"God is Brazilian": Turning Alcohol into Fuel SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of "God is Brazilian": Turning Alcohol into Fuel
In September 1979, while Brazil is treading the uncertain and dangerous waters of an oil crisis that has exacerbated the country?s balance of payment, Mario Garnero, the president of the National Association of Automotive Vehicle Manufacturers (ANFAVEA), is desperately looking for an escape to avoid the imminent threat of gasoline rationing and to contain the oil dependency of his country. The idea of developing a local ethanol industry and to produce vehicles that run exclusively on ethanol takes shape step by step, between the different reactions, interests and concerns of five actors: the automakers, the sugar producers, the state owned petrol company, the Government and most importantly the Brazilian customers. This case provides the background for a debate on what were the reasons behind the decision of the government to embark on the ethanol plan, on what were the concerns of the main stakeholders and on how the government should address the requests and the conditions of each of them, in order to implement the right set of measures for the plan effectively takes off and for Brazil to emerge from the crisis and to end its long and painful external oil dependency. The case is a fictional story, although mainly inspired by the real facts, from the perspective of our main character, Mario Garnero, considered the "Father of the Ethanol Car in Brazil".
Authors :: Paola Giordano, Felix Sanchez, Ahmad Rahnema
Swot Analysis of ""God is Brazilian": Turning Alcohol into Fuel" written by Paola Giordano, Felix Sanchez, Ahmad Rahnema includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Ethanol Garnero facing as an external strategic factors. Some of the topics covered in "God is Brazilian": Turning Alcohol into Fuel case study are - Strategic Management Strategies, and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the "God is Brazilian": Turning Alcohol into Fuel casestudy better are - – supply chains are disrupted by pandemic , geopolitical disruptions, increasing transportation and logistics costs, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing energy prices, central banks are concerned over increasing inflation, cloud computing is disrupting traditional business models,
competitive advantages are harder to sustain because of technology dispersion, technology disruption, etc
Introduction to SWOT Analysis of "God is Brazilian": Turning Alcohol into Fuel
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in "God is Brazilian": Turning Alcohol into Fuel case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Ethanol Garnero, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Ethanol Garnero 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 "God is Brazilian": Turning Alcohol into Fuel can be done for the following purposes –
1. Strategic planning using facts provided in "God is Brazilian": Turning Alcohol into Fuel case study
2. Improving business portfolio management of Ethanol Garnero
3. Assessing feasibility of the new initiative in Leadership & Managing People field.
4. Making a Leadership & Managing People topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Ethanol Garnero
Strengths "God is Brazilian": Turning Alcohol into Fuel | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Ethanol Garnero in "God is Brazilian": Turning Alcohol into Fuel Harvard Business Review case study are -
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Ethanol Garnero digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Ethanol Garnero 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.
Training and development
– Ethanol Garnero has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in "God is Brazilian": Turning Alcohol into Fuel 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.
High brand equity
– Ethanol Garnero has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Ethanol Garnero to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in Leadership & Managing People industry
– "God is Brazilian": Turning Alcohol into Fuel firm has clearly differentiated products in the market place. This has enabled Ethanol Garnero to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Ethanol Garnero to invest into research and development (R&D) and innovation.
Organizational Resilience of Ethanol Garnero
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Ethanol Garnero does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Learning organization
- Ethanol Garnero 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 Ethanol Garnero is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in "God is Brazilian": Turning Alcohol into Fuel Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to lead change in Leadership & Managing People field
– Ethanol Garnero 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 Ethanol Garnero in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Highly skilled collaborators
– Ethanol Garnero 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 "God is Brazilian": Turning Alcohol into Fuel HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Cross disciplinary teams
– Horizontal connected teams at the Ethanol Garnero 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.
Diverse revenue streams
– Ethanol Garnero is present in almost all the verticals within the industry. This has provided firm in "God is Brazilian": Turning Alcohol into Fuel 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.
Effective Research and Development (R&D)
– Ethanol Garnero 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 "God is Brazilian": Turning Alcohol into Fuel - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to recruit top talent
– Ethanol Garnero is one of the leading recruiters in the industry. Managers in the "God is Brazilian": Turning Alcohol into Fuel are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Weaknesses "God is Brazilian": Turning Alcohol into Fuel | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of "God is Brazilian": Turning Alcohol into Fuel are -
High bargaining power of channel partners
– Because of the regulatory requirements, Paola Giordano, Felix Sanchez, Ahmad Rahnema suggests that, Ethanol Garnero 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.
