SWOT Analysis / TOWS Matrix for Cemepe Investimentos (Brazil)
Based on various researches at Oak Spring University , Cemepe Investimentos is operating in a macro-environment that has been destablized by – increasing commodity prices, wage bills are increasing, increasing inequality as vast percentage of new income is going to the top 1%, banking and financial system is disrupted by Bitcoin and other crypto currencies, cloud computing is disrupting traditional business models, technology disruption, customer relationship management is fast transforming because of increasing concerns over data privacy,
there is backlash against globalization, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Cemepe Investimentos
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Cemepe Investimentos can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Cemepe Investimentos, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Cemepe Investimentos 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 Cemepe Investimentos can be done for the following purposes –
1. Strategic planning of Cemepe Investimentos
2. Improving business portfolio management of Cemepe Investimentos
3. Assessing feasibility of the new initiative in Brazil
4. Making a Misc. Financial Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Cemepe Investimentos
Strengths of Cemepe Investimentos | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Cemepe Investimentos are -
Successful track record of launching new products
– Cemepe Investimentos has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Cemepe Investimentos 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.
Low bargaining power of suppliers
– Suppliers of Cemepe Investimentos in the Financial sector have low bargaining power. Cemepe Investimentos has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Cemepe Investimentos to manage not only supply disruptions but also source products at highly competitive prices.
Sustainable margins compare to other players in Misc. Financial Services industry
– Cemepe Investimentos has clearly differentiated products in the market place. This has enabled Cemepe Investimentos to fetch slight price premium compare to the competitors in the Misc. Financial Services industry. The sustainable margins have also helped Cemepe Investimentos to invest into research and development (R&D) and innovation.
Learning organization
- Cemepe Investimentos 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 Cemepe Investimentos is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Cemepe Investimentos emphasize – knowledge, initiative, and innovation.
Organizational Resilience of Cemepe Investimentos
– The covid-19 pandemic has put organizational resilience at the centre of everthing Cemepe Investimentos does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Diverse revenue streams
– Cemepe Investimentos is present in almost all the verticals within the Misc. Financial Services industry. This has provided Cemepe Investimentos 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 Cemepe Investimentos in Misc. Financial Services industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Operational resilience
– The operational resilience strategy of Cemepe Investimentos comprises – understanding the underlying the factors in the Misc. Financial 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.
Ability to lead change in Misc. Financial Services
– Cemepe Investimentos is one of the leading players in the Misc. Financial Services industry in Brazil. Over the years it has not only transformed the business landscape in the Misc. Financial Services industry in Brazil but also across the existing markets. The ability to lead change has enabled Cemepe Investimentos in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Training and development
– Cemepe Investimentos has one of the best training and development program in Financial 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.
Effective Research and Development (R&D)
– Cemepe Investimentos has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Cemepe Investimentos staying ahead in the Misc. Financial Services industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Analytics focus
– Cemepe Investimentos 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 Misc. Financial 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.
Weaknesses of Cemepe Investimentos | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Cemepe Investimentos are -
Capital Spending Reduction
– Even during the low interest decade, Cemepe Investimentos 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 Misc. Financial Services industry using digital technology.
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 Cemepe Investimentos supply chain. Even after few cautionary changes, Cemepe Investimentos is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Cemepe Investimentos vulnerable to further global disruptions in South East Asia.
Slow decision making process
– As mentioned earlier in the report, Cemepe Investimentos has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Misc. Financial Services industry over the last five years. Cemepe Investimentos 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.
Lack of clear differentiation of Cemepe Investimentos products
– To increase the profitability and margins on the products, Cemepe Investimentos needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Cemepe Investimentos has a high cash cycle compare to other players in the Misc. Financial 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.
Increasing silos among functional specialists
– The organizational structure of Cemepe Investimentos is dominated by functional specialists. It is not different from other players in the Misc. Financial Services industry, but Cemepe Investimentos needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Cemepe Investimentos to focus more on services in the Misc. Financial Services industry rather than just following the product oriented approach.
Low market penetration in new markets
– Outside its home market of Brazil, Cemepe Investimentos needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Need for greater diversity
– Cemepe Investimentos 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.
Employees’ less understanding of Cemepe Investimentos strategy
– From the outside it seems that the employees of Cemepe Investimentos 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.
Workers concerns about automation
– As automation is fast increasing in the Misc. Financial Services industry, Cemepe Investimentos 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Cemepe Investimentos is slow explore the new channels of communication. These new channels of communication can help Cemepe Investimentos to provide better information regarding Misc. Financial Services products and services. It can also build an online community to further reach out to potential customers.
Cemepe Investimentos Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Cemepe Investimentos are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Cemepe Investimentos in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Misc. Financial Services industry, and it will provide faster access to the consumers.
Low interest rates
– Even though inflation is raising its head in most developed economies, Cemepe Investimentos 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.
Use of Bitcoin and other crypto currencies for transactions in Misc. Financial Services industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Cemepe Investimentos in the Misc. Financial Services industry. Now Cemepe Investimentos can target international markets with far fewer capital restrictions requirements than the existing system.
Loyalty marketing
– Cemepe Investimentos 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.
Using analytics as competitive advantage
– Cemepe Investimentos has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Misc. Financial Services sector. This continuous investment in analytics has enabled Cemepe Investimentos to build a competitive advantage using analytics. The analytics driven competitive advantage can help Cemepe Investimentos to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Cemepe Investimentos to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Misc. Financial Services industry, but it has also influenced the consumer preferences. Cemepe Investimentos can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Building a culture of innovation
– managers at Cemepe Investimentos 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 Misc. Financial Services industry.
Better consumer reach
– The expansion of the 5G network will help Cemepe Investimentos to increase its market reach. Cemepe Investimentos 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Cemepe Investimentos 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 Cemepe Investimentos to hire the very best people irrespective of their geographical location.
Leveraging digital technologies
– Cemepe Investimentos 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 Cemepe Investimentos 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Cemepe Investimentos can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Cemepe Investimentos External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Cemepe Investimentos are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Cemepe Investimentos in Misc. Financial Services industry. The Misc. Financial Services 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.
Regulatory challenges
– Cemepe Investimentos 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 Misc. Financial Services industry regulations.
Easy access to finance
– Easy access to finance in Misc. Financial Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Cemepe Investimentos can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Stagnating economy with rate increase
– Cemepe Investimentos 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 Misc. Financial Services industry.
Environmental challenges
– Cemepe Investimentos 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. Cemepe Investimentos can take advantage of this fund but it will also bring new competitors in the Misc. Financial Services industry.
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. Cemepe Investimentos needs to understand the core reasons impacting the Misc. Financial Services industry. This will help it in building a better workplace.
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 Cemepe Investimentos.
Shortening product life cycle
– it is one of the major threat that Cemepe Investimentos is facing in Misc. Financial Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Misc. Financial Services industry are lowering. It can presents Cemepe Investimentos with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Misc. Financial Services sector.
Technology acceleration in Forth Industrial Revolution
– Cemepe Investimentos has witnessed rapid integration of technology during Covid-19 in the Misc. Financial Services industry. As one of the leading players in the industry, Cemepe Investimentos needs to keep up with the evolution of technology in the Misc. Financial 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Cemepe Investimentos may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Misc. Financial Services sector.
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 Cemepe Investimentos business can come under increasing regulations regarding data privacy, data security, etc.
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.
Weighted SWOT Analysis of Cemepe Investimentos Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Cemepe Investimentos 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 Cemepe Investimentos 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 Cemepe Investimentos 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 Cemepe Investimentos 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 Cemepe Investimentos needs to make to build a sustainable competitive advantage.