SANEPAR ON N2 (SAPR3) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for SANEPAR ON N2 (Brazil)

Based on various researches at Oak Spring University , SANEPAR ON N2 is operating in a macro-environment that has been destablized by – increasing energy prices, cloud computing is disrupting traditional business models, increasing household debt because of falling income levels, increasing inequality as vast percentage of new income is going to the top 1%, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing government debt because of Covid-19 spendings, supply chains are disrupted by pandemic , geopolitical disruptions, talent flight as more people leaving formal jobs, etc

---

---

---

---

Introduction to SWOT Analysis of SANEPAR ON N2

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that SANEPAR ON N2 can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the SANEPAR ON N2, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which SANEPAR ON 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 SANEPAR ON N2 can be done for the following purposes –
1. Strategic planning of SANEPAR ON N2
2. Improving business portfolio management of SANEPAR ON N2
3. Assessing feasibility of the new initiative in Brazil
4. Making a Water Utilities sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of SANEPAR ON N2

---

Strengths of SANEPAR ON N2 | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of SANEPAR ON N2 are -

Organizational Resilience of SANEPAR ON N2

– The covid-19 pandemic has put organizational resilience at the centre of everthing SANEPAR ON N2 does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.

Diverse revenue streams

– SANEPAR ON N2 is present in almost all the verticals within the Water Utilities industry. This has provided SANEPAR ON 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.

Highly skilled collaborators

– SANEPAR ON N2 has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Water Utilities industry. Secondly the value chain collaborators of SANEPAR ON N2 have helped the firm to develop new products and bring them quickly to the marketplace.

Superior customer experience

– The customer experience strategy of SANEPAR ON N2 in Water Utilities industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Strong track record of project management in the Water Utilities industry

– SANEPAR ON N2 is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Cross disciplinary teams

– Horizontal connected teams at the SANEPAR ON 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.

Analytics focus

– SANEPAR ON 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 Water 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.

Ability to lead change in Water Utilities

– SANEPAR ON N2 is one of the leading players in the Water Utilities industry in Brazil. Over the years it has not only transformed the business landscape in the Water Utilities industry in Brazil but also across the existing markets. The ability to lead change has enabled SANEPAR ON N2 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

– SANEPAR ON N2 is one of the leading players in the Water Utilities 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.

Successful track record of launching new products

– SANEPAR ON N2 has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. SANEPAR ON N2 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.

High brand equity

– SANEPAR ON N2 has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled SANEPAR ON N2 to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

High switching costs

– The high switching costs that SANEPAR ON 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.

---

---

Weaknesses of SANEPAR ON N2 | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of SANEPAR ON N2 are -

Interest costs

– Compare to the competition, SANEPAR ON N2 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.

Ability to respond to the competition

– As the decision making is very deliberative at SANEPAR ON N2, in the dynamic environment of Water Utilities industry it has struggled to respond to the nimble upstart competition. SANEPAR ON N2 has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

Slow to strategic competitive environment developments

– As SANEPAR ON N2 is one of the leading players in the Water Utilities industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Water Utilities 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, SANEPAR ON N2 is slow explore the new channels of communication. These new channels of communication can help SANEPAR ON N2 to provide better information regarding Water Utilities products and services. It can also build an online community to further reach out to potential customers.

High cash cycle compare to competitors

SANEPAR ON N2 has a high cash cycle compare to other players in the Water 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.

Workers concerns about automation

– As automation is fast increasing in the Water Utilities industry, SANEPAR ON 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 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 SANEPAR ON N2 supply chain. Even after few cautionary changes, SANEPAR ON N2 is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left SANEPAR ON N2 vulnerable to further global disruptions in South East Asia.

High dependence on SANEPAR ON N2 ‘s star products

– The top 2 products and services of SANEPAR ON N2 still accounts for major business revenue. This dependence on star products in Water Utilities industry has resulted into insufficient focus on developing new products, even though SANEPAR ON N2 has relatively successful track record of launching new products.

Need for greater diversity

– SANEPAR ON 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.

High operating costs

– Compare to the competitors, SANEPAR ON N2 has high operating costs in the Water Utilities industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract SANEPAR ON N2 lucrative customers.

High bargaining power of channel partners in Water Utilities industry

– because of the regulatory requirements in Brazil, SANEPAR ON N2 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 Water Utilities industry.

---

SANEPAR ON N2 Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of SANEPAR ON N2 are -

Learning at scale

– Online learning technologies has now opened space for SANEPAR ON 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.

Loyalty marketing

– SANEPAR ON N2 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.

Developing new processes and practices

– SANEPAR ON N2 can develop new processes and procedures in Water 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.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for SANEPAR ON N2 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 SANEPAR ON N2 to hire the very best people irrespective of their geographical location.

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, SANEPAR ON 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 SANEPAR ON 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.

Lowering marketing communication costs

– 5G expansion will open new opportunities for SANEPAR ON 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 Water Utilities industry, and it will provide faster access to the consumers.

Using analytics as competitive advantage

– SANEPAR ON N2 has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Water Utilities sector. This continuous investment in analytics has enabled SANEPAR ON N2 to build a competitive advantage using analytics. The analytics driven competitive advantage can help SANEPAR ON N2 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, SANEPAR ON N2 can use these opportunities to build new business models that can help the communities that SANEPAR ON N2 operates in. Secondly it can use opportunities from government spending in Water Utilities sector.

Building a culture of innovation

– managers at SANEPAR ON 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 Water Utilities industry.

Leveraging digital technologies

– SANEPAR ON 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.

Redefining models of collaboration and team work

– As explained in the weaknesses section, SANEPAR ON N2 is facing challenges because of the dominance of functional experts in the organization. SANEPAR ON N2 can utilize new technology in the field of Water Utilities industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.

Better consumer reach

– The expansion of the 5G network will help SANEPAR ON N2 to increase its market reach. SANEPAR ON 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.

Use of Bitcoin and other crypto currencies for transactions in Water Utilities industry

– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for SANEPAR ON N2 in the Water Utilities industry. Now SANEPAR ON N2 can target international markets with far fewer capital restrictions requirements than the existing system.

---

Threats SANEPAR ON N2 External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of SANEPAR ON N2 are -

Technology acceleration in Forth Industrial Revolution

– SANEPAR ON N2 has witnessed rapid integration of technology during Covid-19 in the Water Utilities industry. As one of the leading players in the industry, SANEPAR ON N2 needs to keep up with the evolution of technology in the Water 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.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for SANEPAR ON N2 in Water Utilities industry. The Water 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.

Easy access to finance

– Easy access to finance in Water Utilities industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. SANEPAR ON N2 can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.

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 SANEPAR ON N2.

High dependence on third party suppliers

– SANEPAR ON 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.

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. SANEPAR ON 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.

Stagnating economy with rate increase

– SANEPAR ON 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 Water Utilities industry.

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 SANEPAR ON N2 business can come under increasing regulations regarding data privacy, data security, etc.

Environmental challenges

– SANEPAR ON 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. SANEPAR ON N2 can take advantage of this fund but it will also bring new competitors in the Water Utilities industry.

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 SANEPAR ON N2 in the Water Utilities sector and impact the bottomline of the organization.

Increasing wage structure of SANEPAR ON 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 SANEPAR ON N2.

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, SANEPAR ON N2 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 SANEPAR ON N2 prominent markets.

---

Weighted SWOT Analysis of SANEPAR ON N2 Template, Example

Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at SANEPAR ON 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 SANEPAR ON 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 SANEPAR ON 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 SANEPAR ON 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 SANEPAR ON N2 needs to make to build a sustainable competitive advantage.

--- ---