MTN and the Nigerian Fine SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of MTN and the Nigerian Fine
In late 2015, South African telecommunications giant MTN was fined US$5.2 billion by the Nigerian authorities for a mass of improperly registered subscribers-the largest fine of its kind ever imposed in the industry anywhere in the world. MTN was an emerging-market multinational corporation with a track record of successfully operating in some of the toughest, riskiest emerging markets. Thus, it was surprising that MTN had been unable to avoid a fine of this magnitude. Three factors had preceded the fine and changed the business environment in Nigeria leading up to 2015: the first was the war against the Boko Haram movement in Nigeria, which led security forces to demand the registration of prepaid phone cards; the second was the economic crisis caused by the impact of falling oil prices; and the third factor was a change in government. In light of these political risks and government regulations, how could MTN recover and move forward from this difficult situation?
Swot Analysis of "MTN and the Nigerian Fine" written by Albert Wocke, Paul W. Beamish includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Mtn Fine facing as an external strategic factors. Some of the topics covered in MTN and the Nigerian Fine case study are - Strategic Management Strategies, Government, Risk management and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the MTN and the Nigerian Fine casestudy better are - – increasing commodity prices, increasing energy prices, increasing government debt because of Covid-19 spendings, wage bills are increasing, increasing inequality as vast percentage of new income is going to the top 1%, challanges to central banks by blockchain based private currencies, central banks are concerned over increasing inflation,
increasing household debt because of falling income levels, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of MTN and the Nigerian Fine
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in MTN and the Nigerian Fine case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Mtn Fine, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Mtn Fine 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 MTN and the Nigerian Fine can be done for the following purposes –
1. Strategic planning using facts provided in MTN and the Nigerian Fine case study
2. Improving business portfolio management of Mtn Fine
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 Mtn Fine
Strengths MTN and the Nigerian Fine | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Mtn Fine in MTN and the Nigerian Fine Harvard Business Review case study are -
Analytics focus
– Mtn Fine 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 Albert Wocke, Paul W. Beamish 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.
Ability to lead change in Leadership & Managing People field
– Mtn Fine 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 Mtn Fine in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Effective Research and Development (R&D)
– Mtn Fine 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 MTN and the Nigerian Fine - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Cross disciplinary teams
– Horizontal connected teams at the Mtn Fine 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.
Operational resilience
– The operational resilience strategy in the MTN and the Nigerian Fine 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.
Sustainable margins compare to other players in Leadership & Managing People industry
– MTN and the Nigerian Fine firm has clearly differentiated products in the market place. This has enabled Mtn Fine to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Mtn Fine to invest into research and development (R&D) and innovation.
Innovation driven organization
– Mtn Fine is one of the most innovative firm in sector. Manager in MTN and the Nigerian Fine 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 Mtn Fine in the sector have low bargaining power. MTN and the Nigerian Fine has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Mtn Fine to manage not only supply disruptions but also source products at highly competitive prices.
Training and development
– Mtn Fine has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in MTN and the Nigerian Fine 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.
Highly skilled collaborators
– Mtn Fine 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 MTN and the Nigerian Fine HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Learning organization
- Mtn Fine 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 Mtn Fine is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in MTN and the Nigerian Fine Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Mtn Fine digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Mtn Fine 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 MTN and the Nigerian Fine | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of MTN and the Nigerian Fine are -
Need for greater diversity
– Mtn Fine 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 cash cycle compare to competitors
Mtn Fine 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.
Skills based hiring
– The stress on hiring functional specialists at Mtn Fine 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, Mtn Fine is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study MTN and the Nigerian Fine can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Low market penetration in new markets
– Outside its home market of Mtn Fine, firm in the HBR case study MTN and the Nigerian Fine needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study MTN and the Nigerian Fine, in the dynamic environment Mtn Fine has struggled to respond to the nimble upstart competition. Mtn Fine has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Workers concerns about automation
– As automation is fast increasing in the segment, Mtn Fine 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.
Increasing silos among functional specialists
– The organizational structure of Mtn Fine is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Mtn Fine needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Mtn Fine to focus more on services rather than just following the product oriented approach.
Slow decision making process
– As mentioned earlier in the report, Mtn Fine 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. Mtn Fine 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study MTN and the Nigerian Fine, is just above the industry average. Mtn Fine 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, Mtn Fine 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.
Opportunities MTN and the Nigerian Fine | 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 MTN and the Nigerian Fine are -
Better consumer reach
– The expansion of the 5G network will help Mtn Fine to increase its market reach. Mtn Fine 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Mtn Fine 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 Mtn Fine to hire the very best people irrespective of their geographical location.
Creating value in data economy
– The success of analytics program of Mtn Fine has opened avenues for new revenue streams for the organization in the industry. This can help Mtn Fine to build a more holistic ecosystem as suggested in the MTN and the Nigerian Fine case study. Mtn Fine can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Loyalty marketing
– Mtn Fine 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. Mtn Fine 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. Mtn Fine 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.
Leveraging digital technologies
– Mtn Fine 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.
Using analytics as competitive advantage
– Mtn Fine 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 MTN and the Nigerian Fine - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Mtn Fine to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Mtn Fine is facing challenges because of the dominance of functional experts in the organization. MTN and the Nigerian Fine 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Mtn Fine 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Mtn Fine can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Mtn Fine 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, MTN and the Nigerian Fine, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Building a culture of innovation
– managers at Mtn Fine 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Mtn Fine can use these opportunities to build new business models that can help the communities that Mtn Fine operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Threats MTN and the Nigerian Fine External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study MTN and the Nigerian Fine are -
Stagnating economy with rate increase
– Mtn Fine 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Mtn Fine with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Mtn Fine needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Consumer confidence and its impact on Mtn Fine 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.
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 Mtn Fine in the Leadership & Managing People sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Mtn Fine 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.
Technology acceleration in Forth Industrial Revolution
– Mtn Fine has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Mtn Fine 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.
Increasing wage structure of Mtn Fine
– 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 Mtn Fine.
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. Mtn Fine 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.
Shortening product life cycle
– it is one of the major threat that Mtn Fine is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Environmental challenges
– Mtn Fine 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. Mtn Fine can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Mtn Fine 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.
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 Mtn Fine business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of MTN and the Nigerian Fine 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 MTN and the Nigerian Fine 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 MTN and the Nigerian Fine 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 MTN and the Nigerian Fine 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 MTN and the Nigerian Fine 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 Mtn Fine needs to make to build a sustainable competitive advantage.