ENOVE: Business Strategy in a Transitioning Economy SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of ENOVE: Business Strategy in a Transitioning Economy
In August 2014, La SociA?tA? Energies Nouvelles & Environnement (ENOVE), a subdivision of Groupe Bismuth, was developing an expansion strategy in the unstable political and economic environment of Tunisia, the company's home country. Tunisia was the birthplace of the Arab Spring, a series of political revolutions that started in 2010 and swept the Mediterranean region for five years. Tunisia was also quickly moving toward a democratically elected government, but the transition was not an easy one; the country experienced a setback of about 10 to 15 years, in regards to economic development. Years of functional corruption under the long-time president, Ben Ali, were followed by sustained economic growth in manufacturing, tourism, and education. This led the economy into a governmental vacuum. For the first time, workers began exercising their rights to demand better conditions. There was little governmental oversight on customs, labour, or taxation. The threat of terrorism, whether real or perceived, was always present. Under these conditions, ENOVE's president had to make a decision: Should ENOVE expand within Tunisia, or move their manufacturing operations to a more stable country, perhaps nearby Morocco? Maciek Nowak is affiliated with Quinlan School of Business-Isom.
Swot Analysis of "ENOVE: Business Strategy in a Transitioning Economy" written by Maciek Nowak, Alexander Stoll includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Tunisia Enove facing as an external strategic factors. Some of the topics covered in ENOVE: Business Strategy in a Transitioning Economy case study are - Strategic Management Strategies, Decision making, Emerging markets, Government, Manufacturing, Strategy and Strategy & Execution.
Some of the macro environment factors that can be used to understand the ENOVE: Business Strategy in a Transitioning Economy casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, customer relationship management is fast transforming because of increasing concerns over data privacy, there is increasing trade war between United States & China, increasing commodity prices, increasing household debt because of falling income levels, geopolitical disruptions, increasing energy prices,
wage bills are increasing, banking and financial system is disrupted by Bitcoin and other crypto currencies, etc
Introduction to SWOT Analysis of ENOVE: Business Strategy in a Transitioning Economy
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in ENOVE: Business Strategy in a Transitioning Economy case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Tunisia Enove, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Tunisia Enove 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 ENOVE: Business Strategy in a Transitioning Economy can be done for the following purposes –
1. Strategic planning using facts provided in ENOVE: Business Strategy in a Transitioning Economy case study
2. Improving business portfolio management of Tunisia Enove
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 Tunisia Enove
Strengths ENOVE: Business Strategy in a Transitioning Economy | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Tunisia Enove in ENOVE: Business Strategy in a Transitioning Economy Harvard Business Review case study are -
High brand equity
– Tunisia Enove has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Tunisia Enove to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Training and development
– Tunisia Enove has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in ENOVE: Business Strategy in a Transitioning Economy 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.
Strong track record of project management
– Tunisia Enove is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Effective Research and Development (R&D)
– Tunisia Enove 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 ENOVE: Business Strategy in a Transitioning Economy - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High switching costs
– The high switching costs that Tunisia Enove 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.
Operational resilience
– The operational resilience strategy in the ENOVE: Business Strategy in a Transitioning Economy 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.
Successful track record of launching new products
– Tunisia Enove has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Tunisia Enove 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.
Ability to recruit top talent
– Tunisia Enove is one of the leading recruiters in the industry. Managers in the ENOVE: Business Strategy in a Transitioning Economy are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Highly skilled collaborators
– Tunisia Enove 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 ENOVE: Business Strategy in a Transitioning Economy HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to lead change in Strategy & Execution field
– Tunisia Enove 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 Tunisia Enove 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 Tunisia Enove digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Tunisia Enove 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.
Superior customer experience
– The customer experience strategy of Tunisia Enove in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses ENOVE: Business Strategy in a Transitioning Economy | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of ENOVE: Business Strategy in a Transitioning Economy are -
Capital Spending Reduction
– Even during the low interest decade, Tunisia Enove 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study ENOVE: Business Strategy in a Transitioning Economy, in the dynamic environment Tunisia Enove has struggled to respond to the nimble upstart competition. Tunisia Enove has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High cash cycle compare to competitors
Tunisia Enove 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 ENOVE: Business Strategy in a Transitioning Economy HBR case study mentions - Tunisia Enove 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.
Low market penetration in new markets
– Outside its home market of Tunisia Enove, firm in the HBR case study ENOVE: Business Strategy in a Transitioning Economy needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow decision making process
– As mentioned earlier in the report, Tunisia Enove 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. Tunisia Enove 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.
Interest costs
– Compare to the competition, Tunisia Enove 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Tunisia Enove 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.
Products dominated business model
– Even though Tunisia Enove 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 - ENOVE: Business Strategy in a Transitioning Economy should strive to include more intangible value offerings along with its core products and services.
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 Tunisia Enove supply chain. Even after few cautionary changes mentioned in the HBR case study - ENOVE: Business Strategy in a Transitioning Economy, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Tunisia Enove vulnerable to further global disruptions in South East Asia.
No frontier risks strategy
– After analyzing the HBR case study ENOVE: Business Strategy in a Transitioning Economy, 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.
Opportunities ENOVE: Business Strategy in a Transitioning Economy | 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 ENOVE: Business Strategy in a Transitioning Economy are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Tunisia Enove 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 Tunisia Enove to hire the very best people irrespective of their geographical location.
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. Tunisia Enove 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. Tunisia Enove 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.
Learning at scale
– Online learning technologies has now opened space for Tunisia Enove 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Tunisia Enove 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Tunisia Enove can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Tunisia Enove can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Tunisia Enove can use these opportunities to build new business models that can help the communities that Tunisia Enove operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
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 Tunisia Enove 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.
Buying journey improvements
– Tunisia Enove can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. ENOVE: Business Strategy in a Transitioning Economy 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.
Loyalty marketing
– Tunisia Enove 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.
Creating value in data economy
– The success of analytics program of Tunisia Enove has opened avenues for new revenue streams for the organization in the industry. This can help Tunisia Enove to build a more holistic ecosystem as suggested in the ENOVE: Business Strategy in a Transitioning Economy case study. Tunisia Enove can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– Tunisia Enove 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 ENOVE: Business Strategy in a Transitioning Economy - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Tunisia Enove to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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 Tunisia Enove in the consumer business. Now Tunisia Enove can target international markets with far fewer capital restrictions requirements than the existing system.
Threats ENOVE: Business Strategy in a Transitioning Economy External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study ENOVE: Business Strategy in a Transitioning Economy are -
Technology acceleration in Forth Industrial Revolution
– Tunisia Enove has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Tunisia Enove 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.
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. Tunisia Enove can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Tunisia Enove in the Strategy & Execution sector and impact the bottomline of the organization.
Environmental challenges
– Tunisia Enove 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. Tunisia Enove can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Stagnating economy with rate increase
– Tunisia Enove 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Tunisia Enove with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
High dependence on third party suppliers
– Tunisia Enove 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. Tunisia Enove 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.
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 Tunisia Enove.
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 Tunisia Enove business can come under increasing regulations regarding data privacy, data security, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Tunisia Enove 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 ENOVE: Business Strategy in a Transitioning Economy .
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. Tunisia Enove needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
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.
Weighted SWOT Analysis of ENOVE: Business Strategy in a Transitioning Economy 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 ENOVE: Business Strategy in a Transitioning Economy 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 ENOVE: Business Strategy in a Transitioning Economy 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 ENOVE: Business Strategy in a Transitioning Economy 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 ENOVE: Business Strategy in a Transitioning Economy 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 Tunisia Enove needs to make to build a sustainable competitive advantage.
