Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy?
Shortly after presenting its new asset-light strategy involving the division of its operating structure into three separate entities, Abengoa S.A. is faced with a crisis when its stock price drops by half amid investor doubts that the parent company will guarantee a newly issued green bond.
Swot Analysis of "Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy?" written by Jordan Mitchell, Ahmad Rahnema includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Abengoa S.a facing as an external strategic factors. Some of the topics covered in Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? case study are - Strategic Management Strategies, Crisis management, Financial analysis, Financial management and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? casestudy better are - – there is increasing trade war between United States & China, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing household debt because of falling income levels, technology disruption, geopolitical disruptions, digital marketing is dominated by two big players Facebook and Google, wage bills are increasing,
increasing inequality as vast percentage of new income is going to the top 1%, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy?
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Abengoa S.a, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Abengoa S.a 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 Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? can be done for the following purposes –
1. Strategic planning using facts provided in Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? case study
2. Improving business portfolio management of Abengoa S.a
3. Assessing feasibility of the new initiative in Finance & Accounting field.
4. Making a Finance & Accounting topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Abengoa S.a
Strengths Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Abengoa S.a in Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? Harvard Business Review case study are -
Analytics focus
– Abengoa S.a 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 Jordan Mitchell, Ahmad Rahnema 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.
Diverse revenue streams
– Abengoa S.a is present in almost all the verticals within the industry. This has provided firm in Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? 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.
Superior customer experience
– The customer experience strategy of Abengoa S.a in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Operational resilience
– The operational resilience strategy in the Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? 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.
Organizational Resilience of Abengoa S.a
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Abengoa S.a does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Successful track record of launching new products
– Abengoa S.a has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Abengoa S.a 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.
Learning organization
- Abengoa S.a 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 Abengoa S.a is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Strong track record of project management
– Abengoa S.a is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to recruit top talent
– Abengoa S.a is one of the leading recruiters in the industry. Managers in the Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Ability to lead change in Finance & Accounting field
– Abengoa S.a 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 Abengoa S.a in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Highly skilled collaborators
– Abengoa S.a 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 Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? 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 Abengoa S.a 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.
Weaknesses Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? are -
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 Abengoa S.a supply chain. Even after few cautionary changes mentioned in the HBR case study - Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy?, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Abengoa S.a vulnerable to further global disruptions in South East Asia.
Low market penetration in new markets
– Outside its home market of Abengoa S.a, firm in the HBR case study Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Capital Spending Reduction
– Even during the low interest decade, Abengoa S.a 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 star products
– The top 2 products and services of the firm as mentioned in the Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? 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 Abengoa S.a has relatively successful track record of launching new products.
No frontier risks strategy
– After analyzing the HBR case study Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy?, it seems that company is thinking about the frontier risks that can impact Finance & Accounting 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 decision making process
– As mentioned earlier in the report, Abengoa S.a 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. Abengoa S.a 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Abengoa S.a 's lucrative customers.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy?, it seems that the employees of Abengoa S.a 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.
Slow to strategic competitive environment developments
– As Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? HBR case study mentions - Abengoa S.a 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.
Products dominated business model
– Even though Abengoa S.a 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 - Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? 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, Abengoa S.a is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? | 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 Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? are -
Learning at scale
– Online learning technologies has now opened space for Abengoa S.a 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.
Building a culture of innovation
– managers at Abengoa S.a 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 Finance & Accounting segment.
Developing new processes and practices
– Abengoa S.a can develop new processes and procedures in Finance & Accounting 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.
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 Abengoa S.a 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.
Loyalty marketing
– Abengoa S.a 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Abengoa S.a can use these opportunities to build new business models that can help the communities that Abengoa S.a operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
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. Abengoa S.a can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Creating value in data economy
– The success of analytics program of Abengoa S.a has opened avenues for new revenue streams for the organization in the industry. This can help Abengoa S.a to build a more holistic ecosystem as suggested in the Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? case study. Abengoa S.a can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Abengoa S.a 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, Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy?, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Abengoa S.a can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Leveraging digital technologies
– Abengoa S.a 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.
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 Abengoa S.a in the consumer business. Now Abengoa S.a can target international markets with far fewer capital restrictions requirements than the existing system.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Finance & Accounting industry, but it has also influenced the consumer preferences. Abengoa S.a can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? are -
Regulatory challenges
– Abengoa S.a 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 Finance & Accounting industry regulations.
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 Abengoa S.a business can come under increasing regulations regarding data privacy, data security, etc.
Shortening product life cycle
– it is one of the major threat that Abengoa S.a is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Abengoa S.a 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.
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. Abengoa S.a needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Abengoa S.a in the Finance & Accounting industry. The Finance & Accounting 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.
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 Abengoa S.a in the Finance & Accounting sector and impact the bottomline of the organization.
Environmental challenges
– Abengoa S.a 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. Abengoa S.a can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Easy access to finance
– Easy access to finance in Finance & Accounting field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Abengoa S.a can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
Stagnating economy with rate increase
– Abengoa S.a 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.
Consumer confidence and its impact on Abengoa S.a 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.
Increasing wage structure of Abengoa S.a
– 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 Abengoa S.a.
Weighted SWOT Analysis of Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? 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 Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? 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 Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? 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 Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? 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 Abengoa S.A.: The Unveiling or Unraveling of a Bold New Strategy? 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 Abengoa S.a needs to make to build a sustainable competitive advantage.
