Ferrovia Centro Atlantica (VSPT3) SWOT Analysis / TOWS Matrix / MBA Resources
Railroads
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Ferrovia Centro Atlantica (Brazil)
Based on various researches at Oak Spring University , Ferrovia Centro Atlantica is operating in a macro-environment that has been destablized by – technology disruption, increasing household debt because of falling income levels, supply chains are disrupted by pandemic , increasing transportation and logistics costs, talent flight as more people leaving formal jobs, competitive advantages are harder to sustain because of technology dispersion, customer relationship management is fast transforming because of increasing concerns over data privacy,
increasing government debt because of Covid-19 spendings, increasing energy prices, etc
Introduction to SWOT Analysis of Ferrovia Centro Atlantica
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Ferrovia Centro Atlantica can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Ferrovia Centro Atlantica, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Ferrovia Centro Atlantica 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 Ferrovia Centro Atlantica can be done for the following purposes –
1. Strategic planning of Ferrovia Centro Atlantica
2. Improving business portfolio management of Ferrovia Centro Atlantica
3. Assessing feasibility of the new initiative in Brazil
4. Making a Railroads sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Ferrovia Centro Atlantica
Strengths of Ferrovia Centro Atlantica | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Ferrovia Centro Atlantica are -
Learning organization
- Ferrovia Centro Atlantica 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 Ferrovia Centro Atlantica is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Ferrovia Centro Atlantica emphasize – knowledge, initiative, and innovation.
Superior customer experience
– The customer experience strategy of Ferrovia Centro Atlantica in Railroads 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 Railroads industry
– Ferrovia Centro Atlantica is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Low bargaining power of suppliers
– Suppliers of Ferrovia Centro Atlantica in the Transportation sector have low bargaining power. Ferrovia Centro Atlantica has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Ferrovia Centro Atlantica to manage not only supply disruptions but also source products at highly competitive prices.
High brand equity
– Ferrovia Centro Atlantica has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Ferrovia Centro Atlantica to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Cross disciplinary teams
– Horizontal connected teams at the Ferrovia Centro Atlantica 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.
Ability to recruit top talent
– Ferrovia Centro Atlantica is one of the leading players in the Railroads 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.
Effective Research and Development (R&D)
– Ferrovia Centro Atlantica has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Ferrovia Centro Atlantica staying ahead in the Railroads industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High switching costs
– The high switching costs that Ferrovia Centro Atlantica 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.
Diverse revenue streams
– Ferrovia Centro Atlantica is present in almost all the verticals within the Railroads industry. This has provided Ferrovia Centro Atlantica 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.
Digital Transformation in Railroads industry
- digital transformation varies from industry to industry. For Ferrovia Centro Atlantica digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Ferrovia Centro Atlantica 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.
Operational resilience
– The operational resilience strategy of Ferrovia Centro Atlantica comprises – understanding the underlying the factors in the Railroads 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.
Weaknesses of Ferrovia Centro Atlantica | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Ferrovia Centro Atlantica are -
Interest costs
– Compare to the competition, Ferrovia Centro Atlantica 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.
Products dominated business model
– Even though Ferrovia Centro Atlantica has some of the most successful models in the Railroads industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Ferrovia Centro Atlantica should strive to include more intangible value offerings along with its core products and services.
No frontier risks strategy
– From the 10K / annual statement of Ferrovia Centro Atlantica, it seems that company is thinking out the frontier risks that can impact Railroads industry. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Skills based hiring in Railroads industry
– The stress on hiring functional specialists at Ferrovia Centro Atlantica 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.
Capital Spending Reduction
– Even during the low interest decade, Ferrovia Centro Atlantica 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 Railroads industry using digital technology.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Ferrovia Centro Atlantica is slow explore the new channels of communication. These new channels of communication can help Ferrovia Centro Atlantica to provide better information regarding Railroads products and services. It can also build an online community to further reach out to potential customers.
High bargaining power of channel partners in Railroads industry
– because of the regulatory requirements in Brazil, Ferrovia Centro Atlantica 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 Railroads industry.
