SWOT Analysis / TOWS Matrix for Maire Tecnimont (Italy)
Based on various researches at Oak Spring University , Maire Tecnimont is operating in a macro-environment that has been destablized by – digital marketing is dominated by two big players Facebook and Google, banking and financial system is disrupted by Bitcoin and other crypto currencies, technology disruption, there is backlash against globalization, competitive advantages are harder to sustain because of technology dispersion, wage bills are increasing, there is increasing trade war between United States & China,
increasing commodity prices, cloud computing is disrupting traditional business models, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Maire Tecnimont can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Maire Tecnimont, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Maire Tecnimont 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 Maire Tecnimont can be done for the following purposes –
1. Strategic planning of Maire Tecnimont
2. Improving business portfolio management of Maire Tecnimont
3. Assessing feasibility of the new initiative in Italy
4. Making a Construction Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Maire Tecnimont
Strengths of Maire Tecnimont | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Maire Tecnimont are -
Low bargaining power of suppliers
– Suppliers of Maire Tecnimont in the Capital Goods sector have low bargaining power. Maire Tecnimont has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Maire Tecnimont to manage not only supply disruptions but also source products at highly competitive prices.
Innovation driven organization
– Maire Tecnimont is one of the most innovative firm in Construction Services sector.
Effective Research and Development (R&D)
– Maire Tecnimont has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Maire Tecnimont staying ahead in the Construction Services industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Organizational Resilience of Maire Tecnimont
– The covid-19 pandemic has put organizational resilience at the centre of everthing Maire Tecnimont does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High brand equity
– Maire Tecnimont has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Maire Tecnimont to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Strong track record of project management in the Construction Services industry
– Maire Tecnimont is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to recruit top talent
– Maire Tecnimont is one of the leading players in the Construction Services industry in Italy. It is in a position to attract the best talent available in Italy. The firm has a robust talent identification program that helps in identifying the brightest.
Highly skilled collaborators
– Maire Tecnimont has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Construction Services industry. Secondly the value chain collaborators of Maire Tecnimont have helped the firm to develop new products and bring them quickly to the marketplace.
Sustainable margins compare to other players in Construction Services industry
– Maire Tecnimont has clearly differentiated products in the market place. This has enabled Maire Tecnimont to fetch slight price premium compare to the competitors in the Construction Services industry. The sustainable margins have also helped Maire Tecnimont to invest into research and development (R&D) and innovation.
Superior customer experience
– The customer experience strategy of Maire Tecnimont in Construction Services industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Digital Transformation in Construction Services industry
- digital transformation varies from industry to industry. For Maire Tecnimont digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Maire Tecnimont 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.
Learning organization
- Maire Tecnimont 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 Maire Tecnimont is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Maire Tecnimont emphasize – knowledge, initiative, and innovation.
Weaknesses of Maire Tecnimont | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Maire Tecnimont are -
Slow to strategic competitive environment developments
– As Maire Tecnimont is one of the leading players in the Construction Services industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Construction Services industry in last five years.
High operating costs
– Compare to the competitors, Maire Tecnimont has high operating costs in the Construction Services industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Maire Tecnimont lucrative customers.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Maire Tecnimont is slow explore the new channels of communication. These new channels of communication can help Maire Tecnimont to provide better information regarding Construction Services products and services. It can also build an online community to further reach out to potential customers.
Ability to respond to the competition
– As the decision making is very deliberative at Maire Tecnimont, in the dynamic environment of Construction Services industry it has struggled to respond to the nimble upstart competition. Maire Tecnimont has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Compensation and incentives
– The revenue per employee of Maire Tecnimont is just above the Construction Services industry average. It 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.
Increasing silos among functional specialists
– The organizational structure of Maire Tecnimont is dominated by functional specialists. It is not different from other players in the Construction Services industry, but Maire Tecnimont needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Maire Tecnimont to focus more on services in the Construction Services industry rather than just following the product oriented approach.