Capital Spending Reduction
– Even during the low interest decade, Ethanol Garnero 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study "God is Brazilian": Turning Alcohol into Fuel, it seems that the employees of Ethanol Garnero 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.
Lack of clear differentiation of Ethanol Garnero products
– To increase the profitability and margins on the products, Ethanol Garnero needs to provide more differentiated products than what it is currently offering in the marketplace.
Skills based hiring
– The stress on hiring functional specialists at Ethanol Garnero 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.
Aligning sales with marketing
– It come across in the case study "God is Brazilian": Turning Alcohol into Fuel 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 "God is Brazilian": Turning Alcohol into Fuel can leverage the sales team experience to cultivate customer relationships as Ethanol Garnero is planning to shift buying processes online.
No frontier risks strategy
– After analyzing the HBR case study "God is Brazilian": Turning Alcohol into Fuel, it seems that company is thinking about the frontier risks that can impact Leadership & Managing People 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Ethanol Garnero is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study "God is Brazilian": Turning Alcohol into Fuel 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
Ethanol Garnero 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Ethanol Garnero 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.
Low market penetration in new markets
– Outside its home market of Ethanol Garnero, firm in the HBR case study "God is Brazilian": Turning Alcohol into Fuel needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Opportunities "God is Brazilian": Turning Alcohol into Fuel | 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 "God is Brazilian": Turning Alcohol into Fuel are -
Low interest rates
– Even though inflation is raising its head in most developed economies, Ethanol Garnero 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 Leadership & Managing People industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Ethanol Garnero 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. Ethanol Garnero 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Ethanol Garnero is facing challenges because of the dominance of functional experts in the organization. "God is Brazilian": Turning Alcohol into Fuel 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.
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 Ethanol Garnero 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Ethanol Garnero can use these opportunities to build new business models that can help the communities that Ethanol Garnero operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Better consumer reach
– The expansion of the 5G network will help Ethanol Garnero to increase its market reach. Ethanol Garnero 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.
Using analytics as competitive advantage
– Ethanol Garnero 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 "God is Brazilian": Turning Alcohol into Fuel - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Ethanol Garnero to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Leadership & Managing People industry, but it has also influenced the consumer preferences. Ethanol Garnero can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Buying journey improvements
– Ethanol Garnero can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. "God is Brazilian": Turning Alcohol into Fuel 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.
Learning at scale
– Online learning technologies has now opened space for Ethanol Garnero 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.
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 Ethanol Garnero in the consumer business. Now Ethanol Garnero 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, Ethanol Garnero 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, "God is Brazilian": Turning Alcohol into Fuel, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Leveraging digital technologies
– Ethanol Garnero 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.
Threats "God is Brazilian": Turning Alcohol into Fuel External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study "God is Brazilian": Turning Alcohol into Fuel are -
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Ethanol Garnero.
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 Ethanol Garnero in the Leadership & Managing People sector and impact the bottomline of the organization.
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. Ethanol Garnero 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
– Ethanol Garnero 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Ethanol Garnero 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 "God is Brazilian": Turning Alcohol into Fuel .
Environmental challenges
– Ethanol Garnero 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. Ethanol Garnero can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Consumer confidence and its impact on Ethanol Garnero demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
High dependence on third party suppliers
– Ethanol Garnero 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Ethanol Garnero with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Shortening product life cycle
– it is one of the major threat that Ethanol Garnero is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Easy access to finance
– Easy access to finance in Leadership & Managing People field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Ethanol Garnero can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Ethanol Garnero needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
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.
Weighted SWOT Analysis of "God is Brazilian": Turning Alcohol into Fuel 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 "God is Brazilian": Turning Alcohol into Fuel 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 "God is Brazilian": Turning Alcohol into Fuel 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 "God is Brazilian": Turning Alcohol into Fuel 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 "God is Brazilian": Turning Alcohol into Fuel 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 Ethanol Garnero needs to make to build a sustainable competitive advantage.
