SWOT Analysis / TOWS Matrix for Companhia Melhoramentos (Brazil)
Based on various researches at Oak Spring University , Companhia Melhoramentos is operating in a macro-environment that has been destablized by – increasing government debt because of Covid-19 spendings, cloud computing is disrupting traditional business models, technology disruption, there is backlash against globalization, increasing transportation and logistics costs, supply chains are disrupted by pandemic , talent flight as more people leaving formal jobs,
geopolitical disruptions, banking and financial system is disrupted by Bitcoin and other crypto currencies, etc
Introduction to SWOT Analysis of Companhia Melhoramentos
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Companhia Melhoramentos can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Companhia Melhoramentos, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Companhia Melhoramentos 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 Companhia Melhoramentos can be done for the following purposes –
1. Strategic planning of Companhia Melhoramentos
2. Improving business portfolio management of Companhia Melhoramentos
3. Assessing feasibility of the new initiative in Brazil
4. Making a Printing & Publishing sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Companhia Melhoramentos
Strengths of Companhia Melhoramentos | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Companhia Melhoramentos are -
Strong track record of project management in the Printing & Publishing industry
– Companhia Melhoramentos is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Organizational Resilience of Companhia Melhoramentos
– The covid-19 pandemic has put organizational resilience at the centre of everthing Companhia Melhoramentos does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Digital Transformation in Printing & Publishing industry
- digital transformation varies from industry to industry. For Companhia Melhoramentos digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Companhia Melhoramentos has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
High switching costs
– The high switching costs that Companhia Melhoramentos 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.
- Companhia Melhoramentos 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 Companhia Melhoramentos is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Companhia Melhoramentos emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– Companhia Melhoramentos is one of the leading players in the Printing & Publishing 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.
Highly skilled collaborators
– Companhia Melhoramentos has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Printing & Publishing industry. Secondly the value chain collaborators of Companhia Melhoramentos have helped the firm to develop new products and bring them quickly to the marketplace.
Effective Research and Development (R&D)
– Companhia Melhoramentos has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Companhia Melhoramentos staying ahead in the Printing & Publishing industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Low bargaining power of suppliers
– Suppliers of Companhia Melhoramentos in the Services sector have low bargaining power. Companhia Melhoramentos has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Companhia Melhoramentos to manage not only supply disruptions but also source products at highly competitive prices.
Sustainable margins compare to other players in Printing & Publishing industry
– Companhia Melhoramentos has clearly differentiated products in the market place. This has enabled Companhia Melhoramentos to fetch slight price premium compare to the competitors in the Printing & Publishing industry. The sustainable margins have also helped Companhia Melhoramentos to invest into research and development (R&D) and innovation.
Diverse revenue streams
– Companhia Melhoramentos is present in almost all the verticals within the Printing & Publishing industry. This has provided Companhia Melhoramentos 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.
Successful track record of launching new products
– Companhia Melhoramentos has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Companhia Melhoramentos 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.
Weaknesses of Companhia Melhoramentos | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Companhia Melhoramentos are -
High bargaining power of channel partners in Printing & Publishing industry
– because of the regulatory requirements in Brazil, Companhia Melhoramentos 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 Printing & Publishing industry.
High dependence on Companhia Melhoramentos ‘s star products
– The top 2 products and services of Companhia Melhoramentos still accounts for major business revenue. This dependence on star products in Printing & Publishing industry has resulted into insufficient focus on developing new products, even though Companhia Melhoramentos has relatively successful track record of launching new products.
High operating costs
– Compare to the competitors, Companhia Melhoramentos has high operating costs in the Printing & Publishing industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Companhia Melhoramentos lucrative customers.
Products dominated business model
– Even though Companhia Melhoramentos has some of the most successful models in the Printing & Publishing industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Companhia Melhoramentos should strive to include more intangible value offerings along with its core products and services.
