Telecomunicacoes Brasileira SA Pref (TELB4) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Telecomunicacoes Brasileira SA Pref (Brazil)

Based on various researches at Oak Spring University , Telecomunicacoes Brasileira SA Pref is operating in a macro-environment that has been destablized by – increasing household debt because of falling income levels, customer relationship management is fast transforming because of increasing concerns over data privacy, talent flight as more people leaving formal jobs, competitive advantages are harder to sustain because of technology dispersion, technology disruption, there is increasing trade war between United States & China, challanges to central banks by blockchain based private currencies, there is backlash against globalization, supply chains are disrupted by pandemic , etc

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Introduction to SWOT Analysis of Telecomunicacoes Brasileira SA Pref

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Telecomunicacoes Brasileira SA Pref can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Telecomunicacoes Brasileira SA Pref, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Telecomunicacoes Brasileira SA Pref 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of Telecomunicacoes Brasileira SA Pref can be done for the following purposes –
1. Strategic planning of Telecomunicacoes Brasileira SA Pref
2. Improving business portfolio management of Telecomunicacoes Brasileira SA Pref
3. Assessing feasibility of the new initiative in Brazil
4. Making a Communications Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Telecomunicacoes Brasileira SA Pref

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Strengths of Telecomunicacoes Brasileira SA Pref | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Telecomunicacoes Brasileira SA Pref are -

Diverse revenue streams

– Telecomunicacoes Brasileira SA Pref is present in almost all the verticals within the Communications Services industry. This has provided Telecomunicacoes Brasileira SA Pref 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.

High switching costs

– The high switching costs that Telecomunicacoes Brasileira SA Pref 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

– Telecomunicacoes Brasileira SA Pref has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Telecomunicacoes Brasileira SA Pref to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Organizational Resilience of Telecomunicacoes Brasileira SA Pref

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

Superior customer experience

– The customer experience strategy of Telecomunicacoes Brasileira SA Pref in Communications Services industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Low bargaining power of suppliers

– Suppliers of Telecomunicacoes Brasileira SA Pref in the Services sector have low bargaining power. Telecomunicacoes Brasileira SA Pref has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Telecomunicacoes Brasileira SA Pref to manage not only supply disruptions but also source products at highly competitive prices.

Digital Transformation in Communications Services industry

- digital transformation varies from industry to industry. For Telecomunicacoes Brasileira SA Pref digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Telecomunicacoes Brasileira SA Pref 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.

Strong track record of project management in the Communications Services industry

– Telecomunicacoes Brasileira SA Pref 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

– Telecomunicacoes Brasileira SA Pref has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Telecomunicacoes Brasileira SA Pref 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.

Innovation driven organization

– Telecomunicacoes Brasileira SA Pref is one of the most innovative firm in Communications Services sector.

Training and development

– Telecomunicacoes Brasileira SA Pref has one of the best training and development program in Services 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.

Effective Research and Development (R&D)

– Telecomunicacoes Brasileira SA Pref has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Telecomunicacoes Brasileira SA Pref staying ahead in the Communications Services industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

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Weaknesses of Telecomunicacoes Brasileira SA Pref | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Telecomunicacoes Brasileira SA Pref are -

Ability to respond to the competition

– As the decision making is very deliberative at Telecomunicacoes Brasileira SA Pref, in the dynamic environment of Communications Services industry it has struggled to respond to the nimble upstart competition. Telecomunicacoes Brasileira SA Pref has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

Interest costs

– Compare to the competition, Telecomunicacoes Brasileira SA Pref 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.

Compensation and incentives

– The revenue per employee of Telecomunicacoes Brasileira SA Pref is just above the Communications Services 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.

Aligning sales with marketing

– From the outside it seems that Telecomunicacoes Brasileira SA Pref needs to have more collaboration between its sales team and marketing team. Sales professionals in the Communications Services industry have deep experience in developing customer relationships. Marketing department at Telecomunicacoes Brasileira SA Pref can leverage the sales team experience to cultivate customer relationships as Telecomunicacoes Brasileira SA Pref is planning to shift buying processes online.

High dependence on Telecomunicacoes Brasileira SA Pref ‘s star products

– The top 2 products and services of Telecomunicacoes Brasileira SA Pref still accounts for major business revenue. This dependence on star products in Communications Services industry has resulted into insufficient focus on developing new products, even though Telecomunicacoes Brasileira SA Pref has relatively successful track record of launching new products.

Workers concerns about automation

– As automation is fast increasing in the Communications Services industry, Telecomunicacoes Brasileira SA Pref 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.

