FII S F LIMA (FLMA11) SWOT Analysis / TOWS Matrix / MBA Resources
NA
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for FII S F LIMA (Brazil)
Based on various researches at Oak Spring University , FII S F LIMA is operating in a macro-environment that has been destablized by – increasing commodity prices, digital marketing is dominated by two big players Facebook and Google, wage bills are increasing, there is backlash against globalization, increasing household debt because of falling income levels, there is increasing trade war between United States & China, customer relationship management is fast transforming because of increasing concerns over data privacy,
central banks are concerned over increasing inflation, increasing government debt because of Covid-19 spendings, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that FII S F LIMA can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the FII S F LIMA, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which FII S F LIMA 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 FII S F LIMA can be done for the following purposes –
1. Strategic planning of FII S F LIMA
2. Improving business portfolio management of FII S F LIMA
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 FII S F LIMA
Strengths of FII S F LIMA | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of FII S F LIMA are -
Successful track record of launching new products
– FII S F LIMA has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. FII S F LIMA 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 brand equity
– FII S F LIMA has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled FII S F LIMA to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Organizational Resilience of FII S F LIMA
– The covid-19 pandemic has put organizational resilience at the centre of everthing FII S F LIMA does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High switching costs
– The high switching costs that FII S F LIMA 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.
Effective Research and Development (R&D)
– FII S F LIMA has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – FII S F LIMA 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.
Sustainable margins compare to other players in NA industry
– FII S F LIMA has clearly differentiated products in the market place. This has enabled FII S F LIMA to fetch slight price premium compare to the competitors in the NA industry. The sustainable margins have also helped FII S F LIMA to invest into research and development (R&D) and innovation.
Low bargaining power of suppliers
– Suppliers of FII S F LIMA in the NA sector have low bargaining power. FII S F LIMA has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps FII S F LIMA to manage not only supply disruptions but also source products at highly competitive prices.
Cross disciplinary teams
– Horizontal connected teams at the FII S F LIMA 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
- FII S F LIMA 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 FII S F LIMA is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at FII S F LIMA emphasize – knowledge, initiative, and innovation.
Superior customer experience
– The customer experience strategy of FII S F LIMA in NA industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Diverse revenue streams
– FII S F LIMA is present in almost all the verticals within the NA industry. This has provided FII S F LIMA a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Training and development
– FII S F LIMA 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.
Weaknesses of FII S F LIMA | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of FII S F LIMA are -
Slow to strategic competitive environment developments
– As FII S F LIMA 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.
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 FII S F LIMA supply chain. Even after few cautionary changes, FII S F LIMA is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left FII S F LIMA vulnerable to further global disruptions in South East Asia.
Skills based hiring in NA industry
– The stress on hiring functional specialists at FII S F LIMA 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.
Ability to respond to the competition
– As the decision making is very deliberative at FII S F LIMA, in the dynamic environment of NA industry it has struggled to respond to the nimble upstart competition. FII S F LIMA has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Low market penetration in new markets
– Outside its home market of Brazil, FII S F LIMA needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, FII S F LIMA is slow explore the new channels of communication. These new channels of communication can help FII S F LIMA to provide better information regarding NA products and services. It can also build an online community to further reach out to potential customers.
Lack of clear differentiation of FII S F LIMA products
– To increase the profitability and margins on the products, FII S F LIMA needs to provide more differentiated products than what it is currently offering in the marketplace.
Workers concerns about automation
– As automation is fast increasing in the NA industry, FII S F LIMA 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.
Need for greater diversity
– FII S F LIMA 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 operating costs
– Compare to the competitors, FII S F LIMA 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 FII S F LIMA lucrative customers.
Increasing silos among functional specialists
– The organizational structure of FII S F LIMA is dominated by functional specialists. It is not different from other players in the NA industry, but FII S F LIMA needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help FII S F LIMA to focus more on services in the NA industry rather than just following the product oriented approach.
FII S F LIMA Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of FII S F LIMA are -
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the NA industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. FII S F LIMA can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. FII S F LIMA can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
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 FII S F LIMA in the NA industry. Now FII S F LIMA can target international markets with far fewer capital restrictions requirements than the existing system.
Lowering marketing communication costs
– 5G expansion will open new opportunities for FII S F LIMA 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.
Buying journey improvements
– FII S F LIMA can improve the customer journey of consumers in the NA 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, FII S F LIMA can use these opportunities to build new business models that can help the communities that FII S F LIMA operates in. Secondly it can use opportunities from government spending in NA sector.
Manufacturing automation
– FII S F LIMA can use the latest technology developments to improve its manufacturing and designing process in NA 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for FII S F LIMA 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 FII S F LIMA to hire the very best people irrespective of their geographical location.
Building a culture of innovation
– managers at FII S F LIMA 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.
Developing new processes and practices
– FII S F LIMA 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 FII S F LIMA can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Learning at scale
– Online learning technologies has now opened space for FII S F LIMA 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.
Creating value in data economy
– The success of analytics program of FII S F LIMA has opened avenues for new revenue streams for the organization in NA industry. This can help FII S F LIMA to build a more holistic ecosystem for FII S F LIMA products in the NA industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Better consumer reach
– The expansion of the 5G network will help FII S F LIMA to increase its market reach. FII S F LIMA 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 FII S F LIMA External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of FII S F LIMA are -
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. FII S F LIMA 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.
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 FII S F LIMA business can come under increasing regulations regarding data privacy, data security, etc.
Shortening product life cycle
– it is one of the major threat that FII S F LIMA is facing in NA sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, 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.
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. FII S F LIMA needs to understand the core reasons impacting the NA industry. This will help it in building a better workplace.
Stagnating economy with rate increase
– FII S F LIMA 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.
Environmental challenges
– FII S F LIMA 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. FII S F LIMA can take advantage of this fund but it will also bring new competitors in the NA industry.
Increasing wage structure of FII S F LIMA
– 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 FII S F LIMA.
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 FII S F LIMA.
Technology acceleration in Forth Industrial Revolution
– FII S F LIMA has witnessed rapid integration of technology during Covid-19 in the NA industry. As one of the leading players in the industry, FII S F LIMA 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.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to NA industry are lowering. It can presents FII S F LIMA with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the NA sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, FII S F LIMA 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 FII S F LIMA prominent markets.
Weighted SWOT Analysis of FII S F LIMA Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at FII S F LIMA 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 FII S F LIMA 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 FII S F LIMA 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 FII S F LIMA 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 FII S F LIMA needs to make to build a sustainable competitive advantage.