KLABIN S/A UNT N2 (KLBN11) SWOT Analysis / TOWS Matrix / MBA Resources
Paper & Paper Products
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for KLABIN S/A UNT N2 (Brazil)
Based on various researches at Oak Spring University , KLABIN S/A UNT N2 is operating in a macro-environment that has been destablized by – talent flight as more people leaving formal jobs, increasing government debt because of Covid-19 spendings, increasing transportation and logistics costs, increasing commodity prices, there is backlash against globalization, customer relationship management is fast transforming because of increasing concerns over data privacy, geopolitical disruptions,
increasing household debt because of falling income levels, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of KLABIN S/A UNT N2
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that KLABIN S/A UNT N2 can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the KLABIN S/A UNT N2, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which KLABIN S/A UNT N2 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 KLABIN S/A UNT N2 can be done for the following purposes –
1. Strategic planning of KLABIN S/A UNT N2
2. Improving business portfolio management of KLABIN S/A UNT N2
3. Assessing feasibility of the new initiative in Brazil
4. Making a Paper & Paper Products sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of KLABIN S/A UNT N2
Strengths of KLABIN S/A UNT N2 | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of KLABIN S/A UNT N2 are -
Training and development
– KLABIN S/A UNT N2 has one of the best training and development program in Basic Materials industry. The effectiveness of the training programs can be measured in – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
High switching costs
– The high switching costs that KLABIN S/A UNT N2 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.
High brand equity
– KLABIN S/A UNT N2 has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled KLABIN S/A UNT N2 to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to lead change in Paper & Paper Products
– KLABIN S/A UNT N2 is one of the leading players in the Paper & Paper Products industry in Brazil. Over the years it has not only transformed the business landscape in the Paper & Paper Products industry in Brazil but also across the existing markets. The ability to lead change has enabled KLABIN S/A UNT N2 in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Effective Research and Development (R&D)
– KLABIN S/A UNT N2 has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – KLABIN S/A UNT N2 staying ahead in the Paper & Paper Products industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Highly skilled collaborators
– KLABIN S/A UNT N2 has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Paper & Paper Products industry. Secondly the value chain collaborators of KLABIN S/A UNT N2 have helped the firm to develop new products and bring them quickly to the marketplace.
Digital Transformation in Paper & Paper Products industry
- digital transformation varies from industry to industry. For KLABIN S/A UNT N2 digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. KLABIN S/A UNT N2 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.
Cross disciplinary teams
– Horizontal connected teams at the KLABIN S/A UNT N2 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.
Innovation driven organization
– KLABIN S/A UNT N2 is one of the most innovative firm in Paper & Paper Products sector.
Superior customer experience
– The customer experience strategy of KLABIN S/A UNT N2 in Paper & Paper Products industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Analytics focus
– KLABIN S/A UNT N2 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 Paper & Paper Products 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.
Diverse revenue streams
– KLABIN S/A UNT N2 is present in almost all the verticals within the Paper & Paper Products industry. This has provided KLABIN S/A UNT N2 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.
Weaknesses of KLABIN S/A UNT N2 | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of KLABIN S/A UNT N2 are -
Need for greater diversity
– KLABIN S/A UNT N2 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.
Skills based hiring in Paper & Paper Products industry
– The stress on hiring functional specialists at KLABIN S/A UNT N2 has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Workers concerns about automation
– As automation is fast increasing in the Paper & Paper Products industry, KLABIN S/A UNT N2 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.
High dependence on KLABIN S/A UNT N2 ‘s star products
– The top 2 products and services of KLABIN S/A UNT N2 still accounts for major business revenue. This dependence on star products in Paper & Paper Products industry has resulted into insufficient focus on developing new products, even though KLABIN S/A UNT N2 has relatively successful track record of launching new products.
Employees’ less understanding of KLABIN S/A UNT N2 strategy
– From the outside it seems that the employees of KLABIN S/A UNT N2 don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, KLABIN S/A UNT N2 is slow explore the new channels of communication. These new channels of communication can help KLABIN S/A UNT N2 to provide better information regarding Paper & Paper Products products and services. It can also build an online community to further reach out to potential customers.
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 KLABIN S/A UNT N2 supply chain. Even after few cautionary changes, KLABIN S/A UNT N2 is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left KLABIN S/A UNT N2 vulnerable to further global disruptions in South East Asia.
