SWOT Analysis / TOWS Matrix for Santanense Pref (Brazil)
Based on various researches at Oak Spring University , Santanense Pref is operating in a macro-environment that has been destablized by – increasing government debt because of Covid-19 spendings, technology disruption, increasing transportation and logistics costs, there is increasing trade war between United States & China, increasing household debt because of falling income levels, geopolitical disruptions, customer relationship management is fast transforming because of increasing concerns over data privacy,
cloud computing is disrupting traditional business models, challanges to central banks by blockchain based private currencies, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Santanense Pref can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Santanense Pref, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Santanense 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.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Santanense Pref can be done for the following purposes –
1. Strategic planning of Santanense Pref
2. Improving business portfolio management of Santanense Pref
3. Assessing feasibility of the new initiative in Brazil
4. Making a Textiles - Non Apparel sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Santanense Pref
Strengths of Santanense Pref | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Santanense Pref are -
Learning organization
- Santanense Pref 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 Santanense Pref is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Santanense Pref emphasize – knowledge, initiative, and innovation.
Analytics focus
– Santanense Pref 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 Textiles - Non Apparel 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.
Digital Transformation in Textiles - Non Apparel industry
- digital transformation varies from industry to industry. For Santanense Pref digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Santanense 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.
Successful track record of launching new products
– Santanense Pref has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Santanense 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.
Diverse revenue streams
– Santanense Pref is present in almost all the verticals within the Textiles - Non Apparel industry. This has provided Santanense 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.
Training and development
– Santanense Pref has one of the best training and development program in Consumer Cyclical 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.
High switching costs
– The high switching costs that Santanense 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.
Innovation driven organization
– Santanense Pref is one of the most innovative firm in Textiles - Non Apparel sector.
Low bargaining power of suppliers
– Suppliers of Santanense Pref in the Consumer Cyclical sector have low bargaining power. Santanense Pref has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Santanense Pref to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Santanense Pref in Textiles - Non Apparel industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the Santanense Pref 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.
Operational resilience
– The operational resilience strategy of Santanense Pref comprises – understanding the underlying the factors in the Textiles - Non Apparel 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 Santanense Pref | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Santanense Pref are -
Capital Spending Reduction
– Even during the low interest decade, Santanense 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 Textiles - Non Apparel industry using digital technology.
Lack of clear differentiation of Santanense Pref products
– To increase the profitability and margins on the products, Santanense Pref needs to provide more differentiated products than what it is currently offering in the marketplace.
Compensation and incentives
– The revenue per employee of Santanense Pref is just above the Textiles - Non Apparel 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.
Products dominated business model
– Even though Santanense Pref has some of the most successful models in the Textiles - Non Apparel industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Santanense Pref should strive to include more intangible value offerings along with its core products and services.
Skills based hiring in Textiles - Non Apparel industry
– The stress on hiring functional specialists at Santanense Pref 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.
High cash cycle compare to competitors
Santanense Pref has a high cash cycle compare to other players in the Textiles - Non Apparel industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Workers concerns about automation
– As automation is fast increasing in the Textiles - Non Apparel industry, Santanense 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.
Aligning sales with marketing
– From the outside it seems that Santanense Pref needs to have more collaboration between its sales team and marketing team. Sales professionals in the Textiles - Non Apparel industry have deep experience in developing customer relationships. Marketing department at Santanense Pref can leverage the sales team experience to cultivate customer relationships as Santanense Pref is planning to shift buying processes online.
Slow decision making process
– As mentioned earlier in the report, Santanense Pref has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Textiles - Non Apparel industry over the last five years. Santanense Pref even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Ability to respond to the competition
– As the decision making is very deliberative at Santanense Pref, in the dynamic environment of Textiles - Non Apparel industry it has struggled to respond to the nimble upstart competition. Santanense Pref has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Increasing silos among functional specialists
– The organizational structure of Santanense Pref is dominated by functional specialists. It is not different from other players in the Textiles - Non Apparel industry, but Santanense Pref needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Santanense Pref to focus more on services in the Textiles - Non Apparel industry rather than just following the product oriented approach.
Santanense Pref Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Santanense Pref are -
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Textiles - Non Apparel industry, but it has also influenced the consumer preferences. Santanense Pref can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Santanense Pref is facing challenges because of the dominance of functional experts in the organization. Santanense Pref can utilize new technology in the field of Textiles - Non Apparel industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Use of Bitcoin and other crypto currencies for transactions in Textiles - Non Apparel industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Santanense Pref in the Textiles - Non Apparel industry. Now Santanense Pref can target international markets with far fewer capital restrictions requirements than the existing system.
Building a culture of innovation
– managers at Santanense Pref 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 Textiles - Non Apparel industry.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Santanense Pref 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 Santanense Pref to hire the very best people irrespective of their geographical location.
Loyalty marketing
– Santanense 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.
Manufacturing automation
– Santanense Pref can use the latest technology developments to improve its manufacturing and designing process in Textiles - Non Apparel 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Santanense 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.
Leveraging digital technologies
– Santanense Pref 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.
Learning at scale
– Online learning technologies has now opened space for Santanense 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.
Buying journey improvements
– Santanense Pref can improve the customer journey of consumers in the Textiles - Non Apparel 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.
Using analytics as competitive advantage
– Santanense Pref has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Textiles - Non Apparel sector. This continuous investment in analytics has enabled Santanense Pref to build a competitive advantage using analytics. The analytics driven competitive advantage can help Santanense Pref to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Developing new processes and practices
– Santanense Pref can develop new processes and procedures in Textiles - Non Apparel 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.
Threats Santanense Pref External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Santanense Pref are -
Technology acceleration in Forth Industrial Revolution
– Santanense Pref has witnessed rapid integration of technology during Covid-19 in the Textiles - Non Apparel industry. As one of the leading players in the industry, Santanense Pref needs to keep up with the evolution of technology in the Textiles - Non Apparel 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, Santanense 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 Textiles - Non Apparel sector.
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. Santanense Pref 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.
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 Santanense Pref.
Environmental challenges
– Santanense 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. Santanense Pref can take advantage of this fund but it will also bring new competitors in the Textiles - Non Apparel industry.
Stagnating economy with rate increase
– Santanense 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 Textiles - Non Apparel industry.
Consumer confidence and its impact on Santanense 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 Textiles - Non Apparel industry and other sectors.
Increasing wage structure of Santanense Pref
– 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 Santanense Pref.
Easy access to finance
– Easy access to finance in Textiles - Non Apparel industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Santanense Pref 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 Textiles - Non Apparel industry are lowering. It can presents Santanense Pref with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Textiles - Non Apparel sector.
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.
Shortening product life cycle
– it is one of the major threat that Santanense Pref is facing in Textiles - Non Apparel sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Santanense Pref Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Santanense 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 Santanense 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 Santanense 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 Santanense 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 Santanense Pref needs to make to build a sustainable competitive advantage.