SWOT Analysis / TOWS Matrix for ENGIE BRASILON NM (Brazil)
Based on various researches at Oak Spring University , ENGIE BRASILON NM is operating in a macro-environment that has been destablized by – customer relationship management is fast transforming because of increasing concerns over data privacy, there is backlash against globalization, central banks are concerned over increasing inflation, technology disruption, increasing commodity prices, challanges to central banks by blockchain based private currencies, digital marketing is dominated by two big players Facebook and Google,
increasing inequality as vast percentage of new income is going to the top 1%, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of ENGIE BRASILON NM
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that ENGIE BRASILON NM can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the ENGIE BRASILON NM, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which ENGIE BRASILON NM 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 ENGIE BRASILON NM can be done for the following purposes –
1. Strategic planning of ENGIE BRASILON NM
2. Improving business portfolio management of ENGIE BRASILON NM
3. Assessing feasibility of the new initiative in Brazil
4. Making a Electric Utilities sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of ENGIE BRASILON NM
Strengths of ENGIE BRASILON NM | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of ENGIE BRASILON NM are -
Highly skilled collaborators
– ENGIE BRASILON NM has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Electric Utilities industry. Secondly the value chain collaborators of ENGIE BRASILON NM have helped the firm to develop new products and bring them quickly to the marketplace.
High brand equity
– ENGIE BRASILON NM has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled ENGIE BRASILON NM to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to lead change in Electric Utilities
– ENGIE BRASILON NM is one of the leading players in the Electric Utilities industry in Brazil. Over the years it has not only transformed the business landscape in the Electric Utilities industry in Brazil but also across the existing markets. The ability to lead change has enabled ENGIE BRASILON NM in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Superior customer experience
– The customer experience strategy of ENGIE BRASILON NM in Electric Utilities industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Effective Research and Development (R&D)
– ENGIE BRASILON NM has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – ENGIE BRASILON NM staying ahead in the Electric Utilities 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 ENGIE BRASILON NM 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.
Sustainable margins compare to other players in Electric Utilities industry
– ENGIE BRASILON NM has clearly differentiated products in the market place. This has enabled ENGIE BRASILON NM to fetch slight price premium compare to the competitors in the Electric Utilities industry. The sustainable margins have also helped ENGIE BRASILON NM to invest into research and development (R&D) and innovation.
Analytics focus
– ENGIE BRASILON NM 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 Electric Utilities 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.
Cross disciplinary teams
– Horizontal connected teams at the ENGIE BRASILON NM 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.
Learning organization
- ENGIE BRASILON NM 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 ENGIE BRASILON NM is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at ENGIE BRASILON NM emphasize – knowledge, initiative, and innovation.
Successful track record of launching new products
– ENGIE BRASILON NM has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. ENGIE BRASILON NM 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.
Digital Transformation in Electric Utilities industry
- digital transformation varies from industry to industry. For ENGIE BRASILON NM digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. ENGIE BRASILON NM 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.
Weaknesses of ENGIE BRASILON NM | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of ENGIE BRASILON NM are -
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 ENGIE BRASILON NM supply chain. Even after few cautionary changes, ENGIE BRASILON NM is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left ENGIE BRASILON NM vulnerable to further global disruptions in South East Asia.
Ability to respond to the competition
– As the decision making is very deliberative at ENGIE BRASILON NM, in the dynamic environment of Electric Utilities industry it has struggled to respond to the nimble upstart competition. ENGIE BRASILON NM has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Low market penetration in new markets
– Outside its home market of Brazil, ENGIE BRASILON NM needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Workers concerns about automation
– As automation is fast increasing in the Electric Utilities industry, ENGIE BRASILON NM needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Aligning sales with marketing
– From the outside it seems that ENGIE BRASILON NM needs to have more collaboration between its sales team and marketing team. Sales professionals in the Electric Utilities industry have deep experience in developing customer relationships. Marketing department at ENGIE BRASILON NM can leverage the sales team experience to cultivate customer relationships as ENGIE BRASILON NM is planning to shift buying processes online.
