Tecnosolo Engenharia SA ON (TCNO3) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Tecnosolo Engenharia SA ON (Brazil)

Based on various researches at Oak Spring University , Tecnosolo Engenharia SA ON is operating in a macro-environment that has been destablized by – technology disruption, competitive advantages are harder to sustain because of technology dispersion, banking and financial system is disrupted by Bitcoin and other crypto currencies, cloud computing is disrupting traditional business models, digital marketing is dominated by two big players Facebook and Google, increasing commodity prices, customer relationship management is fast transforming because of increasing concerns over data privacy, wage bills are increasing, increasing transportation and logistics costs, etc

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Introduction to SWOT Analysis of Tecnosolo Engenharia SA ON

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Tecnosolo Engenharia SA ON can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Tecnosolo Engenharia SA ON, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Tecnosolo Engenharia SA ON 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of Tecnosolo Engenharia SA ON can be done for the following purposes –
1. Strategic planning of Tecnosolo Engenharia SA ON
2. Improving business portfolio management of Tecnosolo Engenharia SA ON
3. Assessing feasibility of the new initiative in Brazil
4. Making a Construction Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Tecnosolo Engenharia SA ON

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Strengths of Tecnosolo Engenharia SA ON | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Tecnosolo Engenharia SA ON are -

Cross disciplinary teams

– Horizontal connected teams at the Tecnosolo Engenharia SA ON 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.

Learning organization

- Tecnosolo Engenharia SA ON 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 Tecnosolo Engenharia SA ON is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Tecnosolo Engenharia SA ON emphasize – knowledge, initiative, and innovation.

High brand equity

– Tecnosolo Engenharia SA ON has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Tecnosolo Engenharia SA ON to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Low bargaining power of suppliers

– Suppliers of Tecnosolo Engenharia SA ON in the Capital Goods sector have low bargaining power. Tecnosolo Engenharia SA ON has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Tecnosolo Engenharia SA ON to manage not only supply disruptions but also source products at highly competitive prices.

Analytics focus

– Tecnosolo Engenharia SA ON 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 Construction Services 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.

High switching costs

– The high switching costs that Tecnosolo Engenharia SA ON 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.

Ability to recruit top talent

– Tecnosolo Engenharia SA ON is one of the leading players in the Construction Services 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.

Operational resilience

– The operational resilience strategy of Tecnosolo Engenharia SA ON comprises – understanding the underlying the factors in the Construction Services 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.

Successful track record of launching new products

– Tecnosolo Engenharia SA ON has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Tecnosolo Engenharia SA ON 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

– Tecnosolo Engenharia SA ON is present in almost all the verticals within the Construction Services industry. This has provided Tecnosolo Engenharia SA ON 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.

Superior customer experience

– The customer experience strategy of Tecnosolo Engenharia SA ON in Construction Services industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Ability to lead change in Construction Services

– Tecnosolo Engenharia SA ON is one of the leading players in the Construction Services industry in Brazil. Over the years it has not only transformed the business landscape in the Construction Services industry in Brazil but also across the existing markets. The ability to lead change has enabled Tecnosolo Engenharia SA ON in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

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Weaknesses of Tecnosolo Engenharia SA ON | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Tecnosolo Engenharia SA ON are -

Skills based hiring in Construction Services industry

– The stress on hiring functional specialists at Tecnosolo Engenharia SA ON has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.

Compensation and incentives

– The revenue per employee of Tecnosolo Engenharia SA ON is just above the Construction Services 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.

Slow to strategic competitive environment developments

– As Tecnosolo Engenharia SA ON is one of the leading players in the Construction Services industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Construction Services industry in last five years.

High dependence on existing supply chain

– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Tecnosolo Engenharia SA ON supply chain. Even after few cautionary changes, Tecnosolo Engenharia SA ON is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Tecnosolo Engenharia SA ON vulnerable to further global disruptions in South East Asia.

Lack of clear differentiation of Tecnosolo Engenharia SA ON products

– To increase the profitability and margins on the products, Tecnosolo Engenharia SA ON needs to provide more differentiated products than what it is currently offering in the marketplace.

Increasing silos among functional specialists

– The organizational structure of Tecnosolo Engenharia SA ON is dominated by functional specialists. It is not different from other players in the Construction Services industry, but Tecnosolo Engenharia SA ON needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Tecnosolo Engenharia SA ON to focus more on services in the Construction Services industry rather than just following the product oriented approach.