Employees’ less understanding of Ferrovia Centro Atlantica strategy
– From the outside it seems that the employees of Ferrovia Centro Atlantica 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.
Increasing silos among functional specialists
– The organizational structure of Ferrovia Centro Atlantica is dominated by functional specialists. It is not different from other players in the Railroads industry, but Ferrovia Centro Atlantica needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Ferrovia Centro Atlantica to focus more on services in the Railroads industry rather than just following the product oriented approach.
Ability to respond to the competition
– As the decision making is very deliberative at Ferrovia Centro Atlantica, in the dynamic environment of Railroads industry it has struggled to respond to the nimble upstart competition. Ferrovia Centro Atlantica has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Low market penetration in new markets
– Outside its home market of Brazil, Ferrovia Centro Atlantica needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Ferrovia Centro Atlantica Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Ferrovia Centro Atlantica are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Ferrovia Centro Atlantica 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 Ferrovia Centro Atlantica to hire the very best people irrespective of their geographical location.
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. Ferrovia Centro Atlantica can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Manufacturing automation
– Ferrovia Centro Atlantica can use the latest technology developments to improve its manufacturing and designing process in Railroads 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.
Developing new processes and practices
– Ferrovia Centro Atlantica can develop new processes and procedures in Railroads 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Ferrovia Centro Atlantica can use these opportunities to build new business models that can help the communities that Ferrovia Centro Atlantica operates in. Secondly it can use opportunities from government spending in Railroads sector.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Ferrovia Centro Atlantica 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 Ferrovia Centro Atlantica to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Using analytics as competitive advantage
– Ferrovia Centro Atlantica has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Railroads sector. This continuous investment in analytics has enabled Ferrovia Centro Atlantica to build a competitive advantage using analytics. The analytics driven competitive advantage can help Ferrovia Centro Atlantica to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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 Ferrovia Centro Atlantica 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Railroads industry, but it has also influenced the consumer preferences. Ferrovia Centro Atlantica can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Learning at scale
– Online learning technologies has now opened space for Ferrovia Centro Atlantica 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.
Leveraging digital technologies
– Ferrovia Centro Atlantica 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, Ferrovia Centro Atlantica is facing challenges because of the dominance of functional experts in the organization. Ferrovia Centro Atlantica can utilize new technology in the field of Railroads industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Buying journey improvements
– Ferrovia Centro Atlantica can improve the customer journey of consumers in the Railroads 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.
Threats Ferrovia Centro Atlantica External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Ferrovia Centro Atlantica are -
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 Ferrovia Centro Atlantica business can come under increasing regulations regarding data privacy, data security, etc.
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 Ferrovia Centro Atlantica in the Railroads sector and impact the bottomline of the organization.
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. Ferrovia Centro Atlantica needs to understand the core reasons impacting the Railroads industry. This will help it in building a better workplace.
Environmental challenges
– Ferrovia Centro Atlantica 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. Ferrovia Centro Atlantica can take advantage of this fund but it will also bring new competitors in the Railroads industry.
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 Ferrovia Centro Atlantica.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Ferrovia Centro Atlantica in Railroads industry. The Railroads 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.
Shortening product life cycle
– it is one of the major threat that Ferrovia Centro Atlantica is facing in Railroads sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Ferrovia Centro Atlantica 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 Ferrovia Centro Atlantica prominent markets.
Stagnating economy with rate increase
– Ferrovia Centro Atlantica 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 Railroads industry.
Increasing wage structure of Ferrovia Centro Atlantica
– 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 Ferrovia Centro Atlantica.
High dependence on third party suppliers
– Ferrovia Centro Atlantica 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.
Consumer confidence and its impact on Ferrovia Centro Atlantica 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 Railroads industry and other sectors.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Weighted SWOT Analysis of Ferrovia Centro Atlantica Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Ferrovia Centro Atlantica 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 Ferrovia Centro Atlantica 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 Ferrovia Centro Atlantica 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 Ferrovia Centro Atlantica 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 Ferrovia Centro Atlantica needs to make to build a sustainable competitive advantage.
