Swot Analysis of "Argentina's YPF Sociedad Anonima (C)" written by Michael Y. Yoshino, Carin-Isabel Knoop includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Anonima Sociedad facing as an external strategic factors. Some of the topics covered in Argentina's YPF Sociedad Anonima (C) case study are - Strategic Management Strategies, International business and Global Business.
Some of the macro environment factors that can be used to understand the Argentina's YPF Sociedad Anonima (C) casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, there is increasing trade war between United States & China, increasing transportation and logistics costs, increasing household debt because of falling income levels, challanges to central banks by blockchain based private currencies, increasing commodity prices, increasing energy prices,
geopolitical disruptions, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of Argentina's YPF Sociedad Anonima (C)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Argentina's YPF Sociedad Anonima (C) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Anonima Sociedad, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Anonima Sociedad 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 Argentina's YPF Sociedad Anonima (C) can be done for the following purposes –
1. Strategic planning using facts provided in Argentina's YPF Sociedad Anonima (C) case study
2. Improving business portfolio management of Anonima Sociedad
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 Anonima Sociedad
Strengths Argentina's YPF Sociedad Anonima (C) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Anonima Sociedad in Argentina's YPF Sociedad Anonima (C) Harvard Business Review case study are -
Superior customer experience
– The customer experience strategy of Anonima Sociedad in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Effective Research and Development (R&D)
– Anonima Sociedad 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 Argentina's YPF Sociedad Anonima (C) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Learning organization
- Anonima Sociedad 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 Anonima Sociedad is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Argentina's YPF Sociedad Anonima (C) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in Global Business industry
– Argentina's YPF Sociedad Anonima (C) firm has clearly differentiated products in the market place. This has enabled Anonima Sociedad to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Anonima Sociedad to invest into research and development (R&D) and innovation.
Organizational Resilience of Anonima Sociedad
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Anonima Sociedad does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– Anonima Sociedad has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Argentina's YPF Sociedad Anonima (C) 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.
Diverse revenue streams
– Anonima Sociedad is present in almost all the verticals within the industry. This has provided firm in Argentina's YPF Sociedad Anonima (C) 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.
Strong track record of project management
– Anonima Sociedad is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Anonima Sociedad digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Anonima Sociedad 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.
Innovation driven organization
– Anonima Sociedad is one of the most innovative firm in sector. Manager in Argentina's YPF Sociedad Anonima (C) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Ability to lead change in Global Business field
– Anonima Sociedad 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 Anonima Sociedad in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Cross disciplinary teams
– Horizontal connected teams at the Anonima Sociedad 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 Argentina's YPF Sociedad Anonima (C) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Argentina's YPF Sociedad Anonima (C) are -
Low market penetration in new markets
– Outside its home market of Anonima Sociedad, firm in the HBR case study Argentina's YPF Sociedad Anonima (C) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow decision making process
– As mentioned earlier in the report, Anonima Sociedad 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. Anonima Sociedad 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.
Skills based hiring
– The stress on hiring functional specialists at Anonima Sociedad has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Argentina's YPF Sociedad Anonima (C), is just above the industry average. Anonima Sociedad 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 to strategic competitive environment developments
– As Argentina's YPF Sociedad Anonima (C) HBR case study mentions - Anonima Sociedad 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Argentina's YPF Sociedad Anonima (C), in the dynamic environment Anonima Sociedad has struggled to respond to the nimble upstart competition. Anonima Sociedad has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Increasing silos among functional specialists
– The organizational structure of Anonima Sociedad is dominated by functional specialists. It is not different from other players in the Global Business segment. Anonima Sociedad needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Anonima Sociedad to focus more on services rather than just following the product oriented approach.
Products dominated business model
– Even though Anonima Sociedad 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 - Argentina's YPF Sociedad Anonima (C) should strive to include more intangible value offerings along with its core products and services.
Aligning sales with marketing
– It come across in the case study Argentina's YPF Sociedad Anonima (C) 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 Argentina's YPF Sociedad Anonima (C) can leverage the sales team experience to cultivate customer relationships as Anonima Sociedad is planning to shift buying processes online.
Workers concerns about automation
– As automation is fast increasing in the segment, Anonima Sociedad 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.
No frontier risks strategy
– After analyzing the HBR case study Argentina's YPF Sociedad Anonima (C), 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.
Opportunities Argentina's YPF Sociedad Anonima (C) | 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 Argentina's YPF Sociedad Anonima (C) are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Anonima Sociedad can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Loyalty marketing
– Anonima Sociedad 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Anonima Sociedad is facing challenges because of the dominance of functional experts in the organization. Argentina's YPF Sociedad Anonima (C) 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 Anonima Sociedad 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 Anonima Sociedad to hire the very best people irrespective of their geographical location.
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 Anonima Sociedad in the consumer business. Now Anonima Sociedad can target international markets with far fewer capital restrictions requirements than the existing system.
Learning at scale
– Online learning technologies has now opened space for Anonima Sociedad 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Anonima Sociedad 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, Argentina's YPF Sociedad Anonima (C), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Creating value in data economy
– The success of analytics program of Anonima Sociedad has opened avenues for new revenue streams for the organization in the industry. This can help Anonima Sociedad to build a more holistic ecosystem as suggested in the Argentina's YPF Sociedad Anonima (C) case study. Anonima Sociedad can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Anonima Sociedad can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Argentina's YPF Sociedad Anonima (C) 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Anonima Sociedad 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.
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. Anonima Sociedad can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Global Business industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Anonima Sociedad 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. Anonima Sociedad 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Anonima Sociedad can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Threats Argentina's YPF Sociedad Anonima (C) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Argentina's YPF Sociedad Anonima (C) are -
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. Anonima Sociedad needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Argentina's YPF Sociedad Anonima (C), Anonima Sociedad 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 .
High dependence on third party suppliers
– Anonima Sociedad 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.
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. Anonima Sociedad 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.
Technology acceleration in Forth Industrial Revolution
– Anonima Sociedad has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Anonima Sociedad 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Anonima Sociedad with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Anonima Sociedad in the Global Business sector and impact the bottomline of the organization.
Increasing wage structure of Anonima Sociedad
– 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 Anonima Sociedad.
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. Anonima Sociedad can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Regulatory challenges
– Anonima Sociedad 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.
Shortening product life cycle
– it is one of the major threat that Anonima Sociedad is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Anonima Sociedad business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Anonima Sociedad 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.
Weighted SWOT Analysis of Argentina's YPF Sociedad Anonima (C) 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 Argentina's YPF Sociedad Anonima (C) 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 Argentina's YPF Sociedad Anonima (C) 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 Argentina's YPF Sociedad Anonima (C) 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 Argentina's YPF Sociedad Anonima (C) 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 Anonima Sociedad needs to make to build a sustainable competitive advantage.