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Tecnosolo Engenharia SA ON is slow explore the new channels of communication. These new channels of communication can help Tecnosolo Engenharia SA ON to provide better information regarding Construction Services products and services. It can also build an online community to further reach out to potential customers.

Employees’ less understanding of Tecnosolo Engenharia SA ON strategy

– From the outside it seems that the employees of Tecnosolo Engenharia SA ON 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.

High cash cycle compare to competitors

Tecnosolo Engenharia SA ON has a high cash cycle compare to other players in the Construction Services industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.

Interest costs

– Compare to the competition, Tecnosolo Engenharia SA ON 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.

Need for greater diversity

– Tecnosolo Engenharia SA ON 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.

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Tecnosolo Engenharia SA ON Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of Tecnosolo Engenharia SA ON are -

Finding new ways to collaborate

– Covid-19 has not only transformed business models of companies in Construction Services industry, but it has also influenced the consumer preferences. Tecnosolo Engenharia SA ON can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

Leveraging digital technologies

– Tecnosolo Engenharia SA ON 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.

Creating value in data economy

– The success of analytics program of Tecnosolo Engenharia SA ON has opened avenues for new revenue streams for the organization in Construction Services industry. This can help Tecnosolo Engenharia SA ON to build a more holistic ecosystem for Tecnosolo Engenharia SA ON products in the Construction Services industry by providing – data insight services, data privacy related products, data based consulting services, etc.

Loyalty marketing

– Tecnosolo Engenharia SA ON 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.

Building a culture of innovation

– managers at Tecnosolo Engenharia SA ON 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 Construction Services industry.

Buying journey improvements

– Tecnosolo Engenharia SA ON can improve the customer journey of consumers in the Construction Services 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.

Manufacturing automation

– Tecnosolo Engenharia SA ON can use the latest technology developments to improve its manufacturing and designing process in Construction Services 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.

Using analytics as competitive advantage

– Tecnosolo Engenharia SA ON has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Construction Services sector. This continuous investment in analytics has enabled Tecnosolo Engenharia SA ON to build a competitive advantage using analytics. The analytics driven competitive advantage can help Tecnosolo Engenharia SA ON to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.

Lowering marketing communication costs

– 5G expansion will open new opportunities for Tecnosolo Engenharia SA ON in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Construction Services industry, and it will provide faster access to the consumers.

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 Tecnosolo Engenharia SA ON 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.

Learning at scale

– Online learning technologies has now opened space for Tecnosolo Engenharia SA ON 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.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Tecnosolo Engenharia SA ON can use these opportunities to build new business models that can help the communities that Tecnosolo Engenharia SA ON operates in. Secondly it can use opportunities from government spending in Construction Services sector.

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. Tecnosolo Engenharia SA ON can explore opportunities that can attract volunteers and are consistent with its mission and vision.

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Threats Tecnosolo Engenharia SA ON External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of Tecnosolo Engenharia SA ON are -

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.

Technology acceleration in Forth Industrial Revolution

– Tecnosolo Engenharia SA ON has witnessed rapid integration of technology during Covid-19 in the Construction Services industry. As one of the leading players in the industry, Tecnosolo Engenharia SA ON needs to keep up with the evolution of technology in the Construction Services 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.

High dependence on third party suppliers

– Tecnosolo Engenharia SA ON 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.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, Tecnosolo Engenharia SA ON 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 Tecnosolo Engenharia SA ON prominent markets.

Consumer confidence and its impact on Tecnosolo Engenharia SA ON 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 Construction Services industry and other sectors.

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 Tecnosolo Engenharia SA ON.

Easy access to finance

– Easy access to finance in Construction Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Tecnosolo Engenharia SA ON 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 Construction Services industry are lowering. It can presents Tecnosolo Engenharia SA ON with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Construction Services sector.

Environmental challenges

– Tecnosolo Engenharia SA ON 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. Tecnosolo Engenharia SA ON can take advantage of this fund but it will also bring new competitors in the Construction Services industry.

Increasing wage structure of Tecnosolo Engenharia SA ON

– 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 Tecnosolo Engenharia SA ON.

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. Tecnosolo Engenharia SA ON 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.

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 Tecnosolo Engenharia SA ON in the Construction Services sector and impact the bottomline of the organization.

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Weighted SWOT Analysis of Tecnosolo Engenharia SA ON Template, Example

Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Tecnosolo Engenharia SA ON 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 Tecnosolo Engenharia SA ON 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 Tecnosolo Engenharia SA ON 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 Tecnosolo Engenharia SA ON 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 Tecnosolo Engenharia SA ON needs to make to build a sustainable competitive advantage.

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