SUL AMERICA UNT (SULA11) SWOT Analysis / TOWS Matrix / MBA Resources
Insurance (Accident & Health)
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for SUL AMERICA UNT (Brazil)
Based on various researches at Oak Spring University , SUL AMERICA UNT is operating in a macro-environment that has been destablized by – increasing inequality as vast percentage of new income is going to the top 1%, talent flight as more people leaving formal jobs, increasing household debt because of falling income levels, digital marketing is dominated by two big players Facebook and Google, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing commodity prices, increasing government debt because of Covid-19 spendings,
customer relationship management is fast transforming because of increasing concerns over data privacy, supply chains are disrupted by pandemic , etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that SUL AMERICA UNT can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the SUL AMERICA UNT, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which SUL AMERICA UNT 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 SUL AMERICA UNT can be done for the following purposes –
1. Strategic planning of SUL AMERICA UNT
2. Improving business portfolio management of SUL AMERICA UNT
3. Assessing feasibility of the new initiative in Brazil
4. Making a Insurance (Accident & Health) sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of SUL AMERICA UNT
Strengths of SUL AMERICA UNT | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of SUL AMERICA UNT are -
Strong track record of project management in the Insurance (Accident & Health) industry
– SUL AMERICA UNT is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Operational resilience
– The operational resilience strategy of SUL AMERICA UNT comprises – understanding the underlying the factors in the Insurance (Accident & Health) 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.
Digital Transformation in Insurance (Accident & Health) industry
- digital transformation varies from industry to industry. For SUL AMERICA UNT digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. SUL AMERICA UNT 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.
High brand equity
– SUL AMERICA UNT has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled SUL AMERICA UNT to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Highly skilled collaborators
– SUL AMERICA UNT has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Insurance (Accident & Health) industry. Secondly the value chain collaborators of SUL AMERICA UNT have helped the firm to develop new products and bring them quickly to the marketplace.
Diverse revenue streams
– SUL AMERICA UNT is present in almost all the verticals within the Insurance (Accident & Health) industry. This has provided SUL AMERICA UNT 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.
Learning organization
- SUL AMERICA UNT 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 SUL AMERICA UNT is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at SUL AMERICA UNT emphasize – knowledge, initiative, and innovation.
Superior customer experience
– The customer experience strategy of SUL AMERICA UNT in Insurance (Accident & Health) industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to lead change in Insurance (Accident & Health)
– SUL AMERICA UNT is one of the leading players in the Insurance (Accident & Health) industry in Brazil. Over the years it has not only transformed the business landscape in the Insurance (Accident & Health) industry in Brazil but also across the existing markets. The ability to lead change has enabled SUL AMERICA UNT in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Successful track record of launching new products
– SUL AMERICA UNT has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. SUL AMERICA UNT 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.
Sustainable margins compare to other players in Insurance (Accident & Health) industry
– SUL AMERICA UNT has clearly differentiated products in the market place. This has enabled SUL AMERICA UNT to fetch slight price premium compare to the competitors in the Insurance (Accident & Health) industry. The sustainable margins have also helped SUL AMERICA UNT to invest into research and development (R&D) and innovation.
Effective Research and Development (R&D)
– SUL AMERICA UNT has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – SUL AMERICA UNT staying ahead in the Insurance (Accident & Health) industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses of SUL AMERICA UNT | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of SUL AMERICA UNT are -
Employees’ less understanding of SUL AMERICA UNT strategy
– From the outside it seems that the employees of SUL AMERICA UNT 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.
High cash cycle compare to competitors
SUL AMERICA UNT has a high cash cycle compare to other players in the Insurance (Accident & Health) industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Lack of clear differentiation of SUL AMERICA UNT products
– To increase the profitability and margins on the products, SUL AMERICA UNT needs to provide more differentiated products than what it is currently offering in the marketplace.
Compensation and incentives
– The revenue per employee of SUL AMERICA UNT is just above the Insurance (Accident & Health) 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.
Ability to respond to the competition
– As the decision making is very deliberative at SUL AMERICA UNT, in the dynamic environment of Insurance (Accident & Health) industry it has struggled to respond to the nimble upstart competition. SUL AMERICA UNT has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High bargaining power of channel partners in Insurance (Accident & Health) industry
– because of the regulatory requirements in Brazil, SUL AMERICA UNT 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 Insurance (Accident & Health) industry.