Low market penetration in new markets
– Outside its home market of Brazil, Companhia Melhoramentos 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, Companhia Melhoramentos is slow explore the new channels of communication. These new channels of communication can help Companhia Melhoramentos to provide better information regarding Printing & Publishing products and services. It can also build an online community to further reach out to potential customers.
Need for greater diversity
– Companhia Melhoramentos 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.
Skills based hiring in Printing & Publishing industry
– The stress on hiring functional specialists at Companhia Melhoramentos 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, Companhia Melhoramentos 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 Printing & Publishing industry using digital technology.
Aligning sales with marketing
– From the outside it seems that Companhia Melhoramentos needs to have more collaboration between its sales team and marketing team. Sales professionals in the Printing & Publishing industry have deep experience in developing customer relationships. Marketing department at Companhia Melhoramentos can leverage the sales team experience to cultivate customer relationships as Companhia Melhoramentos is planning to shift buying processes online.
Ability to respond to the competition
– As the decision making is very deliberative at Companhia Melhoramentos, in the dynamic environment of Printing & Publishing industry it has struggled to respond to the nimble upstart competition. Companhia Melhoramentos has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Companhia Melhoramentos Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Companhia Melhoramentos are -
Developing new processes and practices
– Companhia Melhoramentos can develop new processes and procedures in Printing & Publishing 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.
Learning at scale
– Online learning technologies has now opened space for Companhia Melhoramentos 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Companhia Melhoramentos 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 Companhia Melhoramentos to hire the very best people irrespective of their geographical location.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Companhia Melhoramentos can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Creating value in data economy
– The success of analytics program of Companhia Melhoramentos has opened avenues for new revenue streams for the organization in Printing & Publishing industry. This can help Companhia Melhoramentos to build a more holistic ecosystem for Companhia Melhoramentos products in the Printing & Publishing industry by providing – data insight services, data privacy related products, data based consulting services, etc.
– Companhia Melhoramentos 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Companhia Melhoramentos 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.
Leveraging digital technologies
– Companhia Melhoramentos can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Building a culture of innovation
– managers at Companhia Melhoramentos 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 Printing & Publishing industry.
Buying journey improvements
– Companhia Melhoramentos can improve the customer journey of consumers in the Printing & Publishing 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.
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 Companhia Melhoramentos 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.
– Companhia Melhoramentos can use the latest technology developments to improve its manufacturing and designing process in Printing & Publishing 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Printing & Publishing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Companhia Melhoramentos can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Companhia Melhoramentos can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Threats Companhia Melhoramentos External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Companhia Melhoramentos are -
Increasing wage structure of Companhia Melhoramentos
– 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 Companhia Melhoramentos.
– Companhia Melhoramentos 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 Printing & Publishing industry regulations.
Technology acceleration in Forth Industrial Revolution
– Companhia Melhoramentos has witnessed rapid integration of technology during Covid-19 in the Printing & Publishing industry. As one of the leading players in the industry, Companhia Melhoramentos needs to keep up with the evolution of technology in the Printing & Publishing 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Companhia Melhoramentos 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 Companhia Melhoramentos prominent markets.
– 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 Companhia Melhoramentos in the Printing & Publishing sector and impact the bottomline of the organization.
Stagnating economy with rate increase
– Companhia Melhoramentos 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 Printing & Publishing 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. Companhia Melhoramentos 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.
– Companhia Melhoramentos 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. Companhia Melhoramentos can take advantage of this fund but it will also bring new competitors in the Printing & Publishing industry.
– 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.
Shortening product life cycle
– it is one of the major threat that Companhia Melhoramentos is facing in Printing & Publishing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Companhia Melhoramentos.
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. Companhia Melhoramentos needs to understand the core reasons impacting the Printing & Publishing industry. This will help it in building a better workplace.
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 Companhia Melhoramentos business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of Companhia Melhoramentos Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Companhia Melhoramentos 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 Companhia Melhoramentos 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 Companhia Melhoramentos 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 Companhia Melhoramentos 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 Companhia Melhoramentos needs to make to build a sustainable competitive advantage.