Revenue Flow and Human Rights: A Paradox for Shell Nigeria SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Revenue Flow and Human Rights: A Paradox for Shell Nigeria
The case describes Shell's evolution within the context of sensitive human rights issues related to oil exploration and exploitation in Nigeria. Given that much of the revenue from Nigerian oil resources was being "siphoned" off by corrupt state governors, the case focuses on issues relevant to government transparency and corruption. It describes Shell's involvement in the Extractive Industries Transparency Initiative (EITI) and its collaboration with the Nigerian Government to instigate a more transparent reporting on oil revenues. However, since two senior Shell executives involved in EITI and negotiations with the government are about to retire from the company, the prospect of briefing their successors on the complexity of the Nigerian situation brings a number of questions that still remain to be answered "to the table". Learning objective: Participants learn about the invasive nature of corruption and its effect on human rights, but more specifically about the role of a multinational versus the role of the government when trying to deal with such issues. Participants will also learn a great deal about the complexity of sustainability issues for corporations, particularly human rights, issues. There is also learning about the scope and limits of corporate responsibility, and the difficulties that all players face in tough market conditions and a on a "non-level playing field". Participants can develop new insights on ways of operating responsibly, creating valuable partnerships and interacting in a global, but socially responsible, context.
Swot Analysis of "Revenue Flow and Human Rights: A Paradox for Shell Nigeria" written by Ulrich Steger, Aileen Ionescu-Somers includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Nigerian Eiti facing as an external strategic factors. Some of the topics covered in Revenue Flow and Human Rights: A Paradox for Shell Nigeria case study are - Strategic Management Strategies, Social responsibility, Sustainability, Transparency and Global Business.
Some of the macro environment factors that can be used to understand the Revenue Flow and Human Rights: A Paradox for Shell Nigeria casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, there is backlash against globalization, increasing government debt because of Covid-19 spendings, supply chains are disrupted by pandemic , increasing household debt because of falling income levels, increasing commodity prices, geopolitical disruptions,
increasing energy prices, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Revenue Flow and Human Rights: A Paradox for Shell Nigeria
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Revenue Flow and Human Rights: A Paradox for Shell Nigeria case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Nigerian Eiti, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Nigerian Eiti 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 Revenue Flow and Human Rights: A Paradox for Shell Nigeria can be done for the following purposes –
1. Strategic planning using facts provided in Revenue Flow and Human Rights: A Paradox for Shell Nigeria case study
2. Improving business portfolio management of Nigerian Eiti
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 Nigerian Eiti
Strengths Revenue Flow and Human Rights: A Paradox for Shell Nigeria | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Nigerian Eiti in Revenue Flow and Human Rights: A Paradox for Shell Nigeria Harvard Business Review case study are -
Operational resilience
– The operational resilience strategy in the Revenue Flow and Human Rights: A Paradox for Shell Nigeria 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.
Training and development
– Nigerian Eiti has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Revenue Flow and Human Rights: A Paradox for Shell Nigeria 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.
Sustainable margins compare to other players in Global Business industry
– Revenue Flow and Human Rights: A Paradox for Shell Nigeria firm has clearly differentiated products in the market place. This has enabled Nigerian Eiti to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Nigerian Eiti to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Nigerian Eiti 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.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Nigerian Eiti digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Nigerian Eiti 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.
Organizational Resilience of Nigerian Eiti
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Nigerian Eiti does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Analytics focus
– Nigerian Eiti 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 Ulrich Steger, Aileen Ionescu-Somers 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.
Learning organization
- Nigerian Eiti 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 Nigerian Eiti is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Revenue Flow and Human Rights: A Paradox for Shell Nigeria Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Low bargaining power of suppliers
– Suppliers of Nigerian Eiti in the sector have low bargaining power. Revenue Flow and Human Rights: A Paradox for Shell Nigeria has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Nigerian Eiti to manage not only supply disruptions but also source products at highly competitive prices.
