Grupo TMM SAB (GTMAY) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Grupo TMM SAB (United States)

Based on various researches at Oak Spring University , Grupo TMM SAB is operating in a macro-environment that has been destablized by – there is increasing trade war between United States & China, increasing inequality as vast percentage of new income is going to the top 1%, there is backlash against globalization, increasing household debt because of falling income levels, talent flight as more people leaving formal jobs, increasing government debt because of Covid-19 spendings, competitive advantages are harder to sustain because of technology dispersion, geopolitical disruptions, increasing commodity prices, etc

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Introduction to SWOT Analysis of Grupo TMM SAB

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Grupo TMM SAB can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Grupo TMM SAB, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Grupo TMM SAB 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 Grupo TMM SAB can be done for the following purposes –
1. Strategic planning of Grupo TMM SAB
2. Improving business portfolio management of Grupo TMM SAB
3. Assessing feasibility of the new initiative in United States
4. Making a Water Transportation sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Grupo TMM SAB

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Strengths of Grupo TMM SAB | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Grupo TMM SAB are -

Successful track record of launching new products

– Grupo TMM SAB has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Grupo TMM SAB 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

– Grupo TMM SAB has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Grupo TMM SAB to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Diverse revenue streams

– Grupo TMM SAB is present in almost all the verticals within the Water Transportation industry. This has provided Grupo TMM SAB 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.

Learning organization

- Grupo TMM SAB 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 Grupo TMM SAB is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Grupo TMM SAB emphasize – knowledge, initiative, and innovation.

Sustainable margins compare to other players in Water Transportation industry

– Grupo TMM SAB has clearly differentiated products in the market place. This has enabled Grupo TMM SAB to fetch slight price premium compare to the competitors in the Water Transportation industry. The sustainable margins have also helped Grupo TMM SAB to invest into research and development (R&D) and innovation.

High switching costs

– The high switching costs that Grupo TMM SAB 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.

Low bargaining power of suppliers

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

Operational resilience

– The operational resilience strategy of Grupo TMM SAB comprises – understanding the underlying the factors in the Water Transportation 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.

Highly skilled collaborators

– Grupo TMM SAB has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Water Transportation industry. Secondly the value chain collaborators of Grupo TMM SAB have helped the firm to develop new products and bring them quickly to the marketplace.

Organizational Resilience of Grupo TMM SAB

– The covid-19 pandemic has put organizational resilience at the centre of everthing Grupo TMM SAB does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.

Effective Research and Development (R&D)

– Grupo TMM SAB has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Grupo TMM SAB staying ahead in the Water Transportation industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

Innovation driven organization

– Grupo TMM SAB is one of the most innovative firm in Water Transportation sector.

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Weaknesses of Grupo TMM SAB | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Grupo TMM SAB are -

Employees’ less understanding of Grupo TMM SAB strategy

– From the outside it seems that the employees of Grupo TMM SAB 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.

Low market penetration in new markets

– Outside its home market of United States, Grupo TMM SAB needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.

Products dominated business model

– Even though Grupo TMM SAB has some of the most successful models in the Water Transportation industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Grupo TMM SAB should strive to include more intangible value offerings along with its core products and services.

High cash cycle compare to competitors

Grupo TMM SAB has a high cash cycle compare to other players in the Water Transportation industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.

High operating costs

– Compare to the competitors, Grupo TMM SAB has high operating costs in the Water Transportation industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Grupo TMM SAB lucrative customers.

Ability to respond to the competition

– As the decision making is very deliberative at Grupo TMM SAB, in the dynamic environment of Water Transportation industry it has struggled to respond to the nimble upstart competition. Grupo TMM SAB has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

Slow decision making process

– As mentioned earlier in the report, Grupo TMM SAB has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Water Transportation industry over the last five years. Grupo TMM SAB 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.

Increasing silos among functional specialists

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

Slow to strategic competitive environment developments

– As Grupo TMM SAB is one of the leading players in the Water Transportation industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Water Transportation industry in last five years.

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Grupo TMM SAB is slow explore the new channels of communication. These new channels of communication can help Grupo TMM SAB to provide better information regarding Water Transportation products and services. It can also build an online community to further reach out to potential customers.

High bargaining power of channel partners in Water Transportation industry

– because of the regulatory requirements in United States, Grupo TMM SAB 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 Water Transportation industry.

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Grupo TMM SAB Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of Grupo TMM SAB are -

Better consumer reach

– The expansion of the 5G network will help Grupo TMM SAB to increase its market reach. Grupo TMM SAB 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.

Lowering marketing communication costs

– 5G expansion will open new opportunities for Grupo TMM SAB in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Water Transportation 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 Grupo TMM SAB 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.

Developing new processes and practices

– Grupo TMM SAB can develop new processes and procedures in Water Transportation 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.

Buying journey improvements

– Grupo TMM SAB can improve the customer journey of consumers in the Water Transportation 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.

Building a culture of innovation

– managers at Grupo TMM SAB 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 Water Transportation industry.

Low interest rates

– Even though inflation is raising its head in most developed economies, Grupo TMM SAB 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.

Finding new ways to collaborate

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

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects Grupo TMM SAB can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

Using analytics as competitive advantage

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

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. Grupo TMM SAB can explore opportunities that can attract volunteers and are consistent with its mission and vision.

Redefining models of collaboration and team work

– As explained in the weaknesses section, Grupo TMM SAB is facing challenges because of the dominance of functional experts in the organization. Grupo TMM SAB can utilize new technology in the field of Water Transportation industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.

Manufacturing automation

– Grupo TMM SAB can use the latest technology developments to improve its manufacturing and designing process in Water Transportation 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.

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Threats Grupo TMM SAB External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of Grupo TMM SAB are -

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, Grupo TMM SAB 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 Grupo TMM SAB prominent markets.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Grupo TMM SAB in Water Transportation industry. The Water Transportation 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.

Easy access to finance

– Easy access to finance in Water Transportation industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Grupo TMM SAB can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.

Shortening product life cycle

– it is one of the major threat that Grupo TMM SAB is facing in Water Transportation 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, Grupo TMM SAB may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Water Transportation sector.

Regulatory challenges

– Grupo TMM SAB 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 Water Transportation industry regulations.

Stagnating economy with rate increase

– Grupo TMM SAB 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 Water Transportation industry.

Consumer confidence and its impact on Grupo TMM SAB 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 Water Transportation industry and other sectors.

Environmental challenges

– Grupo TMM SAB 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. Grupo TMM SAB can take advantage of this fund but it will also bring new competitors in the Water Transportation 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. Grupo TMM SAB needs to understand the core reasons impacting the Water Transportation industry. This will help it in building a better workplace.

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 dependence on third party suppliers

– Grupo TMM SAB 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.

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Weighted SWOT Analysis of Grupo TMM SAB Template, Example

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

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