Grupo ABC and Nizan Guanaes's Path from Brazil to the World SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Grupo ABC and Nizan Guanaes's Path from Brazil to the World
Internationally recognized Brazilian Nizan Guanaes, co-founder of Grupo ABC, a rapidly growing global advertising firm ranked 18th in 2011, had aspirations to be in the top 10 by 2015. Grupo ABC thrived by identifying national (Brazilian) challenges and incorporating them in creative messages. Guanaes steered the group toward thinking big while acting locally, tackling societal challenges and building partnerships, as he entered the world stage; serving as an informal ambassador for Brazil; playing important roles in international forums as the Clinton Global Initiative, UNESCO, and the Cannes Lions Advertising Festival. Guanaes needed to determine the best growth strategy, how to seize opportunities, and/or how to adapt to meet his ambitious goal.
Authors :: Rosabeth Moss Kanter, Gustavo A. Herrero, Ricardo Reisen de Pinho
Swot Analysis of "Grupo ABC and Nizan Guanaes's Path from Brazil to the World" written by Rosabeth Moss Kanter, Gustavo A. Herrero, Ricardo Reisen de Pinho includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Guanaes Grupo facing as an external strategic factors. Some of the topics covered in Grupo ABC and Nizan Guanaes's Path from Brazil to the World case study are - Strategic Management Strategies, Entrepreneurship, International business, Marketing, Recession, Strategy execution and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Grupo ABC and Nizan Guanaes's Path from Brazil to the World casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies, competitive advantages are harder to sustain because of technology dispersion, increasing energy prices, increasing commodity prices,
talent flight as more people leaving formal jobs, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
Introduction to SWOT Analysis of Grupo ABC and Nizan Guanaes's Path from Brazil to the World
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Grupo ABC and Nizan Guanaes's Path from Brazil to the World case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Guanaes Grupo, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Guanaes Grupo 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 Grupo ABC and Nizan Guanaes's Path from Brazil to the World can be done for the following purposes –
1. Strategic planning using facts provided in Grupo ABC and Nizan Guanaes's Path from Brazil to the World case study
2. Improving business portfolio management of Guanaes Grupo
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 Guanaes Grupo
Strengths Grupo ABC and Nizan Guanaes's Path from Brazil to the World | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Guanaes Grupo in Grupo ABC and Nizan Guanaes's Path from Brazil to the World Harvard Business Review case study are -
Superior customer experience
– The customer experience strategy of Guanaes Grupo in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to recruit top talent
– Guanaes Grupo is one of the leading recruiters in the industry. Managers in the Grupo ABC and Nizan Guanaes's Path from Brazil to the World are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Analytics focus
– Guanaes Grupo 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 Rosabeth Moss Kanter, Gustavo A. Herrero, Ricardo Reisen de Pinho 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.
Organizational Resilience of Guanaes Grupo
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Guanaes Grupo does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High brand equity
– Guanaes Grupo has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Guanaes Grupo to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of Guanaes Grupo in the sector have low bargaining power. Grupo ABC and Nizan Guanaes's Path from Brazil to the World has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Guanaes Grupo to manage not only supply disruptions but also source products at highly competitive prices.
Ability to lead change in Leadership & Managing People field
– Guanaes Grupo 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 Guanaes Grupo in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Innovation driven organization
– Guanaes Grupo is one of the most innovative firm in sector. Manager in Grupo ABC and Nizan Guanaes's Path from Brazil to the World Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Operational resilience
– The operational resilience strategy in the Grupo ABC and Nizan Guanaes's Path from Brazil to the World 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.
Strong track record of project management
– Guanaes Grupo is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Successful track record of launching new products
– Guanaes Grupo has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Guanaes Grupo 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.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Guanaes Grupo digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Guanaes Grupo 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.
Weaknesses Grupo ABC and Nizan Guanaes's Path from Brazil to the World | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Grupo ABC and Nizan Guanaes's Path from Brazil to the World are -
Increasing silos among functional specialists
– The organizational structure of Guanaes Grupo is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Guanaes Grupo needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Guanaes Grupo to focus more on services rather than just following the product oriented approach.
