Gradiente Electronica SA (IGBR3) SWOT Analysis / TOWS Matrix / MBA Resources
Audio & Video Equipment
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Gradiente Electronica SA (Brazil)
Based on various researches at Oak Spring University , Gradiente Electronica SA is operating in a macro-environment that has been destablized by – increasing government debt because of Covid-19 spendings, central banks are concerned over increasing inflation, wage bills are increasing, technology disruption, increasing commodity prices, banking and financial system is disrupted by Bitcoin and other crypto currencies, there is increasing trade war between United States & China,
increasing energy prices, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of Gradiente Electronica SA
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Gradiente Electronica SA can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Gradiente Electronica SA, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Gradiente Electronica SA 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 Gradiente Electronica SA can be done for the following purposes –
1. Strategic planning of Gradiente Electronica SA
2. Improving business portfolio management of Gradiente Electronica SA
3. Assessing feasibility of the new initiative in Brazil
4. Making a Audio & Video Equipment sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Gradiente Electronica SA
Strengths of Gradiente Electronica SA | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Gradiente Electronica SA are -
Effective Research and Development (R&D)
– Gradiente Electronica SA has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Gradiente Electronica SA staying ahead in the Audio & Video Equipment industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Digital Transformation in Audio & Video Equipment industry
- digital transformation varies from industry to industry. For Gradiente Electronica SA digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Gradiente Electronica SA 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.
Superior customer experience
– The customer experience strategy of Gradiente Electronica SA in Audio & Video Equipment industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to lead change in Audio & Video Equipment
– Gradiente Electronica SA is one of the leading players in the Audio & Video Equipment industry in Brazil. Over the years it has not only transformed the business landscape in the Audio & Video Equipment industry in Brazil but also across the existing markets. The ability to lead change has enabled Gradiente Electronica SA in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Successful track record of launching new products
– Gradiente Electronica SA has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Gradiente Electronica SA 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.
High switching costs
– The high switching costs that Gradiente Electronica SA 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.
Cross disciplinary teams
– Horizontal connected teams at the Gradiente Electronica SA 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.
Analytics focus
– Gradiente Electronica SA 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 Audio & Video Equipment 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.
Innovation driven organization
– Gradiente Electronica SA is one of the most innovative firm in Audio & Video Equipment sector.
Low bargaining power of suppliers
– Suppliers of Gradiente Electronica SA in the Consumer Cyclical sector have low bargaining power. Gradiente Electronica SA has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Gradiente Electronica SA to manage not only supply disruptions but also source products at highly competitive prices.
Sustainable margins compare to other players in Audio & Video Equipment industry
– Gradiente Electronica SA has clearly differentiated products in the market place. This has enabled Gradiente Electronica SA to fetch slight price premium compare to the competitors in the Audio & Video Equipment industry. The sustainable margins have also helped Gradiente Electronica SA to invest into research and development (R&D) and innovation.
Operational resilience
– The operational resilience strategy of Gradiente Electronica SA comprises – understanding the underlying the factors in the Audio & Video Equipment 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 Gradiente Electronica SA | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Gradiente Electronica SA are -
Ability to respond to the competition
– As the decision making is very deliberative at Gradiente Electronica SA, in the dynamic environment of Audio & Video Equipment industry it has struggled to respond to the nimble upstart competition. Gradiente Electronica SA has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Need for greater diversity
– Gradiente Electronica SA 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.
High bargaining power of channel partners in Audio & Video Equipment industry
– because of the regulatory requirements in Brazil, Gradiente Electronica SA 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 Audio & Video Equipment industry.
Slow to strategic competitive environment developments
– As Gradiente Electronica SA is one of the leading players in the Audio & Video Equipment industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Audio & Video Equipment industry in last five years.
Workers concerns about automation
– As automation is fast increasing in the Audio & Video Equipment industry, Gradiente Electronica SA 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.
Lack of clear differentiation of Gradiente Electronica SA products
– To increase the profitability and margins on the products, Gradiente Electronica SA needs to provide more differentiated products than what it is currently offering in the marketplace.
Compensation and incentives
– The revenue per employee of Gradiente Electronica SA is just above the Audio & Video Equipment 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.