Capital Spending Reduction
– Even during the low interest decade, KLABIN S/A UNT N2 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 Paper & Paper Products industry using digital technology.
Increasing silos among functional specialists
– The organizational structure of KLABIN S/A UNT N2 is dominated by functional specialists. It is not different from other players in the Paper & Paper Products industry, but KLABIN S/A UNT N2 needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help KLABIN S/A UNT N2 to focus more on services in the Paper & Paper Products industry rather than just following the product oriented approach.
High cash cycle compare to competitors
KLABIN S/A UNT N2 has a high cash cycle compare to other players in the Paper & Paper Products industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Slow to strategic competitive environment developments
– As KLABIN S/A UNT N2 is one of the leading players in the Paper & Paper Products industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Paper & Paper Products industry in last five years.
KLABIN S/A UNT N2 Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of KLABIN S/A UNT N2 are -
Creating value in data economy
– The success of analytics program of KLABIN S/A UNT N2 has opened avenues for new revenue streams for the organization in Paper & Paper Products industry. This can help KLABIN S/A UNT N2 to build a more holistic ecosystem for KLABIN S/A UNT N2 products in the Paper & Paper Products industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– KLABIN S/A UNT N2 can improve the customer journey of consumers in the Paper & Paper Products 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.
Building a culture of innovation
– managers at KLABIN S/A UNT N2 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 Paper & Paper Products industry.
Better consumer reach
– The expansion of the 5G network will help KLABIN S/A UNT N2 to increase its market reach. KLABIN S/A UNT N2 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.
Leveraging digital technologies
– KLABIN S/A UNT N2 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Paper & Paper Products industry, but it has also influenced the consumer preferences. KLABIN S/A UNT N2 can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Learning at scale
– Online learning technologies has now opened space for KLABIN S/A UNT N2 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, KLABIN S/A UNT N2 is facing challenges because of the dominance of functional experts in the organization. KLABIN S/A UNT N2 can utilize new technology in the field of Paper & Paper Products industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for KLABIN S/A UNT N2 in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Paper & Paper Products industry, and it will provide faster access to the consumers.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, KLABIN S/A UNT N2 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 KLABIN S/A UNT N2 to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. KLABIN S/A UNT N2 can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Use of Bitcoin and other crypto currencies for transactions in Paper & Paper Products industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for KLABIN S/A UNT N2 in the Paper & Paper Products industry. Now KLABIN S/A UNT N2 can target international markets with far fewer capital restrictions requirements than the existing system.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, KLABIN S/A UNT N2 can use these opportunities to build new business models that can help the communities that KLABIN S/A UNT N2 operates in. Secondly it can use opportunities from government spending in Paper & Paper Products sector.
Threats KLABIN S/A UNT N2 External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of KLABIN S/A UNT N2 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. KLABIN S/A UNT N2 needs to understand the core reasons impacting the Paper & Paper Products industry. This will help it in building a better workplace.
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
– KLABIN S/A UNT N2 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.
Stagnating economy with rate increase
– KLABIN S/A UNT N2 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 Paper & Paper Products industry.
Increasing wage structure of KLABIN S/A UNT N2
– 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 KLABIN S/A UNT N2.
Consumer confidence and its impact on KLABIN S/A UNT N2 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 Paper & Paper Products industry and other sectors.
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.
Shortening product life cycle
– it is one of the major threat that KLABIN S/A UNT N2 is facing in Paper & Paper Products sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. KLABIN S/A UNT N2 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.
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 KLABIN S/A UNT N2 in the Paper & Paper Products sector and impact the bottomline of the organization.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Paper & Paper Products industry are lowering. It can presents KLABIN S/A UNT N2 with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Paper & Paper Products sector.
Environmental challenges
– KLABIN S/A UNT N2 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. KLABIN S/A UNT N2 can take advantage of this fund but it will also bring new competitors in the Paper & Paper Products industry.
Easy access to finance
– Easy access to finance in Paper & Paper Products industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. KLABIN S/A UNT N2 can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of KLABIN S/A UNT N2 Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at KLABIN S/A UNT N2 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 KLABIN S/A UNT N2 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 KLABIN S/A UNT N2 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 KLABIN S/A UNT N2 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 KLABIN S/A UNT N2 needs to make to build a sustainable competitive advantage.