Innovation driven organization
– Nigerian Eiti is one of the most innovative firm in sector. Manager in Revenue Flow and Human Rights: A Paradox for Shell Nigeria Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Effective Research and Development (R&D)
– Nigerian Eiti 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 Revenue Flow and Human Rights: A Paradox for Shell Nigeria - 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 lead change in Global Business field
– Nigerian Eiti 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 Nigerian Eiti in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Weaknesses Revenue Flow and Human Rights: A Paradox for Shell Nigeria | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Revenue Flow and Human Rights: A Paradox for Shell Nigeria 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 Nigerian Eiti supply chain. Even after few cautionary changes mentioned in the HBR case study - Revenue Flow and Human Rights: A Paradox for Shell Nigeria, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Nigerian Eiti vulnerable to further global disruptions in South East Asia.
High operating costs
– Compare to the competitors, firm in the HBR case study Revenue Flow and Human Rights: A Paradox for Shell Nigeria 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 Nigerian Eiti 's lucrative customers.
High cash cycle compare to competitors
Nigerian Eiti 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, Nigerian Eiti 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 Revenue Flow and Human Rights: A Paradox for Shell Nigeria, it seems that the employees of Nigerian Eiti 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 Revenue Flow and Human Rights: A Paradox for Shell Nigeria, 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Nigerian Eiti is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Revenue Flow and Human Rights: A Paradox for Shell Nigeria 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 Nigerian Eiti, firm in the HBR case study Revenue Flow and Human Rights: A Paradox for Shell Nigeria needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Revenue Flow and Human Rights: A Paradox for Shell Nigeria 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 Nigerian Eiti has relatively successful track record of launching new products.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Revenue Flow and Human Rights: A Paradox for Shell Nigeria, in the dynamic environment Nigerian Eiti has struggled to respond to the nimble upstart competition. Nigerian Eiti has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Interest costs
– Compare to the competition, Nigerian Eiti 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.
Opportunities Revenue Flow and Human Rights: A Paradox for Shell Nigeria | 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 Revenue Flow and Human Rights: A Paradox for Shell Nigeria are -
Using analytics as competitive advantage
– Nigerian Eiti 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 Revenue Flow and Human Rights: A Paradox for Shell Nigeria - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Nigerian Eiti to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Developing new processes and practices
– Nigerian Eiti 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.
Building a culture of innovation
– managers at Nigerian Eiti 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Nigerian Eiti can use these opportunities to build new business models that can help the communities that Nigerian Eiti operates in. Secondly it can use opportunities from government spending in Global Business sector.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Global Business industry, but it has also influenced the consumer preferences. Nigerian Eiti can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Nigerian Eiti 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 Nigerian Eiti to hire the very best people irrespective of their geographical location.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Nigerian Eiti is facing challenges because of the dominance of functional experts in the organization. Revenue Flow and Human Rights: A Paradox for Shell Nigeria 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 Nigerian Eiti 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Nigerian Eiti 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Nigerian Eiti can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Nigerian Eiti can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Nigerian Eiti 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, Revenue Flow and Human Rights: A Paradox for Shell Nigeria, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Manufacturing automation
– Nigerian Eiti can use the latest technology developments to improve its manufacturing and designing process in Global Business 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.
Threats Revenue Flow and Human Rights: A Paradox for Shell Nigeria External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Revenue Flow and Human Rights: A Paradox for Shell Nigeria are -
Environmental challenges
– Nigerian Eiti 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. Nigerian Eiti can take advantage of this fund but it will also bring new competitors in the Global Business industry.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Nigerian Eiti with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Nigerian Eiti.
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 Nigerian Eiti in the Global Business sector and impact the bottomline of the organization.
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. Nigerian Eiti needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.
Stagnating economy with rate increase
– Nigerian Eiti 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.
Regulatory challenges
– Nigerian Eiti 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.
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. Nigerian Eiti can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Consumer confidence and its impact on Nigerian Eiti 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
– Nigerian Eiti 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.
Technology acceleration in Forth Industrial Revolution
– Nigerian Eiti has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Nigerian Eiti 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Nigerian Eiti 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 Revenue Flow and Human Rights: A Paradox for Shell Nigeria .
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 Revenue Flow and Human Rights: A Paradox for Shell Nigeria 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 Revenue Flow and Human Rights: A Paradox for Shell Nigeria 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 Revenue Flow and Human Rights: A Paradox for Shell Nigeria 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 Revenue Flow and Human Rights: A Paradox for Shell Nigeria 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 Revenue Flow and Human Rights: A Paradox for Shell Nigeria 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 Nigerian Eiti needs to make to build a sustainable competitive advantage.