IMPSA: Restructuring to Innovate with Existing Resources SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of IMPSA: Restructuring to Innovate with Existing Resources
In late 2012, an executive vice-president faced a dilemma at Industrias Metalurgicas Pescarmona S.A. (IMPSA), an Argentine multinational company that designed and produced cranes, dams, and components for power plants, and had recently begun building hydroelectric and wind power projects. The company's chief executive officer had tasked the executive vice-president with recommending how IMPSA could be radically restructured to adapt to changes in the world marketplace for renewable energy. However, IMPSA was at the top of its game, and the company had a backlog of orders valued at US$3.3 billion. The executive vice-president knew that the chief executive officer would not accept a minor reorganization but would demand a major restructuring based on the firm's existing resources, which was a strategy that, in the past, had proven to be successful for the company, particularly in emerging markets. The executive vice-president wondered how IMPSA could build on its existing wind power and hydroelectric dam business without abandoning the resources the firm had developed over the years. Daniel Friel is affiliated with Universidad de San Andres.
Swot Analysis of "IMPSA: Restructuring to Innovate with Existing Resources" written by Daniel Friel includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Impsa Executive facing as an external strategic factors. Some of the topics covered in IMPSA: Restructuring to Innovate with Existing Resources case study are - Strategic Management Strategies, Mergers & acquisitions, Reorganization and Global Business.
Some of the macro environment factors that can be used to understand the IMPSA: Restructuring to Innovate with Existing Resources casestudy better are - – central banks are concerned over increasing inflation, geopolitical disruptions, wage bills are increasing, digital marketing is dominated by two big players Facebook and Google, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing household debt because of falling income levels, cloud computing is disrupting traditional business models,
supply chains are disrupted by pandemic , technology disruption, etc
Introduction to SWOT Analysis of IMPSA: Restructuring to Innovate with Existing Resources
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in IMPSA: Restructuring to Innovate with Existing Resources case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Impsa Executive, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Impsa Executive 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 IMPSA: Restructuring to Innovate with Existing Resources can be done for the following purposes –
1. Strategic planning using facts provided in IMPSA: Restructuring to Innovate with Existing Resources case study
2. Improving business portfolio management of Impsa Executive
3. Assessing feasibility of the new initiative in Global Business field.
4. Making a Global Business topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Impsa Executive
Strengths IMPSA: Restructuring to Innovate with Existing Resources | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Impsa Executive in IMPSA: Restructuring to Innovate with Existing Resources Harvard Business Review case study are -
Successful track record of launching new products
– Impsa Executive has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Impsa Executive 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 lead change in Global Business field
– Impsa Executive 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 Impsa Executive in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Operational resilience
– The operational resilience strategy in the IMPSA: Restructuring to Innovate with Existing Resources Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Diverse revenue streams
– Impsa Executive is present in almost all the verticals within the industry. This has provided firm in IMPSA: Restructuring to Innovate with Existing Resources 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
– Impsa Executive 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 Daniel Friel 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.
Training and development
– Impsa Executive has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in IMPSA: Restructuring to Innovate with Existing Resources 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.
Low bargaining power of suppliers
– Suppliers of Impsa Executive in the sector have low bargaining power. IMPSA: Restructuring to Innovate with Existing Resources has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Impsa Executive to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Impsa Executive in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Impsa Executive digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Impsa Executive 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.
Cross disciplinary teams
– Horizontal connected teams at the Impsa Executive are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Highly skilled collaborators
– Impsa Executive 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 IMPSA: Restructuring to Innovate with Existing Resources HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High brand equity
– Impsa Executive has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Impsa Executive to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses IMPSA: Restructuring to Innovate with Existing Resources | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of IMPSA: Restructuring to Innovate with Existing Resources are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the IMPSA: Restructuring to Innovate with Existing Resources HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Impsa Executive has relatively successful track record of launching new products.
Workers concerns about automation
– As automation is fast increasing in the segment, Impsa Executive 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study IMPSA: Restructuring to Innovate with Existing Resources, it seems that the employees of Impsa Executive 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.
