Swot Analysis of "Grupo ASSA, S.A. (B)" written by Anne Donnellon, Jeffry A. Timmons, Sue Mundell includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Assa Grupo facing as an external strategic factors. Some of the topics covered in Grupo ASSA, S.A. (B) case study are - Strategic Management Strategies, Conflict, Financial management, Mergers & acquisitions, Negotiations, Venture capital and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Grupo ASSA, S.A. (B) casestudy better are - – increasing commodity prices, wage bills are increasing, increasing transportation and logistics costs, banking and financial system is disrupted by Bitcoin and other crypto currencies, geopolitical disruptions, talent flight as more people leaving formal jobs, central banks are concerned over increasing inflation,
customer relationship management is fast transforming because of increasing concerns over data privacy, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Grupo ASSA, S.A. (B)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Grupo ASSA, S.A. (B) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Assa Grupo, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Assa 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 ASSA, S.A. (B) can be done for the following purposes –
1. Strategic planning using facts provided in Grupo ASSA, S.A. (B) case study
2. Improving business portfolio management of Assa 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 Assa Grupo
Strengths Grupo ASSA, S.A. (B) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Assa Grupo in Grupo ASSA, S.A. (B) Harvard Business Review case study are -
Highly skilled collaborators
– Assa Grupo has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Grupo ASSA, S.A. (B) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High brand equity
– Assa Grupo has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Assa Grupo to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Superior customer experience
– The customer experience strategy of Assa Grupo in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Low bargaining power of suppliers
– Suppliers of Assa Grupo in the sector have low bargaining power. Grupo ASSA, S.A. (B) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Assa Grupo to manage not only supply disruptions but also source products at highly competitive prices.
Learning organization
- Assa Grupo 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 Assa Grupo is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Grupo ASSA, S.A. (B) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in Leadership & Managing People industry
– Grupo ASSA, S.A. (B) firm has clearly differentiated products in the market place. This has enabled Assa Grupo to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Assa Grupo to invest into research and development (R&D) and innovation.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Assa Grupo digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Assa 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.
Effective Research and Development (R&D)
– Assa Grupo 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 Grupo ASSA, S.A. (B) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Strong track record of project management
– Assa 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.
Diverse revenue streams
– Assa Grupo is present in almost all the verticals within the industry. This has provided firm in Grupo ASSA, S.A. (B) 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
– Assa Grupo has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Assa 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.
Operational resilience
– The operational resilience strategy in the Grupo ASSA, S.A. (B) 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.
Weaknesses Grupo ASSA, S.A. (B) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Grupo ASSA, S.A. (B) are -
No frontier risks strategy
– After analyzing the HBR case study Grupo ASSA, S.A. (B), 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.
Interest costs
– Compare to the competition, Assa 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.
Products dominated business model
– Even though Assa Grupo 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 - Grupo ASSA, S.A. (B) should strive to include more intangible value offerings along with its core products and services.
Low market penetration in new markets
– Outside its home market of Assa Grupo, firm in the HBR case study Grupo ASSA, S.A. (B) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High operating costs
– Compare to the competitors, firm in the HBR case study Grupo ASSA, S.A. (B) 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 Assa Grupo 's lucrative customers.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Grupo ASSA, S.A. (B), it seems that the employees of Assa Grupo 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Grupo ASSA, S.A. (B) HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Assa Grupo has relatively successful track record of launching new products.
High cash cycle compare to competitors
Assa Grupo 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.
Increasing silos among functional specialists
– The organizational structure of Assa Grupo is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Assa Grupo needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Assa Grupo to focus more on services rather than just following the product oriented approach.
Skills based hiring
– The stress on hiring functional specialists at Assa 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.
Aligning sales with marketing
– It come across in the case study Grupo ASSA, S.A. (B) 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 Grupo ASSA, S.A. (B) can leverage the sales team experience to cultivate customer relationships as Assa Grupo is planning to shift buying processes online.
Opportunities Grupo ASSA, S.A. (B) | 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 ASSA, S.A. (B) are -
Learning at scale
– Online learning technologies has now opened space for Assa Grupo 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Assa Grupo can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Grupo ASSA, S.A. (B), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Manufacturing automation
– Assa 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Assa 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.
Buying journey improvements
– Assa Grupo can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Grupo ASSA, S.A. (B) 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.
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. Assa Grupo can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 Assa 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.
Creating value in data economy
– The success of analytics program of Assa Grupo has opened avenues for new revenue streams for the organization in the industry. This can help Assa Grupo to build a more holistic ecosystem as suggested in the Grupo ASSA, S.A. (B) case study. Assa Grupo can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– Assa Grupo 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 Grupo ASSA, S.A. (B) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Assa Grupo 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, Assa Grupo 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.
Developing new processes and practices
– Assa Grupo 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.
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 Assa Grupo in the consumer business. Now Assa Grupo can target international markets with far fewer capital restrictions requirements than the existing system.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Assa Grupo can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Grupo ASSA, S.A. (B) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Grupo ASSA, S.A. (B) are -
Technology acceleration in Forth Industrial Revolution
– Assa 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, Assa 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.
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. Assa 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.
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 Assa Grupo in the Leadership & Managing People sector and impact the bottomline of the organization.
Regulatory challenges
– Assa 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.
Increasing wage structure of Assa 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 Assa Grupo.
Consumer confidence and its impact on Assa Grupo demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Stagnating economy with rate increase
– Assa 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.
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.
Environmental challenges
– Assa Grupo 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. Assa Grupo can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Assa Grupo with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Assa 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.
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. Assa Grupo needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Weighted SWOT Analysis of Grupo ASSA, S.A. (B) 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 ASSA, S.A. (B) 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 ASSA, S.A. (B) 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 ASSA, S.A. (B) 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 ASSA, S.A. (B) 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 Assa Grupo needs to make to build a sustainable competitive advantage.