Skills based hiring in Insurance (Accident & Health) industry
– The stress on hiring functional specialists at SUL AMERICA UNT 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.
Aligning sales with marketing
– From the outside it seems that SUL AMERICA UNT needs to have more collaboration between its sales team and marketing team. Sales professionals in the Insurance (Accident & Health) industry have deep experience in developing customer relationships. Marketing department at SUL AMERICA UNT can leverage the sales team experience to cultivate customer relationships as SUL AMERICA UNT is planning to shift buying processes online.
Interest costs
– Compare to the competition, SUL AMERICA UNT 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.
Need for greater diversity
– SUL AMERICA UNT 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.
Products dominated business model
– Even though SUL AMERICA UNT has some of the most successful models in the Insurance (Accident & Health) industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. SUL AMERICA UNT should strive to include more intangible value offerings along with its core products and services.
SUL AMERICA UNT Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of SUL AMERICA UNT are -
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. SUL AMERICA UNT 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 SUL AMERICA UNT to increase its market reach. SUL AMERICA UNT 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for SUL AMERICA UNT in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Insurance (Accident & Health) industry, and it will provide faster access to the consumers.
Low interest rates
– Even though inflation is raising its head in most developed economies, SUL AMERICA UNT 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Insurance (Accident & Health) industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. SUL AMERICA UNT 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. SUL AMERICA UNT 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.
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 SUL AMERICA UNT 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.
Loyalty marketing
– SUL AMERICA UNT 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects SUL AMERICA UNT can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Using analytics as competitive advantage
– SUL AMERICA UNT has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Insurance (Accident & Health) sector. This continuous investment in analytics has enabled SUL AMERICA UNT to build a competitive advantage using analytics. The analytics driven competitive advantage can help SUL AMERICA UNT to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, SUL AMERICA UNT can use these opportunities to build new business models that can help the communities that SUL AMERICA UNT operates in. Secondly it can use opportunities from government spending in Insurance (Accident & Health) sector.
Leveraging digital technologies
– SUL AMERICA UNT 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.
Building a culture of innovation
– managers at SUL AMERICA UNT 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 Insurance (Accident & Health) industry.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Insurance (Accident & Health) industry, but it has also influenced the consumer preferences. SUL AMERICA UNT can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats SUL AMERICA UNT External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of SUL AMERICA UNT are -
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.
High dependence on third party suppliers
– SUL AMERICA UNT 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for SUL AMERICA UNT in Insurance (Accident & Health) industry. The Insurance (Accident & Health) 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.
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. SUL AMERICA UNT needs to understand the core reasons impacting the Insurance (Accident & Health) industry. This will help it in building a better workplace.
Stagnating economy with rate increase
– SUL AMERICA UNT 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 Insurance (Accident & Health) industry.
Consumer confidence and its impact on SUL AMERICA UNT 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 Insurance (Accident & Health) industry and other sectors.
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 SUL AMERICA UNT business can come under increasing regulations regarding data privacy, data security, etc.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of SUL AMERICA UNT.
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 SUL AMERICA UNT in the Insurance (Accident & Health) sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– SUL AMERICA UNT has witnessed rapid integration of technology during Covid-19 in the Insurance (Accident & Health) industry. As one of the leading players in the industry, SUL AMERICA UNT needs to keep up with the evolution of technology in the Insurance (Accident & Health) 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.
Environmental challenges
– SUL AMERICA UNT 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. SUL AMERICA UNT can take advantage of this fund but it will also bring new competitors in the Insurance (Accident & Health) industry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, SUL AMERICA UNT may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Insurance (Accident & Health) sector.
Shortening product life cycle
– it is one of the major threat that SUL AMERICA UNT is facing in Insurance (Accident & Health) sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of SUL AMERICA UNT Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at SUL AMERICA UNT 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 SUL AMERICA UNT 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 SUL AMERICA UNT 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 SUL AMERICA UNT 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 SUL AMERICA UNT needs to make to build a sustainable competitive advantage.