Swot Analysis of "Cosmeticos de Espana, S.A. (F)" written by David F. Hawkins includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Cosmeticos Espana facing as an external strategic factors. Some of the topics covered in Cosmeticos de Espana, S.A. (F) case study are - Strategic Management Strategies, Currency, Financial management and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Cosmeticos de Espana, S.A. (F) casestudy better are - – supply chains are disrupted by pandemic , increasing household debt because of falling income levels, challanges to central banks by blockchain based private currencies, increasing energy prices, banking and financial system is disrupted by Bitcoin and other crypto currencies, competitive advantages are harder to sustain because of technology dispersion, increasing commodity prices,
wage bills are increasing, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Cosmeticos de Espana, S.A. (F)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Cosmeticos de Espana, S.A. (F) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Cosmeticos Espana, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Cosmeticos Espana 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 Cosmeticos de Espana, S.A. (F) can be done for the following purposes –
1. Strategic planning using facts provided in Cosmeticos de Espana, S.A. (F) case study
2. Improving business portfolio management of Cosmeticos Espana
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 Cosmeticos Espana
Strengths Cosmeticos de Espana, S.A. (F) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Cosmeticos Espana in Cosmeticos de Espana, S.A. (F) Harvard Business Review case study are -
Learning organization
- Cosmeticos Espana 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 Cosmeticos Espana is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Cosmeticos de Espana, S.A. (F) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
High brand equity
– Cosmeticos Espana has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Cosmeticos Espana to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Cosmeticos Espana digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Cosmeticos Espana 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.
Successful track record of launching new products
– Cosmeticos Espana has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Cosmeticos Espana 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
– Cosmeticos Espana is one of the leading recruiters in the industry. Managers in the Cosmeticos de Espana, S.A. (F) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Superior customer experience
– The customer experience strategy of Cosmeticos Espana in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the Cosmeticos Espana 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.
Sustainable margins compare to other players in Finance & Accounting industry
– Cosmeticos de Espana, S.A. (F) firm has clearly differentiated products in the market place. This has enabled Cosmeticos Espana to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Cosmeticos Espana to invest into research and development (R&D) and innovation.
Ability to lead change in Finance & Accounting field
– Cosmeticos Espana 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 Cosmeticos Espana in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Diverse revenue streams
– Cosmeticos Espana is present in almost all the verticals within the industry. This has provided firm in Cosmeticos de Espana, S.A. (F) 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.
Organizational Resilience of Cosmeticos Espana
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Cosmeticos Espana does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Analytics focus
– Cosmeticos Espana 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 David F. Hawkins 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.
Weaknesses Cosmeticos de Espana, S.A. (F) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Cosmeticos de Espana, S.A. (F) are -
Aligning sales with marketing
– It come across in the case study Cosmeticos de Espana, S.A. (F) 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 Cosmeticos de Espana, S.A. (F) can leverage the sales team experience to cultivate customer relationships as Cosmeticos Espana is planning to shift buying processes online.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Cosmeticos de Espana, S.A. (F) 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 Cosmeticos Espana has relatively successful track record of launching new products.
Increasing silos among functional specialists
– The organizational structure of Cosmeticos Espana is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Cosmeticos Espana needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Cosmeticos Espana to focus more on services rather than just following the product oriented approach.
Interest costs
– Compare to the competition, Cosmeticos Espana 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.
Products dominated business model
– Even though Cosmeticos Espana 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 - Cosmeticos de Espana, S.A. (F) 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, Cosmeticos Espana is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Cosmeticos de Espana, S.A. (F) 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
Cosmeticos Espana 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.
Capital Spending Reduction
– Even during the low interest decade, Cosmeticos Espana 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 Cosmeticos de Espana, S.A. (F), in the dynamic environment Cosmeticos Espana has struggled to respond to the nimble upstart competition. Cosmeticos Espana has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Low market penetration in new markets
– Outside its home market of Cosmeticos Espana, firm in the HBR case study Cosmeticos de Espana, S.A. (F) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow decision making process
– As mentioned earlier in the report, Cosmeticos Espana 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. Cosmeticos Espana 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.
Opportunities Cosmeticos de Espana, S.A. (F) | 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 Cosmeticos de Espana, S.A. (F) are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Cosmeticos Espana is facing challenges because of the dominance of functional experts in the organization. Cosmeticos de Espana, S.A. (F) 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Cosmeticos Espana 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 Cosmeticos Espana to hire the very best people irrespective of their geographical location.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Cosmeticos Espana 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, Cosmeticos de Espana, S.A. (F), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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 Cosmeticos Espana 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.
Building a culture of innovation
– managers at Cosmeticos Espana 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.
Loyalty marketing
– Cosmeticos Espana 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Cosmeticos Espana in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Finance & Accounting segment, and it will provide faster access to the consumers.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Cosmeticos Espana can use these opportunities to build new business models that can help the communities that Cosmeticos Espana operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Developing new processes and practices
– Cosmeticos Espana 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.
Manufacturing automation
– Cosmeticos Espana can use the latest technology developments to improve its manufacturing and designing process in Finance & Accounting segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Leveraging digital technologies
– Cosmeticos Espana 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Finance & Accounting industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Cosmeticos Espana 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. Cosmeticos Espana 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.
Creating value in data economy
– The success of analytics program of Cosmeticos Espana has opened avenues for new revenue streams for the organization in the industry. This can help Cosmeticos Espana to build a more holistic ecosystem as suggested in the Cosmeticos de Espana, S.A. (F) case study. Cosmeticos Espana can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats Cosmeticos de Espana, S.A. (F) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Cosmeticos de Espana, S.A. (F) are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Cosmeticos Espana 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.
Increasing wage structure of Cosmeticos Espana
– 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 Cosmeticos Espana.
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 Cosmeticos Espana.
Technology acceleration in Forth Industrial Revolution
– Cosmeticos Espana has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Cosmeticos Espana needs to keep up with the evolution of technology in the Finance & Accounting 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.
Environmental challenges
– Cosmeticos Espana 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. Cosmeticos Espana can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Shortening product life cycle
– it is one of the major threat that Cosmeticos Espana is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Cosmeticos Espana in the Finance & Accounting sector and impact the bottomline of the organization.
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 Cosmeticos Espana business can come under increasing regulations regarding data privacy, data security, etc.
Consumer confidence and its impact on Cosmeticos Espana 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.
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.
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. Cosmeticos Espana can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Cosmeticos Espana with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Cosmeticos de Espana, S.A. (F), Cosmeticos Espana may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Finance & Accounting .
Weighted SWOT Analysis of Cosmeticos de Espana, S.A. (F) 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 Cosmeticos de Espana, S.A. (F) 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 Cosmeticos de Espana, S.A. (F) 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 Cosmeticos de Espana, S.A. (F) 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 Cosmeticos de Espana, S.A. (F) 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 Cosmeticos Espana needs to make to build a sustainable competitive advantage.