Low market penetration in new markets

– Outside its home market of Brazil, Telecomunicacoes Brasileira SA Pref needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Telecomunicacoes Brasileira SA Pref is slow explore the new channels of communication. These new channels of communication can help Telecomunicacoes Brasileira SA Pref to provide better information regarding Communications Services products and services. It can also build an online community to further reach out to potential customers.

Need for greater diversity

– Telecomunicacoes Brasileira SA Pref 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.

Capital Spending Reduction

– Even during the low interest decade, Telecomunicacoes Brasileira SA Pref 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 Communications Services industry using digital technology.

Lack of clear differentiation of Telecomunicacoes Brasileira SA Pref products

– To increase the profitability and margins on the products, Telecomunicacoes Brasileira SA Pref needs to provide more differentiated products than what it is currently offering in the marketplace.

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Telecomunicacoes Brasileira SA Pref Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of Telecomunicacoes Brasileira SA Pref are -

Redefining models of collaboration and team work

– As explained in the weaknesses section, Telecomunicacoes Brasileira SA Pref is facing challenges because of the dominance of functional experts in the organization. Telecomunicacoes Brasileira SA Pref can utilize new technology in the field of Communications Services industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, 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 Telecomunicacoes Brasileira SA Pref 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.

Low interest rates

– Even though inflation is raising its head in most developed economies, Telecomunicacoes Brasileira SA Pref 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.

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects Telecomunicacoes Brasileira SA Pref can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Telecomunicacoes Brasileira SA Pref can use these opportunities to build new business models that can help the communities that Telecomunicacoes Brasileira SA Pref operates in. Secondly it can use opportunities from government spending in Communications Services sector.

Use of Bitcoin and other crypto currencies for transactions in Communications Services industry

– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Telecomunicacoes Brasileira SA Pref in the Communications Services industry. Now Telecomunicacoes Brasileira SA Pref can target international markets with far fewer capital restrictions requirements than the existing system.

Loyalty marketing

– Telecomunicacoes Brasileira SA Pref 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.

Learning at scale

– Online learning technologies has now opened space for Telecomunicacoes Brasileira SA Pref 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.

Developing new processes and practices

– Telecomunicacoes Brasileira SA Pref can develop new processes and procedures in Communications Services 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.

Buying journey improvements

– Telecomunicacoes Brasileira SA Pref can improve the customer journey of consumers in the Communications Services 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.

Manufacturing automation

– Telecomunicacoes Brasileira SA Pref can use the latest technology developments to improve its manufacturing and designing process in Communications Services 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.

Creating value in data economy

– The success of analytics program of Telecomunicacoes Brasileira SA Pref has opened avenues for new revenue streams for the organization in Communications Services industry. This can help Telecomunicacoes Brasileira SA Pref to build a more holistic ecosystem for Telecomunicacoes Brasileira SA Pref products in the Communications Services industry by providing – data insight services, data privacy related products, data based consulting services, etc.

Better consumer reach

– The expansion of the 5G network will help Telecomunicacoes Brasileira SA Pref to increase its market reach. Telecomunicacoes Brasileira SA Pref 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.

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Threats Telecomunicacoes Brasileira SA Pref External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of Telecomunicacoes Brasileira SA Pref are -

High dependence on third party suppliers

– Telecomunicacoes Brasileira SA Pref 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.

Shortening product life cycle

– it is one of the major threat that Telecomunicacoes Brasileira SA Pref is facing in Communications Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

Stagnating economy with rate increase

– Telecomunicacoes Brasileira SA Pref 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 Communications Services industry.

Environmental challenges

– Telecomunicacoes Brasileira SA Pref 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. Telecomunicacoes Brasileira SA Pref can take advantage of this fund but it will also bring new competitors in the Communications Services industry.

Regulatory challenges

– Telecomunicacoes Brasileira SA Pref needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Communications Services industry regulations.

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, Telecomunicacoes Brasileira SA Pref may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Communications Services sector.

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 Telecomunicacoes Brasileira SA Pref.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Telecomunicacoes Brasileira SA Pref in Communications Services industry. The Communications Services 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.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, Telecomunicacoes Brasileira SA Pref 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 Telecomunicacoes Brasileira SA Pref prominent markets.

Easy access to finance

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

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. Telecomunicacoes Brasileira SA Pref needs to understand the core reasons impacting the Communications Services industry. This will help it in building a better workplace.

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 Telecomunicacoes Brasileira SA Pref in the Communications Services sector and impact the bottomline of the organization.

Consumer confidence and its impact on Telecomunicacoes Brasileira SA Pref 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 Communications Services industry and other sectors.

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Weighted SWOT Analysis of Telecomunicacoes Brasileira SA Pref Template, Example

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

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