Banco Ciudad (A): Who is the Owner SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Banco Ciudad (A): Who is the Owner
To maximize their effectiveness, color cases should be printed in color.The state-run Banco de la Ciudad de Buenos Aires (Banco Ciudad) was losing money in 2007. Early in 2008, Federico Sturzenegger, a renowned academic in Argentina, was appointed executive chairman by the city government and charged with turning the bank around. But just four months later, Sturzenegger was already facing the 45th day of a labor conflict sparked by union representatives on account of having fired six employees. The showdown raised several questions. First and foremost: Who owned Banco Ciudad? The city government? The citizens? Its employees? How could this bank use its strengths and overcome its weaknesses to best serve its constituents and the public? This case follows Sturzenegger's eventful first few years in office to examine how a state-owned enterprise maneuvered in a challenging environment to hit its targets of greater efficiency and profitability.
Authors :: Aldo Musacchio, Gustavo A. Herrero, Cintra Scott
Swot Analysis of "Banco Ciudad (A): Who is the Owner" written by Aldo Musacchio, Gustavo A. Herrero, Cintra Scott includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Ciudad Banco facing as an external strategic factors. Some of the topics covered in Banco Ciudad (A): Who is the Owner case study are - Strategic Management Strategies, Government and Global Business.
Some of the macro environment factors that can be used to understand the Banco Ciudad (A): Who is the Owner casestudy better are - – there is increasing trade war between United States & China, cloud computing is disrupting traditional business models, increasing commodity prices, increasing inequality as vast percentage of new income is going to the top 1%, there is backlash against globalization, increasing household debt because of falling income levels, talent flight as more people leaving formal jobs,
increasing energy prices, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of Banco Ciudad (A): Who is the Owner
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Banco Ciudad (A): Who is the Owner case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Ciudad Banco, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Ciudad Banco 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 Banco Ciudad (A): Who is the Owner can be done for the following purposes –
1. Strategic planning using facts provided in Banco Ciudad (A): Who is the Owner case study
2. Improving business portfolio management of Ciudad Banco
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 Ciudad Banco
Strengths Banco Ciudad (A): Who is the Owner | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Ciudad Banco in Banco Ciudad (A): Who is the Owner Harvard Business Review case study are -
High brand equity
– Ciudad Banco has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Ciudad Banco to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Ciudad Banco is present in almost all the verticals within the industry. This has provided firm in Banco Ciudad (A): Who is the Owner 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.
Learning organization
- Ciudad Banco 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 Ciudad Banco is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Banco Ciudad (A): Who is the Owner Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– Ciudad Banco is one of the most innovative firm in sector. Manager in Banco Ciudad (A): Who is the Owner Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Strong track record of project management
– Ciudad Banco is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Cross disciplinary teams
– Horizontal connected teams at the Ciudad Banco 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.
Superior customer experience
– The customer experience strategy of Ciudad Banco in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to lead change in Global Business field
– Ciudad Banco 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 Ciudad Banco in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Successful track record of launching new products
– Ciudad Banco has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Ciudad Banco 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
– Ciudad Banco is one of the leading recruiters in the industry. Managers in the Banco Ciudad (A): Who is the Owner are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Highly skilled collaborators
– Ciudad Banco 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 Banco Ciudad (A): Who is the Owner HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High switching costs
– The high switching costs that Ciudad Banco 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.
Weaknesses Banco Ciudad (A): Who is the Owner | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Banco Ciudad (A): Who is the Owner are -
High cash cycle compare to competitors
Ciudad Banco 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Banco Ciudad (A): Who is the Owner, in the dynamic environment Ciudad Banco has struggled to respond to the nimble upstart competition. Ciudad Banco 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, Ciudad Banco 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Ciudad Banco 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 Banco Ciudad (A): Who is the Owner, it seems that the employees of Ciudad Banco 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.
Skills based hiring
– The stress on hiring functional specialists at Ciudad Banco 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Aldo Musacchio, Gustavo A. Herrero, Cintra Scott suggests that, Ciudad Banco 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Banco Ciudad (A): Who is the Owner 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 Ciudad Banco has relatively successful track record of launching new products.
Aligning sales with marketing
– It come across in the case study Banco Ciudad (A): Who is the Owner 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 Banco Ciudad (A): Who is the Owner can leverage the sales team experience to cultivate customer relationships as Ciudad Banco is planning to shift buying processes online.
No frontier risks strategy
– After analyzing the HBR case study Banco Ciudad (A): Who is the Owner, 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, Ciudad Banco is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Banco Ciudad (A): Who is the Owner can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities Banco Ciudad (A): Who is the Owner | 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 Banco Ciudad (A): Who is the Owner are -
Leveraging digital technologies
– Ciudad Banco 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Ciudad Banco 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Ciudad Banco can use these opportunities to build new business models that can help the communities that Ciudad Banco operates in. Secondly it can use opportunities from government spending in Global Business sector.
Loyalty marketing
– Ciudad Banco 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.
Creating value in data economy
– The success of analytics program of Ciudad Banco has opened avenues for new revenue streams for the organization in the industry. This can help Ciudad Banco to build a more holistic ecosystem as suggested in the Banco Ciudad (A): Who is the Owner case study. Ciudad Banco can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Low interest rates
– Even though inflation is raising its head in most developed economies, Ciudad Banco 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.
Learning at scale
– Online learning technologies has now opened space for Ciudad Banco 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Ciudad Banco can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Ciudad Banco 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. Ciudad Banco 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.
Building a culture of innovation
– managers at Ciudad Banco 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.
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 Ciudad Banco in the consumer business. Now Ciudad Banco can target international markets with far fewer capital restrictions requirements than the existing system.
Manufacturing automation
– Ciudad Banco 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.
Buying journey improvements
– Ciudad Banco can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Banco Ciudad (A): Who is the Owner 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 Banco Ciudad (A): Who is the Owner External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Banco Ciudad (A): Who is the Owner are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Ciudad Banco 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Ciudad Banco with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Ciudad Banco 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Banco Ciudad (A): Who is the Owner, Ciudad Banco 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.
Technology acceleration in Forth Industrial Revolution
– Ciudad Banco has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Ciudad Banco 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.
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. Ciudad Banco needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.
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 Ciudad Banco in the Global Business sector and impact the bottomline of the organization.
Environmental challenges
– Ciudad Banco 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. Ciudad Banco can take advantage of this fund but it will also bring new competitors in the Global Business industry.
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. Ciudad Banco can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing wage structure of Ciudad Banco
– 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 Ciudad Banco.
Consumer confidence and its impact on Ciudad Banco 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.
Stagnating economy with rate increase
– Ciudad Banco 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 Banco Ciudad (A): Who is the Owner 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 Banco Ciudad (A): Who is the Owner 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 Banco Ciudad (A): Who is the Owner 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 Banco Ciudad (A): Who is the Owner 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 Banco Ciudad (A): Who is the Owner 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 Ciudad Banco needs to make to build a sustainable competitive advantage.
