Aberdeen Latin American Income Fund (ALAIF) SWOT Analysis / TOWS Matrix / MBA Resources
Investment Services
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Aberdeen Latin American Income Fund (United Kingdom)
Based on various researches at Oak Spring University , Aberdeen Latin American Income Fund is operating in a macro-environment that has been destablized by – increasing energy prices, central banks are concerned over increasing inflation, talent flight as more people leaving formal jobs, there is backlash against globalization, digital marketing is dominated by two big players Facebook and Google, supply chains are disrupted by pandemic , increasing household debt because of falling income levels,
wage bills are increasing, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of Aberdeen Latin American Income Fund
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Aberdeen Latin American Income Fund can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Aberdeen Latin American Income Fund, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Aberdeen Latin American Income Fund 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 Aberdeen Latin American Income Fund can be done for the following purposes –
1. Strategic planning of Aberdeen Latin American Income Fund
2. Improving business portfolio management of Aberdeen Latin American Income Fund
3. Assessing feasibility of the new initiative in United Kingdom
4. Making a Investment Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Aberdeen Latin American Income Fund
Strengths of Aberdeen Latin American Income Fund | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Aberdeen Latin American Income Fund are -
Learning organization
- Aberdeen Latin American Income Fund 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 Aberdeen Latin American Income Fund is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Aberdeen Latin American Income Fund emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Aberdeen Latin American Income Fund is present in almost all the verticals within the Investment Services industry. This has provided Aberdeen Latin American Income Fund 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.
Highly skilled collaborators
– Aberdeen Latin American Income Fund has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Investment Services industry. Secondly the value chain collaborators of Aberdeen Latin American Income Fund have helped the firm to develop new products and bring them quickly to the marketplace.
Low bargaining power of suppliers
– Suppliers of Aberdeen Latin American Income Fund in the Financial sector have low bargaining power. Aberdeen Latin American Income Fund has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Aberdeen Latin American Income Fund to manage not only supply disruptions but also source products at highly competitive prices.
Cross disciplinary teams
– Horizontal connected teams at the Aberdeen Latin American Income Fund 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 of Aberdeen Latin American Income Fund comprises – understanding the underlying the factors in the Investment Services 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.
Ability to lead change in Investment Services
– Aberdeen Latin American Income Fund is one of the leading players in the Investment Services industry in United Kingdom. Over the years it has not only transformed the business landscape in the Investment Services industry in United Kingdom but also across the existing markets. The ability to lead change has enabled Aberdeen Latin American Income Fund in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High switching costs
– The high switching costs that Aberdeen Latin American Income Fund 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.
Ability to recruit top talent
– Aberdeen Latin American Income Fund is one of the leading players in the Investment Services industry in United Kingdom. It is in a position to attract the best talent available in United Kingdom. The firm has a robust talent identification program that helps in identifying the brightest.
Strong track record of project management in the Investment Services industry
– Aberdeen Latin American Income Fund is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High brand equity
– Aberdeen Latin American Income Fund has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Aberdeen Latin American Income Fund to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Effective Research and Development (R&D)
– Aberdeen Latin American Income Fund has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Aberdeen Latin American Income Fund staying ahead in the Investment Services industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses of Aberdeen Latin American Income Fund | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Aberdeen Latin American Income Fund are -
High bargaining power of channel partners in Investment Services industry
– because of the regulatory requirements in United Kingdom, Aberdeen Latin American Income Fund 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 Investment Services industry.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Aberdeen Latin American Income Fund is slow explore the new channels of communication. These new channels of communication can help Aberdeen Latin American Income Fund to provide better information regarding Investment Services products and services. It can also build an online community to further reach out to potential customers.
No frontier risks strategy
– From the 10K / annual statement of Aberdeen Latin American Income Fund, it seems that company is thinking out the frontier risks that can impact Investment 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.
Increasing silos among functional specialists
– The organizational structure of Aberdeen Latin American Income Fund is dominated by functional specialists. It is not different from other players in the Investment Services industry, but Aberdeen Latin American Income Fund needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Aberdeen Latin American Income Fund to focus more on services in the Investment Services industry rather than just following the product oriented approach.
Compensation and incentives
– The revenue per employee of Aberdeen Latin American Income Fund is just above the Investment 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.
Lack of clear differentiation of Aberdeen Latin American Income Fund products
– To increase the profitability and margins on the products, Aberdeen Latin American Income Fund needs to provide more differentiated products than what it is currently offering in the marketplace.
Need for greater diversity
– Aberdeen Latin American Income Fund 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.
