Based on various researches at Oak Spring University , Vinci Shopping Centers FII is operating in a macro-environment that has been destablized by – talent flight as more people leaving formal jobs, increasing government debt because of Covid-19 spendings, increasing inequality as vast percentage of new income is going to the top 1%, increasing energy prices, central banks are concerned over increasing inflation, challanges to central banks by blockchain based private currencies, banking and financial system is disrupted by Bitcoin and other crypto currencies,
supply chains are disrupted by pandemic , there is backlash against globalization, etc
Introduction to SWOT Analysis of Vinci Shopping Centers FII
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Vinci Shopping Centers FII can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Vinci Shopping Centers FII, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Vinci Shopping Centers FII 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 Vinci Shopping Centers FII can be done for the following purposes –
1. Strategic planning of Vinci Shopping Centers FII
2. Improving business portfolio management of Vinci Shopping Centers FII
3. Assessing feasibility of the new initiative in Brazil
4. Making a NA sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Vinci Shopping Centers FII
Strengths of Vinci Shopping Centers FII | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Vinci Shopping Centers FII are -
Innovation driven organization
– Vinci Shopping Centers FII is one of the most innovative firm in NA sector.
Training and development
– Vinci Shopping Centers FII has one of the best training and development program in NA 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 Vinci Shopping Centers FII 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.
Learning organization
- Vinci Shopping Centers FII 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 Vinci Shopping Centers FII is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Vinci Shopping Centers FII emphasize – knowledge, initiative, and innovation.
Operational resilience
– The operational resilience strategy of Vinci Shopping Centers FII comprises – understanding the underlying the factors in the NA 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.
High brand equity
– Vinci Shopping Centers FII has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Vinci Shopping Centers FII to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of Vinci Shopping Centers FII in the NA sector have low bargaining power. Vinci Shopping Centers FII has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Vinci Shopping Centers FII to manage not only supply disruptions but also source products at highly competitive prices.
Organizational Resilience of Vinci Shopping Centers FII
– The covid-19 pandemic has put organizational resilience at the centre of everthing Vinci Shopping Centers FII does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Diverse revenue streams
– Vinci Shopping Centers FII is present in almost all the verticals within the NA industry. This has provided Vinci Shopping Centers FII 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.
Highly skilled collaborators
– Vinci Shopping Centers FII has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive NA industry. Secondly the value chain collaborators of Vinci Shopping Centers FII have helped the firm to develop new products and bring them quickly to the marketplace.
Superior customer experience
– The customer experience strategy of Vinci Shopping Centers FII in NA industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Effective Research and Development (R&D)
– Vinci Shopping Centers FII has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Vinci Shopping Centers FII staying ahead in the NA industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses of Vinci Shopping Centers FII | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Vinci Shopping Centers FII are -
Products dominated business model
– Even though Vinci Shopping Centers FII has some of the most successful models in the NA industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Vinci Shopping Centers FII should strive to include more intangible value offerings along with its core products and services.
Slow to strategic competitive environment developments
– As Vinci Shopping Centers FII is one of the leading players in the NA industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the NA industry in last five years.
Slow decision making process
– As mentioned earlier in the report, Vinci Shopping Centers FII has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the NA industry over the last five years. Vinci Shopping Centers FII 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.
Compensation and incentives
– The revenue per employee of Vinci Shopping Centers FII is just above the NA 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.
Workers concerns about automation
– As automation is fast increasing in the NA industry, Vinci Shopping Centers FII 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, Vinci Shopping Centers FII is slow explore the new channels of communication. These new channels of communication can help Vinci Shopping Centers FII to provide better information regarding NA products and services. It can also build an online community to further reach out to potential customers.
High cash cycle compare to competitors
Vinci Shopping Centers FII has a high cash cycle compare to other players in the NA industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Lack of clear differentiation of Vinci Shopping Centers FII products
– To increase the profitability and margins on the products, Vinci Shopping Centers FII needs to provide more differentiated products than what it is currently offering in the marketplace.
No frontier risks strategy
– From the 10K / annual statement of Vinci Shopping Centers FII, it seems that company is thinking out the frontier risks that can impact NA industry. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
High dependence on Vinci Shopping Centers FII ‘s star products
– The top 2 products and services of Vinci Shopping Centers FII still accounts for major business revenue. This dependence on star products in NA industry has resulted into insufficient focus on developing new products, even though Vinci Shopping Centers FII has relatively successful track record of launching new products.
High operating costs
– Compare to the competitors, Vinci Shopping Centers FII has high operating costs in the NA industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Vinci Shopping Centers FII lucrative customers.
Vinci Shopping Centers FII Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Vinci Shopping Centers FII are -
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 Vinci Shopping Centers FII 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 NA industry, but it has also influenced the consumer preferences. Vinci Shopping Centers FII can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Creating value in data economy
– The success of analytics program of Vinci Shopping Centers FII has opened avenues for new revenue streams for the organization in NA industry. This can help Vinci Shopping Centers FII to build a more holistic ecosystem for Vinci Shopping Centers FII products in the NA industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Vinci Shopping Centers FII 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 Vinci Shopping Centers FII to hire the very best people irrespective of their geographical location.
Loyalty marketing
– Vinci Shopping Centers FII 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
– Vinci Shopping Centers FII can develop new processes and procedures in NA 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Vinci Shopping Centers FII can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Vinci Shopping Centers FII is facing challenges because of the dominance of functional experts in the organization. Vinci Shopping Centers FII can utilize new technology in the field of NA industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Better consumer reach
– The expansion of the 5G network will help Vinci Shopping Centers FII to increase its market reach. Vinci Shopping Centers FII 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.
Use of Bitcoin and other crypto currencies for transactions in NA industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Vinci Shopping Centers FII in the NA industry. Now Vinci Shopping Centers FII can target international markets with far fewer capital restrictions requirements than the existing system.
Building a culture of innovation
– managers at Vinci Shopping Centers FII 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 NA industry.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Vinci Shopping Centers FII in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the NA industry, and it will provide faster access to the consumers.
Low interest rates
– Even though inflation is raising its head in most developed economies, Vinci Shopping Centers FII 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.
Threats Vinci Shopping Centers FII External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Vinci Shopping Centers FII are -
Increasing wage structure of Vinci Shopping Centers FII
– 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 Vinci Shopping Centers FII.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to NA industry are lowering. It can presents Vinci Shopping Centers FII with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the NA sector.
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 Vinci Shopping Centers FII.
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 Vinci Shopping Centers FII in the NA sector and impact the bottomline of the organization.
Consumer confidence and its impact on Vinci Shopping Centers FII 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 NA industry and other sectors.
High dependence on third party suppliers
– Vinci Shopping Centers FII 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.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Vinci Shopping Centers FII may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of NA sector.
Stagnating economy with rate increase
– Vinci Shopping Centers FII 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 NA industry.
Technology acceleration in Forth Industrial Revolution
– Vinci Shopping Centers FII has witnessed rapid integration of technology during Covid-19 in the NA industry. As one of the leading players in the industry, Vinci Shopping Centers FII needs to keep up with the evolution of technology in the NA 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 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. Vinci Shopping Centers FII needs to understand the core reasons impacting the NA industry. This will help it in building a better workplace.
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. Vinci Shopping Centers FII 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.
Weighted SWOT Analysis of Vinci Shopping Centers FII Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Vinci Shopping Centers FII 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 Vinci Shopping Centers FII 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 Vinci Shopping Centers FII 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 Vinci Shopping Centers FII 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 Vinci Shopping Centers FII needs to make to build a sustainable competitive advantage.