Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version
To maximize their effectiveness, color cases should be printed in color.Mibanco, Peru's leading microfinance bank, faces intense competition as the banking industry rushes into low income segments. Companion video clips bring into the classroom the contemporary reality of a world-class microfinance institution, where the unpaved streets and cluttered markets of the loan officer coexist with the sophistication of technical financial analysis and premier professional management. Rafael Llosa, the General Manager of Mibanco, must find the way to maintain the financial performance of one of Peru's most profitable banks and meet the strategic growth goals set by his board while facing the most aggressive competitive scenario in the 25-year history of microfinance in Peru. Courseware No. 9-309-701, "Microfinance: An Operating Perspective," contains five chapters filmed at Mibanco: Introduction, Competition, Marketing, Operations and Human Relations.
Swot Analysis of "Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version" written by Michael Chu, Gustavo A. Herrero includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Microfinance Mibanco facing as an external strategic factors. Some of the topics covered in Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version case study are - Strategic Management Strategies, Competition, Emerging markets, Entrepreneurial finance, Growth strategy, Marketing and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, digital marketing is dominated by two big players Facebook and Google, competitive advantages are harder to sustain because of technology dispersion, increasing government debt because of Covid-19 spendings, supply chains are disrupted by pandemic , challanges to central banks by blockchain based private currencies, increasing energy prices,
increasing household debt because of falling income levels, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Microfinance Mibanco, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Microfinance Mibanco 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 Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version can be done for the following purposes –
1. Strategic planning using facts provided in Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version case study
2. Improving business portfolio management of Microfinance Mibanco
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 Microfinance Mibanco
Strengths Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Microfinance Mibanco in Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version Harvard Business Review case study are -
Effective Research and Development (R&D)
– Microfinance Mibanco 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 Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Operational resilience
– The operational resilience strategy in the Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Superior customer experience
– The customer experience strategy of Microfinance Mibanco in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Learning organization
- Microfinance Mibanco 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 Microfinance Mibanco is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Microfinance Mibanco is present in almost all the verticals within the industry. This has provided firm in Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Successful track record of launching new products
– Microfinance Mibanco has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Microfinance Mibanco 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.
Innovation driven organization
– Microfinance Mibanco is one of the most innovative firm in sector. Manager in Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Cross disciplinary teams
– Horizontal connected teams at the Microfinance Mibanco 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.
Sustainable margins compare to other players in Leadership & Managing People industry
– Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version firm has clearly differentiated products in the market place. This has enabled Microfinance Mibanco to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Microfinance Mibanco to invest into research and development (R&D) and innovation.
Analytics focus
– Microfinance Mibanco 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 Michael Chu, Gustavo A. Herrero 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.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Microfinance Mibanco digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Microfinance Mibanco 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.
Low bargaining power of suppliers
– Suppliers of Microfinance Mibanco in the sector have low bargaining power. Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Microfinance Mibanco to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version are -
High cash cycle compare to competitors
Microfinance Mibanco 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Microfinance Mibanco 's lucrative customers.
Low market penetration in new markets
– Outside its home market of Microfinance Mibanco, firm in the HBR case study Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Skills based hiring
– The stress on hiring functional specialists at Microfinance Mibanco 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Microfinance Mibanco is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Slow decision making process
– As mentioned earlier in the report, Microfinance Mibanco 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. Microfinance Mibanco 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.
Aligning sales with marketing
– It come across in the case study Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version can leverage the sales team experience to cultivate customer relationships as Microfinance Mibanco is planning to shift buying processes online.
Interest costs
– Compare to the competition, Microfinance Mibanco 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.
Slow to strategic competitive environment developments
– As Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version HBR case study mentions - Microfinance Mibanco 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 bargaining power of channel partners
– Because of the regulatory requirements, Michael Chu, Gustavo A. Herrero suggests that, Microfinance Mibanco 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.
Products dominated business model
– Even though Microfinance Mibanco 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 - Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version should strive to include more intangible value offerings along with its core products and services.
Opportunities Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Microfinance Mibanco is facing challenges because of the dominance of functional experts in the organization. Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Loyalty marketing
– Microfinance Mibanco 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.
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. Microfinance Mibanco 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. Microfinance Mibanco 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Microfinance Mibanco in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Leadership & Managing People segment, and it will provide faster access to the consumers.
Better consumer reach
– The expansion of the 5G network will help Microfinance Mibanco to increase its market reach. Microfinance Mibanco 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 Microfinance Mibanco can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Microfinance Mibanco can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Low interest rates
– Even though inflation is raising its head in most developed economies, Microfinance Mibanco 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.
Building a culture of innovation
– managers at Microfinance Mibanco 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 Leadership & Managing People segment.
Developing new processes and practices
– Microfinance Mibanco 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.
Learning at scale
– Online learning technologies has now opened space for Microfinance Mibanco 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.
Buying journey improvements
– Microfinance Mibanco can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Creating value in data economy
– The success of analytics program of Microfinance Mibanco has opened avenues for new revenue streams for the organization in the industry. This can help Microfinance Mibanco to build a more holistic ecosystem as suggested in the Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version case study. Microfinance Mibanco can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version are -
Technology acceleration in Forth Industrial Revolution
– Microfinance Mibanco has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Microfinance Mibanco needs to keep up with the evolution of technology in the Leadership & Managing People 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version, Microfinance Mibanco 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 .
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Microfinance Mibanco can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version .
Stagnating economy with rate increase
– Microfinance Mibanco 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.
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. Microfinance Mibanco 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.
Consumer confidence and its impact on Microfinance Mibanco 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.
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.
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 Microfinance Mibanco.
High dependence on third party suppliers
– Microfinance Mibanco 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.
Environmental challenges
– Microfinance Mibanco 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. Microfinance Mibanco can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Regulatory challenges
– Microfinance Mibanco 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.
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 Microfinance Mibanco business can come under increasing regulations regarding data privacy, data security, 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.
Weighted SWOT Analysis of Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Mibanco: Meeting the Mainstreaming of Microfinance, Spanish Version is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Microfinance Mibanco needs to make to build a sustainable competitive advantage.