Slow to strategic competitive environment developments
– As Aberdeen Latin American Income Fund is one of the leading players in the Investment Services industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Investment Services industry in last five years.
Ability to respond to the competition
– As the decision making is very deliberative at Aberdeen Latin American Income Fund, in the dynamic environment of Investment Services industry it has struggled to respond to the nimble upstart competition. Aberdeen Latin American Income Fund 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 Aberdeen Latin American Income Fund supply chain. Even after few cautionary changes, Aberdeen Latin American Income Fund is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Aberdeen Latin American Income Fund vulnerable to further global disruptions in South East Asia.
Products dominated business model
– Even though Aberdeen Latin American Income Fund has some of the most successful models in the Investment Services industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Aberdeen Latin American Income Fund should strive to include more intangible value offerings along with its core products and services.
Aberdeen Latin American Income Fund Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Aberdeen Latin American Income Fund are -
Creating value in data economy
– The success of analytics program of Aberdeen Latin American Income Fund has opened avenues for new revenue streams for the organization in Investment Services industry. This can help Aberdeen Latin American Income Fund to build a more holistic ecosystem for Aberdeen Latin American Income Fund products in the Investment 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, Aberdeen Latin American Income Fund can use these opportunities to build new business models that can help the communities that Aberdeen Latin American Income Fund operates in. Secondly it can use opportunities from government spending in Investment Services sector.
Leveraging digital technologies
– Aberdeen Latin American Income Fund 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Aberdeen Latin American Income Fund is facing challenges because of the dominance of functional experts in the organization. Aberdeen Latin American Income Fund can utilize new technology in the field of Investment Services industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Investment Services industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Aberdeen Latin American Income Fund 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. Aberdeen Latin American Income Fund 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Aberdeen Latin American Income Fund 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
– Aberdeen Latin American Income Fund can develop new processes and procedures in Investment 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Aberdeen Latin American Income Fund 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 Aberdeen Latin American Income Fund to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Using analytics as competitive advantage
– Aberdeen Latin American Income Fund has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Investment Services sector. This continuous investment in analytics has enabled Aberdeen Latin American Income Fund to build a competitive advantage using analytics. The analytics driven competitive advantage can help Aberdeen Latin American Income Fund to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Low interest rates
– Even though inflation is raising its head in most developed economies, Aberdeen Latin American Income Fund 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.
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. Aberdeen Latin American Income Fund can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Better consumer reach
– The expansion of the 5G network will help Aberdeen Latin American Income Fund to increase its market reach. Aberdeen Latin American Income Fund 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.
Manufacturing automation
– Aberdeen Latin American Income Fund can use the latest technology developments to improve its manufacturing and designing process in Investment Services sector. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Threats Aberdeen Latin American Income Fund External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Aberdeen Latin American Income Fund are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Aberdeen Latin American Income Fund in Investment Services industry. The Investment 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Aberdeen Latin American Income Fund can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate Aberdeen Latin American Income Fund prominent markets.
Environmental challenges
– Aberdeen Latin American Income Fund 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. Aberdeen Latin American Income Fund can take advantage of this fund but it will also bring new competitors in the Investment Services industry.
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 Aberdeen Latin American Income Fund.
Stagnating economy with rate increase
– Aberdeen Latin American Income Fund 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 Investment Services industry.
Easy access to finance
– Easy access to finance in Investment Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Aberdeen Latin American Income Fund can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
High dependence on third party suppliers
– Aberdeen Latin American Income Fund 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.
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. Aberdeen Latin American Income Fund 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.
Increasing wage structure of Aberdeen Latin American Income Fund
– 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 Aberdeen Latin American Income Fund.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Investment Services industry are lowering. It can presents Aberdeen Latin American Income Fund with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Investment Services sector.
Consumer confidence and its impact on Aberdeen Latin American Income Fund 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 Investment Services industry and other sectors.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Aberdeen Latin American Income Fund may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Investment Services sector.
Technology acceleration in Forth Industrial Revolution
– Aberdeen Latin American Income Fund has witnessed rapid integration of technology during Covid-19 in the Investment Services industry. As one of the leading players in the industry, Aberdeen Latin American Income Fund needs to keep up with the evolution of technology in the Investment 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.
Weighted SWOT Analysis of Aberdeen Latin American Income Fund Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Aberdeen Latin American Income Fund 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 Aberdeen Latin American Income Fund 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 Aberdeen Latin American Income Fund 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 Aberdeen Latin American Income Fund 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 Aberdeen Latin American Income Fund needs to make to build a sustainable competitive advantage.