Low market penetration in new markets
– Outside its home market of Brazil, Gradiente Electronica SA needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Increasing silos among functional specialists
– The organizational structure of Gradiente Electronica SA is dominated by functional specialists. It is not different from other players in the Audio & Video Equipment industry, but Gradiente Electronica SA needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Gradiente Electronica SA to focus more on services in the Audio & Video Equipment industry rather than just following the product oriented approach.
High operating costs
– Compare to the competitors, Gradiente Electronica SA has high operating costs in the Audio & Video Equipment industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Gradiente Electronica SA lucrative customers.
Aligning sales with marketing
– From the outside it seems that Gradiente Electronica SA needs to have more collaboration between its sales team and marketing team. Sales professionals in the Audio & Video Equipment industry have deep experience in developing customer relationships. Marketing department at Gradiente Electronica SA can leverage the sales team experience to cultivate customer relationships as Gradiente Electronica SA is planning to shift buying processes online.
Gradiente Electronica SA Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Gradiente Electronica SA are -
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Gradiente Electronica SA can use these opportunities to build new business models that can help the communities that Gradiente Electronica SA operates in. Secondly it can use opportunities from government spending in Audio & Video Equipment sector.
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 Gradiente Electronica SA 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.
Manufacturing automation
– Gradiente Electronica SA can use the latest technology developments to improve its manufacturing and designing process in Audio & Video Equipment 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.
Loyalty marketing
– Gradiente Electronica SA 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.
Developing new processes and practices
– Gradiente Electronica SA can develop new processes and procedures in Audio & Video Equipment 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Gradiente Electronica SA 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 Gradiente Electronica SA to hire the very best people irrespective of their geographical location.
Low interest rates
– Even though inflation is raising its head in most developed economies, Gradiente Electronica SA 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.
Creating value in data economy
– The success of analytics program of Gradiente Electronica SA has opened avenues for new revenue streams for the organization in Audio & Video Equipment industry. This can help Gradiente Electronica SA to build a more holistic ecosystem for Gradiente Electronica SA products in the Audio & Video Equipment industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Gradiente Electronica SA can improve the customer journey of consumers in the Audio & Video Equipment 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.
Learning at scale
– Online learning technologies has now opened space for Gradiente Electronica SA 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.
Building a culture of innovation
– managers at Gradiente Electronica SA 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 Audio & Video Equipment industry.
Using analytics as competitive advantage
– Gradiente Electronica SA has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Audio & Video Equipment sector. This continuous investment in analytics has enabled Gradiente Electronica SA to build a competitive advantage using analytics. The analytics driven competitive advantage can help Gradiente Electronica SA to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Better consumer reach
– The expansion of the 5G network will help Gradiente Electronica SA to increase its market reach. Gradiente Electronica SA will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Threats Gradiente Electronica SA External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Gradiente Electronica SA are -
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 Gradiente Electronica SA.
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. Gradiente Electronica SA needs to understand the core reasons impacting the Audio & Video Equipment 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 Gradiente Electronica SA business can come under increasing regulations regarding data privacy, data security, etc.
Increasing wage structure of Gradiente Electronica SA
– 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 Gradiente Electronica SA.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Gradiente Electronica SA in Audio & Video Equipment industry. The Audio & Video Equipment 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.
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.
High dependence on third party suppliers
– Gradiente Electronica SA 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.
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 Gradiente Electronica SA in the Audio & Video Equipment sector and impact the bottomline of the organization.
Regulatory challenges
– Gradiente Electronica SA 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 Audio & Video Equipment industry regulations.
Shortening product life cycle
– it is one of the major threat that Gradiente Electronica SA is facing in Audio & Video Equipment sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Gradiente Electronica SA may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Audio & Video Equipment sector.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Audio & Video Equipment industry are lowering. It can presents Gradiente Electronica SA with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Audio & Video Equipment sector.
Weighted SWOT Analysis of Gradiente Electronica SA Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Gradiente Electronica SA 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 Gradiente Electronica SA 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 Gradiente Electronica SA 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 Gradiente Electronica SA 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 Gradiente Electronica SA needs to make to build a sustainable competitive advantage.