PETRORIO ON NM (PRIO3) SWOT Analysis / TOWS Matrix / MBA Resources
Oil & Gas - Integrated
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for PETRORIO ON NM (Brazil)
Based on various researches at Oak Spring University , PETRORIO ON NM is operating in a macro-environment that has been destablized by – central banks are concerned over increasing inflation, digital marketing is dominated by two big players Facebook and Google, geopolitical disruptions, customer relationship management is fast transforming because of increasing concerns over data privacy, challanges to central banks by blockchain based private currencies, there is increasing trade war between United States & China, cloud computing is disrupting traditional business models,
wage bills are increasing, technology disruption, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that PETRORIO ON NM can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the PETRORIO ON NM, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which PETRORIO ON NM operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of PETRORIO ON NM can be done for the following purposes –
1. Strategic planning of PETRORIO ON NM
2. Improving business portfolio management of PETRORIO ON NM
3. Assessing feasibility of the new initiative in Brazil
4. Making a Oil & Gas - Integrated sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of PETRORIO ON NM
Strengths of PETRORIO ON NM | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of PETRORIO ON NM are -
Sustainable margins compare to other players in Oil & Gas - Integrated industry
– PETRORIO ON NM has clearly differentiated products in the market place. This has enabled PETRORIO ON NM to fetch slight price premium compare to the competitors in the Oil & Gas - Integrated industry. The sustainable margins have also helped PETRORIO ON NM to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– PETRORIO ON NM has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Oil & Gas - Integrated industry. Secondly the value chain collaborators of PETRORIO ON NM have helped the firm to develop new products and bring them quickly to the marketplace.
Strong track record of project management in the Oil & Gas - Integrated industry
– PETRORIO ON NM is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to recruit top talent
– PETRORIO ON NM is one of the leading players in the Oil & Gas - Integrated 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.
Diverse revenue streams
– PETRORIO ON NM is present in almost all the verticals within the Oil & Gas - Integrated industry. This has provided PETRORIO ON NM 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.
Innovation driven organization
– PETRORIO ON NM is one of the most innovative firm in Oil & Gas - Integrated sector.
Analytics focus
– PETRORIO ON NM is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the Oil & Gas - Integrated 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.
Training and development
– PETRORIO ON NM has one of the best training and development program in Energy 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.
Superior customer experience
– The customer experience strategy of PETRORIO ON NM in Oil & Gas - Integrated industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Low bargaining power of suppliers
– Suppliers of PETRORIO ON NM in the Energy sector have low bargaining power. PETRORIO ON NM has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps PETRORIO ON NM to manage not only supply disruptions but also source products at highly competitive prices.
High brand equity
– PETRORIO ON NM has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled PETRORIO ON NM to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Organizational Resilience of PETRORIO ON NM
– The covid-19 pandemic has put organizational resilience at the centre of everthing PETRORIO ON NM does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses of PETRORIO ON NM | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of PETRORIO ON NM are -
Ability to respond to the competition
– As the decision making is very deliberative at PETRORIO ON NM, in the dynamic environment of Oil & Gas - Integrated industry it has struggled to respond to the nimble upstart competition. PETRORIO ON NM has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Products dominated business model
– Even though PETRORIO ON NM has some of the most successful models in the Oil & Gas - Integrated industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. PETRORIO ON NM should strive to include more intangible value offerings along with its core products and services.
Slow to strategic competitive environment developments
– As PETRORIO ON NM is one of the leading players in the Oil & Gas - Integrated industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Oil & Gas - Integrated industry in last five years.
Lack of clear differentiation of PETRORIO ON NM products
– To increase the profitability and margins on the products, PETRORIO ON NM needs to provide more differentiated products than what it is currently offering in the marketplace.
Workers concerns about automation
– As automation is fast increasing in the Oil & Gas - Integrated industry, PETRORIO ON NM needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
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 PETRORIO ON NM supply chain. Even after few cautionary changes, PETRORIO ON NM is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left PETRORIO ON NM vulnerable to further global disruptions in South East Asia.
High operating costs
– Compare to the competitors, PETRORIO ON NM has high operating costs in the Oil & Gas - Integrated industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract PETRORIO ON NM lucrative customers.
