To maximize their effectiveness, color cases should be printed in color.Sykue Bioenergya (Sykue) was formed in April 2006 with the goal of building four 30 megawatt (MW) bioelectricity power plants in Brazil's Bahia province, 1,500 kilometers north of Sao Paulo. Bahia's savannah-like conditions were perfect for growing elephant grass, a biomass with substantial energy-generating potential. In November 2010 the first plant was online and Power Purchasing Agreements (PPAs) had been signed for 27 MW of the 30 MW capacity. Despite this accomplishment, however, the four years between conception and implementation were littered with management setbacks, including lack of capital, an abundance of debt, and increased skepticism among prospective investors and clients about the potential of the project. This case is taught in the HBS executive education Global Agribusiness and Energy executive education seminars. The case is also appropriate for the organizational congruence module of the first-year MBA course Leadership and Organizational Behavior, and second-year MBA electives Innovation Management and Leading Energy Businesses.
Swot Analysis of "Sykue Bioenergya" written by Shon R. Hiatt includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Mw Bioenergya facing as an external strategic factors. Some of the topics covered in Sykue Bioenergya case study are - Strategic Management Strategies, Innovation, Leadership, Organizational structure and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Sykue Bioenergya casestudy better are - – digital marketing is dominated by two big players Facebook and Google, technology disruption, increasing commodity prices, geopolitical disruptions, increasing household debt because of falling income levels, challanges to central banks by blockchain based private currencies, there is backlash against globalization,
central banks are concerned over increasing inflation, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Sykue Bioenergya case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Mw Bioenergya, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Mw Bioenergya 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 Sykue Bioenergya can be done for the following purposes –
1. Strategic planning using facts provided in Sykue Bioenergya case study
2. Improving business portfolio management of Mw Bioenergya
3. Assessing feasibility of the new initiative in Leadership & Managing People field.
4. Making a Leadership & Managing People topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Mw Bioenergya
Strengths Sykue Bioenergya | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Mw Bioenergya in Sykue Bioenergya Harvard Business Review case study are -
High switching costs
– The high switching costs that Mw Bioenergya 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.
Effective Research and Development (R&D)
– Mw Bioenergya 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 Sykue Bioenergya - 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 brand equity
– Mw Bioenergya has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Mw Bioenergya to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Mw Bioenergya digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Mw Bioenergya 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
– Mw Bioenergya 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 Shon R. Hiatt 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.
Training and development
– Mw Bioenergya has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Sykue Bioenergya 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.
Strong track record of project management
– Mw Bioenergya 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
- Mw Bioenergya 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 Mw Bioenergya is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Sykue Bioenergya Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Organizational Resilience of Mw Bioenergya
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Mw Bioenergya does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Diverse revenue streams
– Mw Bioenergya is present in almost all the verticals within the industry. This has provided firm in Sykue Bioenergya 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.
Innovation driven organization
– Mw Bioenergya is one of the most innovative firm in sector. Manager in Sykue Bioenergya Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Low bargaining power of suppliers
– Suppliers of Mw Bioenergya in the sector have low bargaining power. Sykue Bioenergya has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Mw Bioenergya to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses Sykue Bioenergya | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Sykue Bioenergya are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Mw Bioenergya is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Sykue Bioenergya can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Need for greater diversity
– Mw Bioenergya has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Sykue Bioenergya, is just above the industry average. Mw Bioenergya 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.
Increasing silos among functional specialists
– The organizational structure of Mw Bioenergya is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Mw Bioenergya needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Mw Bioenergya to focus more on services rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As Sykue Bioenergya HBR case study mentions - Mw Bioenergya 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Sykue Bioenergya 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 Mw Bioenergya 's lucrative customers.
Interest costs
– Compare to the competition, Mw Bioenergya 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Sykue Bioenergya, in the dynamic environment Mw Bioenergya has struggled to respond to the nimble upstart competition. Mw Bioenergya has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Capital Spending Reduction
– Even during the low interest decade, Mw Bioenergya 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Sykue Bioenergya, it seems that the employees of Mw Bioenergya 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Mw Bioenergya 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.
Opportunities Sykue Bioenergya | 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 Sykue Bioenergya are -
Buying journey improvements
– Mw Bioenergya can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Sykue Bioenergya 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.
Better consumer reach
– The expansion of the 5G network will help Mw Bioenergya to increase its market reach. Mw Bioenergya 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.
Leveraging digital technologies
– Mw Bioenergya 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Mw Bioenergya 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
– Mw Bioenergya 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.
Learning at scale
– Online learning technologies has now opened space for Mw Bioenergya 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.
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 Mw Bioenergya in the consumer business. Now Mw Bioenergya can target international markets with far fewer capital restrictions requirements than the existing system.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Leadership & Managing People industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Mw Bioenergya 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. Mw Bioenergya 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.
Developing new processes and practices
– Mw Bioenergya can develop new processes and procedures in Leadership & Managing People 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.
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 Mw Bioenergya 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Mw Bioenergya can use these opportunities to build new business models that can help the communities that Mw Bioenergya operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
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. Mw Bioenergya can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Creating value in data economy
– The success of analytics program of Mw Bioenergya has opened avenues for new revenue streams for the organization in the industry. This can help Mw Bioenergya to build a more holistic ecosystem as suggested in the Sykue Bioenergya case study. Mw Bioenergya can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats Sykue Bioenergya External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Sykue Bioenergya are -
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 Mw Bioenergya in the Leadership & Managing People sector and impact the bottomline of the organization.
Shortening product life cycle
– it is one of the major threat that Mw Bioenergya is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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.
Environmental challenges
– Mw Bioenergya 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. Mw Bioenergya can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Increasing wage structure of Mw Bioenergya
– 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 Mw Bioenergya.
Stagnating economy with rate increase
– Mw Bioenergya 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.
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. Mw Bioenergya needs to understand the core reasons impacting the Leadership & Managing People 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 Sykue Bioenergya, Mw Bioenergya may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Leadership & Managing People .
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.
Easy access to finance
– Easy access to finance in Leadership & Managing People field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Mw Bioenergya can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Mw Bioenergya in the Leadership & Managing People industry. The Leadership & Managing People 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.
High dependence on third party suppliers
– Mw Bioenergya 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.
Regulatory challenges
– Mw Bioenergya 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 Leadership & Managing People industry regulations.
Weighted SWOT Analysis of Sykue Bioenergya 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 Sykue Bioenergya 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 Sykue Bioenergya 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 Sykue Bioenergya 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 Sykue Bioenergya 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 Mw Bioenergya needs to make to build a sustainable competitive advantage.