Workers concerns about automation
– As automation is fast increasing in the segment, Guanaes Grupo 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.
Skills based hiring
– The stress on hiring functional specialists at Guanaes Grupo has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Grupo ABC and Nizan Guanaes's Path from Brazil to the World, is just above the industry average. Guanaes Grupo 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.
Interest costs
– Compare to the competition, Guanaes Grupo 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.
Low market penetration in new markets
– Outside its home market of Guanaes Grupo, firm in the HBR case study Grupo ABC and Nizan Guanaes's Path from Brazil to the World needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Need for greater diversity
– Guanaes Grupo 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Rosabeth Moss Kanter, Gustavo A. Herrero, Ricardo Reisen de Pinho suggests that, Guanaes Grupo 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.
Slow to strategic competitive environment developments
– As Grupo ABC and Nizan Guanaes's Path from Brazil to the World HBR case study mentions - Guanaes Grupo 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.
No frontier risks strategy
– After analyzing the HBR case study Grupo ABC and Nizan Guanaes's Path from Brazil to the World, it seems that company is thinking about the frontier risks that can impact Leadership & Managing People 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 decision making process
– As mentioned earlier in the report, Guanaes Grupo 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. Guanaes Grupo 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.
Opportunities Grupo ABC and Nizan Guanaes's Path from Brazil to the World | 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 Grupo ABC and Nizan Guanaes's Path from Brazil to the World are -
Leveraging digital technologies
– Guanaes Grupo 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.
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. Guanaes Grupo 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 Guanaes Grupo has opened avenues for new revenue streams for the organization in the industry. This can help Guanaes Grupo to build a more holistic ecosystem as suggested in the Grupo ABC and Nizan Guanaes's Path from Brazil to the World case study. Guanaes Grupo can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Guanaes Grupo is facing challenges because of the dominance of functional experts in the organization. Grupo ABC and Nizan Guanaes's Path from Brazil to the World 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
– Guanaes Grupo 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.
Buying journey improvements
– Guanaes Grupo can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Grupo ABC and Nizan Guanaes's Path from Brazil to the World 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Leadership & Managing People industry, but it has also influenced the consumer preferences. Guanaes Grupo can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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 Guanaes Grupo in the consumer business. Now Guanaes Grupo can target international markets with far fewer capital restrictions requirements than the existing system.
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 Guanaes Grupo 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Guanaes Grupo 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Guanaes Grupo to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Guanaes Grupo to hire the very best people irrespective of their geographical location.
Manufacturing automation
– Guanaes Grupo can use the latest technology developments to improve its manufacturing and designing process in Leadership & Managing People 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.
Better consumer reach
– The expansion of the 5G network will help Guanaes Grupo to increase its market reach. Guanaes Grupo 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.
Threats Grupo ABC and Nizan Guanaes's Path from Brazil to the World External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Grupo ABC and Nizan Guanaes's Path from Brazil to the World are -
High dependence on third party suppliers
– Guanaes Grupo high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Guanaes Grupo 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.
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.
Regulatory challenges
– Guanaes Grupo 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.
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.
Technology acceleration in Forth Industrial Revolution
– Guanaes Grupo has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Guanaes Grupo 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.
Stagnating economy with rate increase
– Guanaes Grupo 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Guanaes Grupo 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.
Increasing wage structure of Guanaes Grupo
– 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 Guanaes Grupo.
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 Guanaes Grupo.
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. Guanaes Grupo can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Guanaes Grupo 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 Guanaes Grupo is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Grupo ABC and Nizan Guanaes's Path from Brazil to the World 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 Grupo ABC and Nizan Guanaes's Path from Brazil to the World 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 Grupo ABC and Nizan Guanaes's Path from Brazil to the World 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 Grupo ABC and Nizan Guanaes's Path from Brazil to the World 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 Grupo ABC and Nizan Guanaes's Path from Brazil to the World 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 Guanaes Grupo needs to make to build a sustainable competitive advantage.
