Wells Fargo Co BDR (WFCO34) SWOT Analysis / TOWS Matrix / MBA Resources
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Wells Fargo Co BDR (Brazil)
Based on various researches at Oak Spring University , Wells Fargo Co BDR is operating in a macro-environment that has been destablized by – central banks are concerned over increasing inflation, increasing energy prices, increasing inequality as vast percentage of new income is going to the top 1%, there is increasing trade war between United States & China, increasing household debt because of falling income levels, cloud computing is disrupting traditional business models, geopolitical disruptions,
technology disruption, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Wells Fargo Co BDR
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Wells Fargo Co BDR can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Wells Fargo Co BDR, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Wells Fargo Co BDR 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 Wells Fargo Co BDR can be done for the following purposes –
1. Strategic planning of Wells Fargo Co BDR
2. Improving business portfolio management of Wells Fargo Co BDR
3. Assessing feasibility of the new initiative in Brazil
4. Making a sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Wells Fargo Co BDR
Strengths of Wells Fargo Co BDR | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Wells Fargo Co BDR are -
Highly skilled collaborators
– Wells Fargo Co BDR has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive industry. Secondly the value chain collaborators of Wells Fargo Co BDR have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Wells Fargo Co BDR is one of the most innovative firm in sector.
Low bargaining power of suppliers
– Suppliers of Wells Fargo Co BDR in the sector have low bargaining power. Wells Fargo Co BDR has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Wells Fargo Co BDR to manage not only supply disruptions but also source products at highly competitive prices.
Analytics focus
– Wells Fargo Co BDR 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 of Brazil is also helping it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Sustainable margins compare to other players in industry
– Wells Fargo Co BDR has clearly differentiated products in the market place. This has enabled Wells Fargo Co BDR to fetch slight price premium compare to the competitors in the industry. The sustainable margins have also helped Wells Fargo Co BDR to invest into research and development (R&D) and innovation.
Ability to lead change in
– Wells Fargo Co BDR is one of the leading players in the industry in Brazil. Over the years it has not only transformed the business landscape in the industry in Brazil but also across the existing markets. The ability to lead change has enabled Wells Fargo Co BDR in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Ability to recruit top talent
– Wells Fargo Co BDR is one of the leading players in the industry in Brazil. It is in a position to attract the best talent available in Brazil. The firm has a robust talent identification program that helps in identifying the brightest.
Effective Research and Development (R&D)
– Wells Fargo Co BDR has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Wells Fargo Co BDR staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Learning organization
- Wells Fargo Co BDR 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 Wells Fargo Co BDR is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Wells Fargo Co BDR emphasize – knowledge, initiative, and innovation.
Strong track record of project management in the industry
– Wells Fargo Co BDR is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Successful track record of launching new products
– Wells Fargo Co BDR has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Wells Fargo Co BDR 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.
Cross disciplinary teams
– Horizontal connected teams at the Wells Fargo Co BDR 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 of Wells Fargo Co BDR | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Wells Fargo Co BDR are -
Products dominated business model
– Even though Wells Fargo Co BDR has some of the most successful models in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Wells Fargo Co BDR should strive to include more intangible value offerings along with its core products and services.
High bargaining power of channel partners in industry
– because of the regulatory requirements in Brazil, Wells Fargo Co BDR 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.
Increasing silos among functional specialists
– The organizational structure of Wells Fargo Co BDR is dominated by functional specialists. It is not different from other players in the industry, but Wells Fargo Co BDR needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Wells Fargo Co BDR to focus more on services in the industry rather than just following the product oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Wells Fargo Co BDR 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.
No frontier risks strategy
– From the 10K / annual statement of Wells Fargo Co BDR, it seems that company is thinking out the frontier risks that can impact 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.
Compensation and incentives
– The revenue per employee of Wells Fargo Co BDR is just above the 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.
Slow to strategic competitive environment developments
– As Wells Fargo Co BDR is one of the leading players in the industry, it 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Wells Fargo Co BDR is slow explore the new channels of communication. These new channels of communication can help Wells Fargo Co BDR to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Lack of clear differentiation of Wells Fargo Co BDR products
– To increase the profitability and margins on the products, Wells Fargo Co BDR needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Wells Fargo Co BDR 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.
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 Wells Fargo Co BDR supply chain. Even after few cautionary changes, Wells Fargo Co BDR is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Wells Fargo Co BDR vulnerable to further global disruptions in South East Asia.
Wells Fargo Co BDR Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Wells Fargo Co BDR are -
Building a culture of innovation
– managers at Wells Fargo Co BDR 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 industry.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Wells Fargo Co BDR is facing challenges because of the dominance of functional experts in the organization. Wells Fargo Co BDR can utilize new technology in the field of industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in industry, but it has also influenced the consumer preferences. Wells Fargo Co BDR 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 industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Wells Fargo Co BDR 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. Wells Fargo Co BDR 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.
Buying journey improvements
– Wells Fargo Co BDR can improve the customer journey of consumers in the 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Wells Fargo Co BDR in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the industry, and it will provide faster access to the consumers.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Wells Fargo Co BDR can use these opportunities to build new business models that can help the communities that Wells Fargo Co BDR operates in. Secondly it can use opportunities from government spending in sector.
Use of Bitcoin and other crypto currencies for transactions in industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Wells Fargo Co BDR in the industry. Now Wells Fargo Co BDR 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. Wells Fargo Co BDR can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Low interest rates
– Even though inflation is raising its head in most developed economies, Wells Fargo Co BDR 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.
Creating value in data economy
– The success of analytics program of Wells Fargo Co BDR has opened avenues for new revenue streams for the organization in industry. This can help Wells Fargo Co BDR to build a more holistic ecosystem for Wells Fargo Co BDR products in the industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– Wells Fargo Co BDR has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in sector. This continuous investment in analytics has enabled Wells Fargo Co BDR to build a competitive advantage using analytics. The analytics driven competitive advantage can help Wells Fargo Co BDR to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Wells Fargo Co BDR 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 Wells Fargo Co BDR to hire the very best people irrespective of their geographical location.
Threats Wells Fargo Co BDR External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Wells Fargo Co BDR are -
Environmental challenges
– Wells Fargo Co BDR 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. Wells Fargo Co BDR can take advantage of this fund but it will also bring new competitors in the industry.
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. Wells Fargo Co BDR 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Wells Fargo Co BDR in industry. The 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.
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 Wells Fargo Co BDR in the sector and impact the bottomline of the organization.
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. Wells Fargo Co BDR needs to understand the core reasons impacting the industry. This will help it in building a better workplace.
Increasing wage structure of Wells Fargo Co BDR
– 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 Wells Fargo Co BDR.
Consumer confidence and its impact on Wells Fargo Co BDR 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 industry and other sectors.
Technology acceleration in Forth Industrial Revolution
– Wells Fargo Co BDR has witnessed rapid integration of technology during Covid-19 in the industry. As one of the leading players in the industry, Wells Fargo Co BDR needs to keep up with the evolution of technology in the 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.
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 Wells Fargo Co BDR business can come under increasing regulations regarding data privacy, data security, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Wells Fargo Co BDR may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of sector.
High dependence on third party suppliers
– Wells Fargo Co BDR 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.
Easy access to finance
– Easy access to finance in industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Wells Fargo Co BDR can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
Weighted SWOT Analysis of Wells Fargo Co BDR Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Wells Fargo Co BDR 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 Wells Fargo Co BDR 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 Wells Fargo Co BDR 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 Wells Fargo Co BDR 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 Wells Fargo Co BDR needs to make to build a sustainable competitive advantage.