No frontier risks strategy
– After analyzing the HBR case study IMPSA: Restructuring to Innovate with Existing Resources, it seems that company is thinking about the frontier risks that can impact Global Business 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, Daniel Friel suggests that, Impsa Executive 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.
Skills based hiring
– The stress on hiring functional specialists at Impsa Executive 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.
Increasing silos among functional specialists
– The organizational structure of Impsa Executive is dominated by functional specialists. It is not different from other players in the Global Business segment. Impsa Executive needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Impsa Executive to focus more on services rather than just following the product oriented approach.
Products dominated business model
– Even though Impsa Executive 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 - IMPSA: Restructuring to Innovate with Existing Resources 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, Impsa Executive is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study IMPSA: Restructuring to Innovate with Existing Resources can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Low market penetration in new markets
– Outside its home market of Impsa Executive, firm in the HBR case study IMPSA: Restructuring to Innovate with Existing Resources needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Capital Spending Reduction
– Even during the low interest decade, Impsa Executive 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.
Opportunities IMPSA: Restructuring to Innovate with Existing Resources | 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 IMPSA: Restructuring to Innovate with Existing Resources are -
Buying journey improvements
– Impsa Executive can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. IMPSA: Restructuring to Innovate with Existing Resources 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Impsa Executive is facing challenges because of the dominance of functional experts in the organization. IMPSA: Restructuring to Innovate with Existing Resources 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.
Creating value in data economy
– The success of analytics program of Impsa Executive has opened avenues for new revenue streams for the organization in the industry. This can help Impsa Executive to build a more holistic ecosystem as suggested in the IMPSA: Restructuring to Innovate with Existing Resources case study. Impsa Executive can build new products and services such as - data insight services, data privacy related products, data based consulting services, 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 Impsa Executive in the consumer business. Now Impsa Executive can target international markets with far fewer capital restrictions requirements than the existing system.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Impsa Executive can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, IMPSA: Restructuring to Innovate with Existing Resources, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Using analytics as competitive advantage
– Impsa Executive 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 IMPSA: Restructuring to Innovate with Existing Resources - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Impsa Executive to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Building a culture of innovation
– managers at Impsa Executive 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 Global Business segment.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Global Business industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Impsa Executive 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. Impsa Executive 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.
Developing new processes and practices
– Impsa Executive can develop new processes and procedures in Global Business 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.
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. Impsa Executive can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Impsa Executive in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Global Business segment, and it will provide faster access to the consumers.
Leveraging digital technologies
– Impsa Executive 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Impsa Executive 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.
Threats IMPSA: Restructuring to Innovate with Existing Resources External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study IMPSA: Restructuring to Innovate with Existing Resources are -
High dependence on third party suppliers
– Impsa Executive 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. Impsa Executive 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study IMPSA: Restructuring to Innovate with Existing Resources, Impsa Executive may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Global Business .
Technology acceleration in Forth Industrial Revolution
– Impsa Executive has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Impsa Executive needs to keep up with the evolution of technology in the Global Business 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.
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 Impsa Executive in the Global Business sector and impact the bottomline of the organization.
Consumer confidence and its impact on Impsa Executive 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.
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.
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 Impsa Executive.
Easy access to finance
– Easy access to finance in Global Business field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Impsa Executive can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Regulatory challenges
– Impsa Executive 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 Global Business industry regulations.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Impsa Executive in the Global Business industry. The Global Business 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Impsa Executive 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 IMPSA: Restructuring to Innovate with Existing Resources .
Stagnating economy with rate increase
– Impsa Executive 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 IMPSA: Restructuring to Innovate with Existing Resources 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 IMPSA: Restructuring to Innovate with Existing Resources 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 IMPSA: Restructuring to Innovate with Existing Resources 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 IMPSA: Restructuring to Innovate with Existing Resources 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 IMPSA: Restructuring to Innovate with Existing Resources 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 Impsa Executive needs to make to build a sustainable competitive advantage.
