to set the guidelines for its natural gas network expansion strategy targeting LIS neighborhoods. Gas Natural BAN's experience with FPVS, though viewed as successful by the company, registered some inefficiencies that prevented its large-scale application and led management to look for new options to pursue its LIS strategy. As a result, the FPVS collaboration model and its potential for optimization were questioned. It was also questionable whether the scheme used by FPVS in Moreno's Cuartel V would be applicable to other neighborhoods with different conditions. This teaching case deals primarily with the development of inclusive business models based on cross-sector collaborations involving companies, nonprofits and citizens. It may be used in graduate courses on Business and Society, Corporate Social Responsibility or Business Strategy including BOP issues.
Swot Analysis of "Gas Natural BAN's Strategy for Low-Income Sectors" written by Gabriel Berger, Adrian Darmohraj includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Fpvs Lis facing as an external strategic factors. Some of the topics covered in Gas Natural BAN's Strategy for Low-Income Sectors case study are - Strategic Management Strategies, and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Gas Natural BAN's Strategy for Low-Income Sectors casestudy better are - – challanges to central banks by blockchain based private currencies, supply chains are disrupted by pandemic , there is backlash against globalization, increasing energy prices, increasing household debt because of falling income levels, increasing commodity prices, increasing transportation and logistics costs,
there is increasing trade war between United States & China, talent flight as more people leaving formal jobs, etc
Introduction to SWOT Analysis of Gas Natural BAN's Strategy for Low-Income Sectors
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Gas Natural BAN's Strategy for Low-Income Sectors case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Fpvs Lis, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Fpvs Lis 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 Gas Natural BAN's Strategy for Low-Income Sectors can be done for the following purposes –
1. Strategic planning using facts provided in Gas Natural BAN's Strategy for Low-Income Sectors case study
2. Improving business portfolio management of Fpvs Lis
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 Fpvs Lis
Strengths Gas Natural BAN's Strategy for Low-Income Sectors | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Fpvs Lis in Gas Natural BAN's Strategy for Low-Income Sectors Harvard Business Review case study are -
Learning organization
- Fpvs Lis 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 Fpvs Lis is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Gas Natural BAN's Strategy for Low-Income Sectors Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– Fpvs Lis is one of the most innovative firm in sector. Manager in Gas Natural BAN's Strategy for Low-Income Sectors Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Diverse revenue streams
– Fpvs Lis is present in almost all the verticals within the industry. This has provided firm in Gas Natural BAN's Strategy for Low-Income Sectors 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.
Analytics focus
– Fpvs Lis 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 Gabriel Berger, Adrian Darmohraj 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.
Operational resilience
– The operational resilience strategy in the Gas Natural BAN's Strategy for Low-Income Sectors 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.
Training and development
– Fpvs Lis has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Gas Natural BAN's Strategy for Low-Income Sectors 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.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Fpvs Lis digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Fpvs Lis 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.
Strong track record of project management
– Fpvs Lis is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Superior customer experience
– The customer experience strategy of Fpvs Lis in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Successful track record of launching new products
– Fpvs Lis has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Fpvs Lis has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
High switching costs
– The high switching costs that Fpvs Lis 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.
Organizational Resilience of Fpvs Lis
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Fpvs Lis does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses Gas Natural BAN's Strategy for Low-Income Sectors | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Gas Natural BAN's Strategy for Low-Income Sectors are -
Products dominated business model
– Even though Fpvs Lis 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 - Gas Natural BAN's Strategy for Low-Income Sectors should strive to include more intangible value offerings along with its core products and services.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Fpvs Lis is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Gas Natural BAN's Strategy for Low-Income Sectors can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
High cash cycle compare to competitors
Fpvs Lis 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.
No frontier risks strategy
– After analyzing the HBR case study Gas Natural BAN's Strategy for Low-Income Sectors, 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Gas Natural BAN's Strategy for Low-Income Sectors, in the dynamic environment Fpvs Lis has struggled to respond to the nimble upstart competition. Fpvs Lis has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Workers concerns about automation
– As automation is fast increasing in the segment, Fpvs Lis 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Gas Natural BAN's Strategy for Low-Income Sectors, is just above the industry average. Fpvs Lis 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 Gas Natural BAN's Strategy for Low-Income Sectors 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 Gas Natural BAN's Strategy for Low-Income Sectors can leverage the sales team experience to cultivate customer relationships as Fpvs Lis is planning to shift buying processes online.
Capital Spending Reduction
– Even during the low interest decade, Fpvs Lis 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.
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 Fpvs Lis supply chain. Even after few cautionary changes mentioned in the HBR case study - Gas Natural BAN's Strategy for Low-Income Sectors, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Fpvs Lis vulnerable to further global disruptions in South East Asia.
Increasing silos among functional specialists
– The organizational structure of Fpvs Lis is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Fpvs Lis needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Fpvs Lis to focus more on services rather than just following the product oriented approach.
Opportunities Gas Natural BAN's Strategy for Low-Income Sectors | 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 Gas Natural BAN's Strategy for Low-Income Sectors are -
Leveraging digital technologies
– Fpvs Lis 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.
Buying journey improvements
– Fpvs Lis can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Gas Natural BAN's Strategy for Low-Income Sectors 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.
Creating value in data economy
– The success of analytics program of Fpvs Lis has opened avenues for new revenue streams for the organization in the industry. This can help Fpvs Lis to build a more holistic ecosystem as suggested in the Gas Natural BAN's Strategy for Low-Income Sectors case study. Fpvs Lis can build new products and services such as - data insight services, data privacy related products, data based consulting services, 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, Fpvs Lis can use these opportunities to build new business models that can help the communities that Fpvs Lis operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Learning at scale
– Online learning technologies has now opened space for Fpvs Lis 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.
Loyalty marketing
– Fpvs Lis 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.
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 Fpvs Lis 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Fpvs Lis 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Fpvs Lis 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.
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. Fpvs Lis 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. Fpvs Lis 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.
Using analytics as competitive advantage
– Fpvs Lis 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 Gas Natural BAN's Strategy for Low-Income Sectors - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Fpvs Lis 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 Fpvs Lis to increase its market reach. Fpvs Lis 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.
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. Fpvs Lis can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats Gas Natural BAN's Strategy for Low-Income Sectors External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Gas Natural BAN's Strategy for Low-Income Sectors are -
Easy access to finance
– Easy access to finance in Strategy & Execution field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Fpvs Lis can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Environmental challenges
– Fpvs Lis 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. Fpvs Lis can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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.
Shortening product life cycle
– it is one of the major threat that Fpvs Lis is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Fpvs Lis 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 Gas Natural BAN's Strategy for Low-Income Sectors .
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 Fpvs Lis.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Gas Natural BAN's Strategy for Low-Income Sectors, Fpvs Lis 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 .
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 Fpvs Lis in the Strategy & Execution sector and impact the bottomline of the organization.
Increasing wage structure of Fpvs Lis
– 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 Fpvs Lis.
Regulatory challenges
– Fpvs Lis 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Fpvs Lis 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.
Technology acceleration in Forth Industrial Revolution
– Fpvs Lis has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Fpvs Lis 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 Gas Natural BAN's Strategy for Low-Income Sectors 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 Gas Natural BAN's Strategy for Low-Income Sectors 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 Gas Natural BAN's Strategy for Low-Income Sectors 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 Gas Natural BAN's Strategy for Low-Income Sectors 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 Gas Natural BAN's Strategy for Low-Income Sectors 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 Fpvs Lis needs to make to build a sustainable competitive advantage.
