Power Across Latin America: Endesa de Chile, Spanish Version SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Power Across Latin America: Endesa de Chile, Spanish Version
Endesa, a privatized Chilean electricity generator, has made significant investments in the privatization of Argentina's electricity sector and is now contemplating an even larger privatization opportunity in Peru. In deciding how much to bid in Peru, Endesa must account for the political context in which privatization is being undertaken, as well as a host of other uncertainties.
Swot Analysis of "Power Across Latin America: Endesa de Chile, Spanish Version" written by Pankaj Ghemawat, Patricio Del Sol includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Endesa Privatization facing as an external strategic factors. Some of the topics covered in Power Across Latin America: Endesa de Chile, Spanish Version case study are - Strategic Management Strategies, Economy, Growth strategy, Managing uncertainty and Global Business.
Some of the macro environment factors that can be used to understand the Power Across Latin America: Endesa de Chile, Spanish Version casestudy better are - – there is increasing trade war between United States & China, there is backlash against globalization, central banks are concerned over increasing inflation, increasing commodity prices, talent flight as more people leaving formal jobs, digital marketing is dominated by two big players Facebook and Google, increasing inequality as vast percentage of new income is going to the top 1%,
cloud computing is disrupting traditional business models, geopolitical disruptions, etc
Introduction to SWOT Analysis of Power Across Latin America: Endesa de Chile, Spanish Version
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Power Across Latin America: Endesa de Chile, Spanish Version case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Endesa Privatization, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Endesa Privatization 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 Power Across Latin America: Endesa de Chile, Spanish Version can be done for the following purposes –
1. Strategic planning using facts provided in Power Across Latin America: Endesa de Chile, Spanish Version case study
2. Improving business portfolio management of Endesa Privatization
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 Endesa Privatization
Strengths Power Across Latin America: Endesa de Chile, Spanish Version | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Endesa Privatization in Power Across Latin America: Endesa de Chile, Spanish Version Harvard Business Review case study are -
High switching costs
– The high switching costs that Endesa Privatization has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Diverse revenue streams
– Endesa Privatization is present in almost all the verticals within the industry. This has provided firm in Power Across Latin America: Endesa de Chile, Spanish Version 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 Endesa Privatization 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 Endesa Privatization 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.
Operational resilience
– The operational resilience strategy in the Power Across Latin America: Endesa de Chile, Spanish Version 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.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Endesa Privatization digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Endesa Privatization 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.
Analytics focus
– Endesa Privatization 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 Pankaj Ghemawat, Patricio Del Sol 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.
Sustainable margins compare to other players in Global Business industry
– Power Across Latin America: Endesa de Chile, Spanish Version firm has clearly differentiated products in the market place. This has enabled Endesa Privatization to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Endesa Privatization to invest into research and development (R&D) and innovation.
Low bargaining power of suppliers
– Suppliers of Endesa Privatization in the sector have low bargaining power. Power Across Latin America: Endesa de Chile, Spanish Version has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Endesa Privatization to manage not only supply disruptions but also source products at highly competitive prices.
Training and development
– Endesa Privatization has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Power Across Latin America: Endesa de Chile, Spanish Version 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.
Highly skilled collaborators
– Endesa Privatization 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 Power Across Latin America: Endesa de Chile, Spanish Version HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to lead change in Global Business field
– Endesa Privatization 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 Endesa Privatization in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Weaknesses Power Across Latin America: Endesa de Chile, Spanish Version | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Power Across Latin America: Endesa de Chile, Spanish Version are -
Aligning sales with marketing
– It come across in the case study Power Across Latin America: Endesa de Chile, Spanish Version 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 Power Across Latin America: Endesa de Chile, Spanish Version can leverage the sales team experience to cultivate customer relationships as Endesa Privatization is planning to shift buying processes online.
High operating costs
– Compare to the competitors, firm in the HBR case study Power Across Latin America: Endesa de Chile, Spanish Version 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 Endesa Privatization 's lucrative customers.
Low market penetration in new markets
– Outside its home market of Endesa Privatization, firm in the HBR case study Power Across Latin America: Endesa de Chile, Spanish Version needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
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 Endesa Privatization supply chain. Even after few cautionary changes mentioned in the HBR case study - Power Across Latin America: Endesa de Chile, Spanish Version, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Endesa Privatization vulnerable to further global disruptions in South East Asia.
Capital Spending Reduction
– Even during the low interest decade, Endesa Privatization 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.
No frontier risks strategy
– After analyzing the HBR case study Power Across Latin America: Endesa de Chile, Spanish Version, 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Power Across Latin America: Endesa de Chile, Spanish Version, is just above the industry average. Endesa Privatization needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Slow decision making process
– As mentioned earlier in the report, Endesa Privatization 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. Endesa Privatization 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Endesa Privatization 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Endesa Privatization is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Power Across Latin America: Endesa de Chile, Spanish Version 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 bargaining power of channel partners
– Because of the regulatory requirements, Pankaj Ghemawat, Patricio Del Sol suggests that, Endesa Privatization 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.
Opportunities Power Across Latin America: Endesa de Chile, Spanish Version | 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 Power Across Latin America: Endesa de Chile, Spanish Version are -
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. Endesa Privatization can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Endesa Privatization 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.
Creating value in data economy
– The success of analytics program of Endesa Privatization has opened avenues for new revenue streams for the organization in the industry. This can help Endesa Privatization to build a more holistic ecosystem as suggested in the Power Across Latin America: Endesa de Chile, Spanish Version case study. Endesa Privatization 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, Endesa Privatization 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, Power Across Latin America: Endesa de Chile, Spanish Version, 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 Endesa Privatization 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.
Better consumer reach
– The expansion of the 5G network will help Endesa Privatization to increase its market reach. Endesa Privatization 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Endesa Privatization is facing challenges because of the dominance of functional experts in the organization. Power Across Latin America: Endesa de Chile, Spanish Version 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.
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 Endesa Privatization in the consumer business. Now Endesa Privatization can target international markets with far fewer capital restrictions requirements than the existing system.
Developing new processes and practices
– Endesa Privatization 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.
Leveraging digital technologies
– Endesa Privatization 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.
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. Endesa Privatization can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Endesa Privatization 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 Endesa Privatization to hire the very best people irrespective of their geographical location.
Buying journey improvements
– Endesa Privatization can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Power Across Latin America: Endesa de Chile, Spanish Version 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.
Threats Power Across Latin America: Endesa de Chile, Spanish Version External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Power Across Latin America: Endesa de Chile, Spanish Version are -
Shortening product life cycle
– it is one of the major threat that Endesa Privatization is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Endesa Privatization in the Global Business industry. The Global Business industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Power Across Latin America: Endesa de Chile, Spanish Version, Endesa Privatization may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Global Business .
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Endesa Privatization.
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 Endesa Privatization business can come under increasing regulations regarding data privacy, data security, etc.
Regulatory challenges
– Endesa Privatization 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.
Increasing wage structure of Endesa Privatization
– 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 Endesa Privatization.
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. Endesa Privatization 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 dependence on third party suppliers
– Endesa Privatization 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.
Stagnating economy with rate increase
– Endesa Privatization 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.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Endesa Privatization with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Weighted SWOT Analysis of Power Across Latin America: Endesa de Chile, Spanish Version 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 Power Across Latin America: Endesa de Chile, Spanish Version 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 Power Across Latin America: Endesa de Chile, Spanish Version 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 Power Across Latin America: Endesa de Chile, Spanish Version 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 Power Across Latin America: Endesa de Chile, Spanish Version 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 Endesa Privatization needs to make to build a sustainable competitive advantage.