Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

Case Study SWOT Analysis Solution

Case Study Description of Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico

When the Mexican Congress approved the country's 2007 budget, it included an appropriation of 8.5 billion pesos allocated to provide non-contributive pensions to senior citizens. President Felipe Calderon wanted to introduce eligibility criteria that would ensure the new federally-funded pensions would go to poor seniors that would otherwise lack the means to sustain themselves. This case puts the reader in the shoes of Calderon's advisor, asking them to assess which targeting option would be best for the Mexican government, taking into account a wide range of criteria including targeting efficiency, financial feasibility, political viability, and administrative feasibility. The case provides a brief description of previous efforts to target the poor in Mexican social programs and data to evaluate three potential targeting options. Case Number 2011.0

Authors :: Dan Levy, Jorge Coarasa

Topics :: Leadership & Managing People

Tags :: Economy, Policy, Social enterprise, Social responsibility, SWOT Analysis, SWOT Matrix, TOWS, Weighted SWOT Analysis

Swot Analysis of "Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico" written by Dan Levy, Jorge Coarasa includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Pensions Targeting facing as an external strategic factors. Some of the topics covered in Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico case study are - Strategic Management Strategies, Economy, Policy, Social enterprise, Social responsibility and Leadership & Managing People.

Some of the macro environment factors that can be used to understand the Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico casestudy better are - – supply chains are disrupted by pandemic , there is increasing trade war between United States & China, customer relationship management is fast transforming because of increasing concerns over data privacy, there is backlash against globalization, increasing inequality as vast percentage of new income is going to the top 1%, increasing government debt because of Covid-19 spendings, technology disruption, increasing transportation and logistics costs, banking and financial system is disrupted by Bitcoin and other crypto currencies, etc

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Introduction to SWOT Analysis of Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Pensions Targeting, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Pensions Targeting 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico can be done for the following purposes –
1. Strategic planning using facts provided in Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico case study
2. Improving business portfolio management of Pensions Targeting
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 Pensions Targeting

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Strengths Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Pensions Targeting in Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico Harvard Business Review case study are -

Training and development

– Pensions Targeting has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico 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.

Effective Research and Development (R&D)

– Pensions Targeting 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 Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

High switching costs

– The high switching costs that Pensions Targeting has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.

Innovation driven organization

– Pensions Targeting is one of the most innovative firm in sector. Manager in Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.

Digital Transformation in Leadership & Managing People segment

- digital transformation varies from industry to industry. For Pensions Targeting digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Pensions Targeting 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.

Operational resilience

– The operational resilience strategy in the Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico 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 Pensions Targeting in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Analytics focus

– Pensions Targeting 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 Dan Levy, Jorge Coarasa 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.

Cross disciplinary teams

– Horizontal connected teams at the Pensions Targeting 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.

Ability to recruit top talent

– Pensions Targeting is one of the leading recruiters in the industry. Managers in the Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.

Learning organization

- Pensions Targeting 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 Pensions Targeting is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico Harvard Business Review case study emphasize – knowledge, initiative, and innovation.

Low bargaining power of suppliers

– Suppliers of Pensions Targeting in the sector have low bargaining power. Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Pensions Targeting to manage not only supply disruptions but also source products at highly competitive prices.

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Weaknesses Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico are -

Capital Spending Reduction

– Even during the low interest decade, Pensions Targeting has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.

High bargaining power of channel partners

– Because of the regulatory requirements, Dan Levy, Jorge Coarasa suggests that, Pensions Targeting 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.

Skills based hiring

– The stress on hiring functional specialists at Pensions Targeting 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.

Low market penetration in new markets

– Outside its home market of Pensions Targeting, firm in the HBR case study Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.

Slow to strategic competitive environment developments

– As Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico HBR case study mentions - Pensions Targeting 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 dependence on existing supply chain

– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Pensions Targeting supply chain. Even after few cautionary changes mentioned in the HBR case study - Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Pensions Targeting vulnerable to further global disruptions in South East Asia.

High dependence on star products

– The top 2 products and services of the firm as mentioned in the Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico 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 Pensions Targeting has relatively successful track record of launching new products.

Need for greater diversity

– Pensions Targeting 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.

Lack of clear differentiation of Pensions Targeting products

– To increase the profitability and margins on the products, Pensions Targeting needs to provide more differentiated products than what it is currently offering in the marketplace.

High operating costs

– Compare to the competitors, firm in the HBR case study Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico 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 Pensions Targeting 's lucrative customers.

Workers concerns about automation

– As automation is fast increasing in the segment, Pensions Targeting 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.

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Opportunities Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico | 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 Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico are -

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects Pensions Targeting can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

Developing new processes and practices

– Pensions Targeting 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.

Lowering marketing communication costs

– 5G expansion will open new opportunities for Pensions Targeting 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.

Loyalty marketing

– Pensions Targeting 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.

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. Pensions Targeting can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

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. Pensions Targeting 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. Pensions Targeting 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.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Pensions Targeting 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 Pensions Targeting to hire the very best people irrespective of their geographical location.

Learning at scale

– Online learning technologies has now opened space for Pensions Targeting 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.

Better consumer reach

– The expansion of the 5G network will help Pensions Targeting to increase its market reach. Pensions Targeting 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.

Low interest rates

– Even though inflation is raising its head in most developed economies, Pensions Targeting 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.

Leveraging digital technologies

– Pensions Targeting 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.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Pensions Targeting can use these opportunities to build new business models that can help the communities that Pensions Targeting operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.

Redefining models of collaboration and team work

– As explained in the weaknesses section, Pensions Targeting is facing challenges because of the dominance of functional experts in the organization. Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico 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.

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Threats Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats mentioned in the HBR case study Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico are -

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico, Pensions Targeting 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 .

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. Pensions Targeting 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.

Regulatory challenges

– Pensions Targeting 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.

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 Pensions Targeting.

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.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Pensions Targeting with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.

Consumer confidence and its impact on Pensions Targeting 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.

Environmental challenges

– Pensions Targeting 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. Pensions Targeting can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.

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 Pensions Targeting in the Leadership & Managing People sector and impact the bottomline of the organization.

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 Pensions Targeting business can come under increasing regulations regarding data privacy, data security, etc.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Pensions Targeting 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.

Technology acceleration in Forth Industrial Revolution

– Pensions Targeting has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Pensions Targeting 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.

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. Pensions Targeting needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.

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Weighted SWOT Analysis of Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico 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 Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico 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 Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico 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 Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico 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 Providing Pensions for the Poor: Targeting Cash Transfers for the Elderly in Mexico 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 Pensions Targeting needs to make to build a sustainable competitive advantage.

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