Skills based hiring in Oil & Gas - Integrated industry
– The stress on hiring functional specialists at PETRORIO ON NM 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.
Compensation and incentives
– The revenue per employee of PETRORIO ON NM is just above the Oil & Gas - Integrated 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.
Employees’ less understanding of PETRORIO ON NM strategy
– From the outside it seems that the employees of PETRORIO ON NM 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, PETRORIO ON NM is slow explore the new channels of communication. These new channels of communication can help PETRORIO ON NM to provide better information regarding Oil & Gas - Integrated products and services. It can also build an online community to further reach out to potential customers.
PETRORIO ON NM Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of PETRORIO ON NM are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects PETRORIO ON NM can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Redefining models of collaboration and team work
– As explained in the weaknesses section, PETRORIO ON NM is facing challenges because of the dominance of functional experts in the organization. PETRORIO ON NM can utilize new technology in the field of Oil & Gas - Integrated 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 PETRORIO ON NM to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Lowering marketing communication costs
– 5G expansion will open new opportunities for PETRORIO ON NM in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Oil & Gas - Integrated industry, and it will provide faster access to the consumers.
Loyalty marketing
– PETRORIO ON NM has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Creating value in data economy
– The success of analytics program of PETRORIO ON NM has opened avenues for new revenue streams for the organization in Oil & Gas - Integrated industry. This can help PETRORIO ON NM to build a more holistic ecosystem for PETRORIO ON NM products in the Oil & Gas - Integrated industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, PETRORIO ON NM 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 PETRORIO ON NM to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Leveraging digital technologies
– PETRORIO ON NM can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Using analytics as competitive advantage
– PETRORIO ON NM has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Oil & Gas - Integrated sector. This continuous investment in analytics has enabled PETRORIO ON NM to build a competitive advantage using analytics. The analytics driven competitive advantage can help PETRORIO ON NM 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, PETRORIO ON NM can use these opportunities to build new business models that can help the communities that PETRORIO ON NM operates in. Secondly it can use opportunities from government spending in Oil & Gas - Integrated sector.
Use of Bitcoin and other crypto currencies for transactions in Oil & Gas - Integrated industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for PETRORIO ON NM in the Oil & Gas - Integrated industry. Now PETRORIO ON NM can target international markets with far fewer capital restrictions requirements than the existing system.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Oil & Gas - Integrated industry, but it has also influenced the consumer preferences. PETRORIO ON NM can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Low interest rates
– Even though inflation is raising its head in most developed economies, PETRORIO ON NM 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.
Threats PETRORIO ON NM External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of PETRORIO ON NM are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for PETRORIO ON NM in Oil & Gas - Integrated industry. The Oil & Gas - Integrated 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 dependence on third party suppliers
– PETRORIO ON NM high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
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. PETRORIO ON NM needs to understand the core reasons impacting the Oil & Gas - Integrated industry. This will help it in building a better workplace.
Technology acceleration in Forth Industrial Revolution
– PETRORIO ON NM has witnessed rapid integration of technology during Covid-19 in the Oil & Gas - Integrated industry. As one of the leading players in the industry, PETRORIO ON NM needs to keep up with the evolution of technology in the Oil & Gas - Integrated sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, PETRORIO ON NM may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Oil & Gas - Integrated sector.
Easy access to finance
– Easy access to finance in Oil & Gas - Integrated industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. PETRORIO ON NM can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Oil & Gas - Integrated industry are lowering. It can presents PETRORIO ON NM with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Oil & Gas - Integrated sector.
Environmental challenges
– PETRORIO ON NM 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. PETRORIO ON NM can take advantage of this fund but it will also bring new competitors in the Oil & Gas - Integrated industry.
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. PETRORIO ON NM will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
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.
Stagnating economy with rate increase
– PETRORIO ON NM 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 Oil & Gas - Integrated industry.
Regulatory challenges
– PETRORIO ON NM 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 Oil & Gas - Integrated industry regulations.
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 PETRORIO ON NM in the Oil & Gas - Integrated sector and impact the bottomline of the organization.
Weighted SWOT Analysis of PETRORIO ON NM Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at PETRORIO ON NM needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of PETRORIO ON NM is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of PETRORIO ON NM is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of PETRORIO ON NM to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that PETRORIO ON NM needs to make to build a sustainable competitive advantage.