Compensation and incentives
– The revenue per employee of ENGIE BRASILON NM is just above the Electric Utilities 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.
High cash cycle compare to competitors
ENGIE BRASILON NM has a high cash cycle compare to other players in the Electric Utilities 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 bargaining power of channel partners in Electric Utilities industry
– because of the regulatory requirements in Brazil, ENGIE BRASILON NM 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 Electric Utilities industry.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, ENGIE BRASILON NM is slow explore the new channels of communication. These new channels of communication can help ENGIE BRASILON NM to provide better information regarding Electric Utilities products and services. It can also build an online community to further reach out to potential customers.
High operating costs
– Compare to the competitors, ENGIE BRASILON NM has high operating costs in the Electric Utilities industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract ENGIE BRASILON NM lucrative customers.
Interest costs
– Compare to the competition, ENGIE BRASILON NM 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.
ENGIE BRASILON NM Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of ENGIE BRASILON NM are -
Loyalty marketing
– ENGIE BRASILON NM has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
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 ENGIE BRASILON NM 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects ENGIE BRASILON NM can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Building a culture of innovation
– managers at ENGIE BRASILON NM 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 Electric Utilities industry.
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. ENGIE BRASILON NM can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Developing new processes and practices
– ENGIE BRASILON NM can develop new processes and procedures in Electric Utilities 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Electric Utilities industry, but it has also influenced the consumer preferences. ENGIE BRASILON NM 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 Electric Utilities industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. ENGIE BRASILON NM 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. ENGIE BRASILON NM 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.
Manufacturing automation
– ENGIE BRASILON NM can use the latest technology developments to improve its manufacturing and designing process in Electric Utilities 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.
Leveraging digital technologies
– ENGIE BRASILON NM can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, ENGIE BRASILON NM can use these opportunities to build new business models that can help the communities that ENGIE BRASILON NM operates in. Secondly it can use opportunities from government spending in Electric Utilities sector.
Using analytics as competitive advantage
– ENGIE BRASILON NM has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Electric Utilities sector. This continuous investment in analytics has enabled ENGIE BRASILON NM to build a competitive advantage using analytics. The analytics driven competitive advantage can help ENGIE BRASILON NM to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Learning at scale
– Online learning technologies has now opened space for ENGIE BRASILON NM 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.
Threats ENGIE BRASILON NM External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of ENGIE BRASILON NM are -
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.
High dependence on third party suppliers
– ENGIE BRASILON NM 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.
Consumer confidence and its impact on ENGIE BRASILON NM 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 Electric Utilities industry and other sectors.
Technology acceleration in Forth Industrial Revolution
– ENGIE BRASILON NM has witnessed rapid integration of technology during Covid-19 in the Electric Utilities industry. As one of the leading players in the industry, ENGIE BRASILON NM needs to keep up with the evolution of technology in the Electric Utilities 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, ENGIE BRASILON NM may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Electric Utilities sector.
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 ENGIE BRASILON NM business can come under increasing regulations regarding data privacy, data security, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for ENGIE BRASILON NM in Electric Utilities industry. The Electric Utilities 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.
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 ENGIE BRASILON NM.
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 ENGIE BRASILON NM in the Electric Utilities sector and impact the bottomline of the organization.
Easy access to finance
– Easy access to finance in Electric Utilities industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. ENGIE BRASILON NM 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, ENGIE BRASILON NM 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 ENGIE BRASILON NM prominent markets.
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. ENGIE BRASILON NM 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.
Weighted SWOT Analysis of ENGIE BRASILON NM Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at ENGIE BRASILON NM 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 ENGIE BRASILON NM 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 ENGIE BRASILON NM 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 ENGIE BRASILON NM 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 ENGIE BRASILON NM needs to make to build a sustainable competitive advantage.