Swot Analysis of "Parmalat Uruguay A&B (Video Supplement)" written by Jim Sharpe includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Parmalat Uruguay facing as an external strategic factors. Some of the topics covered in Parmalat Uruguay A&B (Video Supplement) case study are - Strategic Management Strategies, Crisis management, Developing employees, Entrepreneurship, Financial management, Government, International business, Mergers & acquisitions, Negotiations, Operations management, Organizational culture, Reorganization and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Parmalat Uruguay A&B (Video Supplement) casestudy better are - – competitive advantages are harder to sustain because of technology dispersion, increasing inequality as vast percentage of new income is going to the top 1%, technology disruption, there is backlash against globalization, digital marketing is dominated by two big players Facebook and Google, wage bills are increasing, increasing household debt because of falling income levels,
challanges to central banks by blockchain based private currencies, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Parmalat Uruguay A&B (Video Supplement)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Parmalat Uruguay A&B (Video Supplement) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Parmalat Uruguay, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Parmalat Uruguay 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 Parmalat Uruguay A&B (Video Supplement) can be done for the following purposes –
1. Strategic planning using facts provided in Parmalat Uruguay A&B (Video Supplement) case study
2. Improving business portfolio management of Parmalat Uruguay
3. Assessing feasibility of the new initiative in Innovation & Entrepreneurship field.
4. Making a Innovation & Entrepreneurship topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Parmalat Uruguay
Strengths Parmalat Uruguay A&B (Video Supplement) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Parmalat Uruguay in Parmalat Uruguay A&B (Video Supplement) Harvard Business Review case study are -
Ability to lead change in Innovation & Entrepreneurship field
– Parmalat Uruguay 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 Parmalat Uruguay in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Operational resilience
– The operational resilience strategy in the Parmalat Uruguay A&B (Video Supplement) 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.
High brand equity
– Parmalat Uruguay has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Parmalat Uruguay to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– Parmalat Uruguay is one of the most innovative firm in sector. Manager in Parmalat Uruguay A&B (Video Supplement) 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)
– Parmalat Uruguay 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 Parmalat Uruguay A&B (Video Supplement) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High switching costs
– The high switching costs that Parmalat Uruguay 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.
Strong track record of project management
– Parmalat Uruguay is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Learning organization
- Parmalat Uruguay 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 Parmalat Uruguay is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Parmalat Uruguay A&B (Video Supplement) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Analytics focus
– Parmalat Uruguay 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 Jim Sharpe 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.
Superior customer experience
– The customer experience strategy of Parmalat Uruguay in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– Parmalat Uruguay has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Parmalat Uruguay A&B (Video Supplement) 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.
Low bargaining power of suppliers
– Suppliers of Parmalat Uruguay in the sector have low bargaining power. Parmalat Uruguay A&B (Video Supplement) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Parmalat Uruguay to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses Parmalat Uruguay A&B (Video Supplement) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Parmalat Uruguay A&B (Video Supplement) are -
Slow decision making process
– As mentioned earlier in the report, Parmalat Uruguay 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. Parmalat Uruguay 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.
Interest costs
– Compare to the competition, Parmalat Uruguay 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Parmalat Uruguay A&B (Video Supplement), is just above the industry average. Parmalat Uruguay 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Parmalat Uruguay A&B (Video Supplement), it seems that the employees of Parmalat Uruguay 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 Parmalat Uruguay A&B (Video Supplement), it seems that company is thinking about the frontier risks that can impact Innovation & Entrepreneurship 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, Parmalat Uruguay is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Parmalat Uruguay A&B (Video Supplement) 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, Jim Sharpe suggests that, Parmalat Uruguay 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.
Increasing silos among functional specialists
– The organizational structure of Parmalat Uruguay is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Parmalat Uruguay needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Parmalat Uruguay to focus more on services rather than just following the product oriented approach.
High operating costs
– Compare to the competitors, firm in the HBR case study Parmalat Uruguay A&B (Video Supplement) 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 Parmalat Uruguay 's lucrative customers.
Aligning sales with marketing
– It come across in the case study Parmalat Uruguay A&B (Video Supplement) 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 Parmalat Uruguay A&B (Video Supplement) can leverage the sales team experience to cultivate customer relationships as Parmalat Uruguay is planning to shift buying processes online.
High cash cycle compare to competitors
Parmalat Uruguay 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.
Opportunities Parmalat Uruguay A&B (Video Supplement) | 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 Parmalat Uruguay A&B (Video Supplement) are -
Learning at scale
– Online learning technologies has now opened space for Parmalat Uruguay 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Parmalat Uruguay is facing challenges because of the dominance of functional experts in the organization. Parmalat Uruguay A&B (Video Supplement) 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.
Using analytics as competitive advantage
– Parmalat Uruguay 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 Parmalat Uruguay A&B (Video Supplement) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Parmalat Uruguay to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Low interest rates
– Even though inflation is raising its head in most developed economies, Parmalat Uruguay 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.
Better consumer reach
– The expansion of the 5G network will help Parmalat Uruguay to increase its market reach. Parmalat Uruguay 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Parmalat Uruguay can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Developing new processes and practices
– Parmalat Uruguay can develop new processes and procedures in Innovation & Entrepreneurship 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.
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 Parmalat Uruguay in the consumer business. Now Parmalat Uruguay can target international markets with far fewer capital restrictions requirements than the existing system.
Leveraging digital technologies
– Parmalat Uruguay 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Innovation & Entrepreneurship industry, but it has also influenced the consumer preferences. Parmalat Uruguay can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Creating value in data economy
– The success of analytics program of Parmalat Uruguay has opened avenues for new revenue streams for the organization in the industry. This can help Parmalat Uruguay to build a more holistic ecosystem as suggested in the Parmalat Uruguay A&B (Video Supplement) case study. Parmalat Uruguay can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Parmalat Uruguay in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Innovation & Entrepreneurship 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, Parmalat Uruguay can use these opportunities to build new business models that can help the communities that Parmalat Uruguay operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Threats Parmalat Uruguay A&B (Video Supplement) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Parmalat Uruguay A&B (Video Supplement) are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Parmalat Uruguay in the Innovation & Entrepreneurship industry. The Innovation & Entrepreneurship 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.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Parmalat Uruguay with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Easy access to finance
– Easy access to finance in Innovation & Entrepreneurship field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Parmalat Uruguay can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Stagnating economy with rate increase
– Parmalat Uruguay 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.
Environmental challenges
– Parmalat Uruguay 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. Parmalat Uruguay can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Parmalat Uruguay A&B (Video Supplement), Parmalat Uruguay may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Innovation & Entrepreneurship .
Consumer confidence and its impact on Parmalat Uruguay 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.
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. Parmalat Uruguay 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.
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 Parmalat Uruguay in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
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 Parmalat Uruguay.
Shortening product life cycle
– it is one of the major threat that Parmalat Uruguay is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Parmalat Uruguay A&B (Video Supplement) 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 Parmalat Uruguay A&B (Video Supplement) 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 Parmalat Uruguay A&B (Video Supplement) 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 Parmalat Uruguay A&B (Video Supplement) 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 Parmalat Uruguay A&B (Video Supplement) 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 Parmalat Uruguay needs to make to build a sustainable competitive advantage.