Lack of clear differentiation of Maire Tecnimont products
– To increase the profitability and margins on the products, Maire Tecnimont needs to provide more differentiated products than what it is currently offering in the marketplace.
No frontier risks strategy
– From the 10K / annual statement of Maire Tecnimont, it seems that company is thinking out the frontier risks that can impact Construction Services industry. 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.
Need for greater diversity
– Maire Tecnimont 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 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 Maire Tecnimont supply chain. Even after few cautionary changes, Maire Tecnimont is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Maire Tecnimont vulnerable to further global disruptions in South East Asia.
Capital Spending Reduction
– Even during the low interest decade, Maire Tecnimont 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 Construction Services industry using digital technology.
Maire Tecnimont Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Maire Tecnimont are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Maire Tecnimont 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 Maire Tecnimont to hire the very best people irrespective of their geographical location.
Using analytics as competitive advantage
– Maire Tecnimont has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Construction Services sector. This continuous investment in analytics has enabled Maire Tecnimont to build a competitive advantage using analytics. The analytics driven competitive advantage can help Maire Tecnimont to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Buying journey improvements
– Maire Tecnimont can improve the customer journey of consumers in the Construction Services industry by using analytics and artificial intelligence. It 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.
Creating value in data economy
– The success of analytics program of Maire Tecnimont has opened avenues for new revenue streams for the organization in Construction Services industry. This can help Maire Tecnimont to build a more holistic ecosystem for Maire Tecnimont products in the Construction Services industry by providing – data insight services, data privacy related products, data based consulting services, 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, Maire Tecnimont can use these opportunities to build new business models that can help the communities that Maire Tecnimont operates in. Secondly it can use opportunities from government spending in Construction Services sector.
Developing new processes and practices
– Maire Tecnimont can develop new processes and procedures in Construction Services 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Maire Tecnimont is facing challenges because of the dominance of functional experts in the organization. Maire Tecnimont can utilize new technology in the field of Construction Services industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Low interest rates
– Even though inflation is raising its head in most developed economies, Maire Tecnimont 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.
Better consumer reach
– The expansion of the 5G network will help Maire Tecnimont to increase its market reach. Maire Tecnimont 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Construction Services industry, but it has also influenced the consumer preferences. Maire Tecnimont can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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 Maire Tecnimont 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.
Learning at scale
– Online learning technologies has now opened space for Maire Tecnimont 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.
Use of Bitcoin and other crypto currencies for transactions in Construction Services industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Maire Tecnimont in the Construction Services industry. Now Maire Tecnimont can target international markets with far fewer capital restrictions requirements than the existing system.
Threats Maire Tecnimont External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Maire Tecnimont are -
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. Maire Tecnimont needs to understand the core reasons impacting the Construction Services industry. This will help it in building a better workplace.
Shortening product life cycle
– it is one of the major threat that Maire Tecnimont is facing in Construction Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Maire Tecnimont.
Easy access to finance
– Easy access to finance in Construction Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Maire Tecnimont can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Maire Tecnimont in the Construction Services sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Maire Tecnimont 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Maire Tecnimont may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Construction Services sector.
Technology acceleration in Forth Industrial Revolution
– Maire Tecnimont has witnessed rapid integration of technology during Covid-19 in the Construction Services industry. As one of the leading players in the industry, Maire Tecnimont needs to keep up with the evolution of technology in the Construction Services 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 Maire Tecnimont
– 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 Maire Tecnimont.
Stagnating economy with rate increase
– Maire Tecnimont 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 Construction Services industry.
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Maire Tecnimont in Construction Services industry. The Construction Services 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 Maire Tecnimont business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of Maire Tecnimont Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Maire Tecnimont 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 Maire Tecnimont 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 Maire Tecnimont 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 Maire Tecnimont 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 Maire Tecnimont needs to make to build a sustainable competitive advantage.