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 - – there is backlash against globalization, challanges to central banks by blockchain based private currencies, supply chains are disrupted by pandemic , wage bills are increasing, there is increasing trade war between United States & China, increasing transportation and logistics costs, competitive advantages are harder to sustain because of technology dispersion,
talent flight as more people leaving formal jobs, geopolitical disruptions, 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.
Effective Research and Development (R&D)
– Guanaes 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 ABC and Nizan Guanaes's Path from Brazil to the World - 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 Guanaes Grupo 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.
Diverse revenue streams
– Guanaes Grupo is present in almost all the verticals within the industry. This has provided firm in Grupo ABC and Nizan Guanaes's Path from Brazil to the World 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.
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.
Learning organization
- Guanaes 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 Guanaes Grupo is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Grupo ABC and Nizan Guanaes's Path from Brazil to the World Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
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.
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.
Highly skilled collaborators
– Guanaes 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 ABC and Nizan Guanaes's Path from Brazil to the World HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
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.
Cross disciplinary teams
– Horizontal connected teams at the Guanaes Grupo 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.
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 -
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.
Capital Spending Reduction
– Even during the low interest decade, Guanaes Grupo 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 cash cycle compare to competitors
Guanaes 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 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.
Lack of clear differentiation of Guanaes Grupo products
– To increase the profitability and margins on the products, Guanaes Grupo needs to provide more differentiated products than what it is currently offering in the marketplace.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Grupo ABC and Nizan Guanaes's Path from Brazil to the World 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 Guanaes Grupo has relatively successful track record of launching new products.
High operating costs
– Compare to the competitors, firm in the HBR case study Grupo ABC and Nizan Guanaes's Path from Brazil to the World 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 Guanaes Grupo 's lucrative customers.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Grupo ABC and Nizan Guanaes's Path from Brazil to the World, it seems that the employees of Guanaes 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.
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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Grupo ABC and Nizan Guanaes's Path from Brazil to the World, in the dynamic environment Guanaes Grupo has struggled to respond to the nimble upstart competition. Guanaes Grupo has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
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 Guanaes Grupo supply chain. Even after few cautionary changes mentioned in the HBR case study - Grupo ABC and Nizan Guanaes's Path from Brazil to the World, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Guanaes Grupo vulnerable to further global disruptions in South East Asia.
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 -
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.
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.
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.
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.
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.
Developing new processes and practices
– Guanaes 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.
Learning at scale
– Online learning technologies has now opened space for Guanaes 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.
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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Guanaes 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 ABC and Nizan Guanaes's Path from Brazil to the World, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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.
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.
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.
Building a culture of innovation
– managers at Guanaes Grupo 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.
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 -
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.
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.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Guanaes Grupo with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Grupo ABC and Nizan Guanaes's Path from Brazil to the World, Guanaes Grupo 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 .
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 Guanaes Grupo business can come under increasing regulations regarding data privacy, data security, etc.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
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.
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.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Guanaes Grupo.
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. Guanaes 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 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.