Jeronimo Martins SGPS SA ADR (JRONY) SWOT Analysis / TOWS Matrix / MBA Resources
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Jeronimo Martins SGPS SA ADR (United States)
Based on various researches at Oak Spring University , Jeronimo Martins SGPS SA ADR is operating in a macro-environment that has been destablized by – geopolitical disruptions, increasing energy prices, increasing government debt because of Covid-19 spendings, cloud computing is disrupting traditional business models, supply chains are disrupted by pandemic , there is increasing trade war between United States & China, central banks are concerned over increasing inflation,
increasing commodity prices, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Jeronimo Martins SGPS SA ADR
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Jeronimo Martins SGPS SA ADR can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Jeronimo Martins SGPS SA ADR, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Jeronimo Martins SGPS SA ADR 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 Jeronimo Martins SGPS SA ADR can be done for the following purposes –
1. Strategic planning of Jeronimo Martins SGPS SA ADR
2. Improving business portfolio management of Jeronimo Martins SGPS SA ADR
3. Assessing feasibility of the new initiative in United States
4. Making a sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Jeronimo Martins SGPS SA ADR
Strengths of Jeronimo Martins SGPS SA ADR | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Jeronimo Martins SGPS SA ADR are -
Ability to recruit top talent
– Jeronimo Martins SGPS SA ADR is one of the leading players in the industry in United States. It is in a position to attract the best talent available in United States. The firm has a robust talent identification program that helps in identifying the brightest.
Highly skilled collaborators
– Jeronimo Martins SGPS SA ADR has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive industry. Secondly the value chain collaborators of Jeronimo Martins SGPS SA ADR have helped the firm to develop new products and bring them quickly to the marketplace.
Strong track record of project management in the industry
– Jeronimo Martins SGPS SA ADR is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Superior customer experience
– The customer experience strategy of Jeronimo Martins SGPS SA ADR in industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the Jeronimo Martins SGPS SA ADR 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.
High brand equity
– Jeronimo Martins SGPS SA ADR has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Jeronimo Martins SGPS SA ADR to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of Jeronimo Martins SGPS SA ADR in the sector have low bargaining power. Jeronimo Martins SGPS SA ADR has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Jeronimo Martins SGPS SA ADR to manage not only supply disruptions but also source products at highly competitive prices.
Ability to lead change in
– Jeronimo Martins SGPS SA ADR is one of the leading players in the industry in United States. Over the years it has not only transformed the business landscape in the industry in United States but also across the existing markets. The ability to lead change has enabled Jeronimo Martins SGPS SA ADR in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Successful track record of launching new products
– Jeronimo Martins SGPS SA ADR has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Jeronimo Martins SGPS SA ADR 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.
Analytics focus
– Jeronimo Martins SGPS SA ADR 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 industry. The technology infrastructure of United States 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.
Learning organization
- Jeronimo Martins SGPS SA ADR 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 Jeronimo Martins SGPS SA ADR is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Jeronimo Martins SGPS SA ADR emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in industry
– Jeronimo Martins SGPS SA ADR has clearly differentiated products in the market place. This has enabled Jeronimo Martins SGPS SA ADR to fetch slight price premium compare to the competitors in the industry. The sustainable margins have also helped Jeronimo Martins SGPS SA ADR to invest into research and development (R&D) and innovation.
Weaknesses of Jeronimo Martins SGPS SA ADR | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Jeronimo Martins SGPS SA ADR are -
Slow to strategic competitive environment developments
– As Jeronimo Martins SGPS SA ADR is one of the leading players in the industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Ability to respond to the competition
– As the decision making is very deliberative at Jeronimo Martins SGPS SA ADR, in the dynamic environment of industry it has struggled to respond to the nimble upstart competition. Jeronimo Martins SGPS SA ADR 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, Jeronimo Martins SGPS SA ADR has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Jeronimo Martins SGPS SA ADR 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.
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 Jeronimo Martins SGPS SA ADR supply chain. Even after few cautionary changes, Jeronimo Martins SGPS SA ADR is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Jeronimo Martins SGPS SA ADR vulnerable to further global disruptions in South East Asia.
High operating costs
– Compare to the competitors, Jeronimo Martins SGPS SA ADR has high operating costs in the industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Jeronimo Martins SGPS SA ADR lucrative customers.
Compensation and incentives
– The revenue per employee of Jeronimo Martins SGPS SA ADR is just above the 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.
High dependence on Jeronimo Martins SGPS SA ADR ‘s star products
– The top 2 products and services of Jeronimo Martins SGPS SA ADR still accounts for major business revenue. This dependence on star products in industry has resulted into insufficient focus on developing new products, even though Jeronimo Martins SGPS SA ADR has relatively successful track record of launching new products.
Lack of clear differentiation of Jeronimo Martins SGPS SA ADR products
– To increase the profitability and margins on the products, Jeronimo Martins SGPS SA ADR needs to provide more differentiated products than what it is currently offering in the marketplace.
Increasing silos among functional specialists
– The organizational structure of Jeronimo Martins SGPS SA ADR is dominated by functional specialists. It is not different from other players in the industry, but Jeronimo Martins SGPS SA ADR needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Jeronimo Martins SGPS SA ADR to focus more on services in the industry rather than just following the product oriented approach.
Products dominated business model
– Even though Jeronimo Martins SGPS SA ADR has some of the most successful models in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Jeronimo Martins SGPS SA ADR should strive to include more intangible value offerings along with its core products and services.
Employees’ less understanding of Jeronimo Martins SGPS SA ADR strategy
– From the outside it seems that the employees of Jeronimo Martins SGPS SA ADR 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.
Jeronimo Martins SGPS SA ADR Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Jeronimo Martins SGPS SA ADR are -
Low interest rates
– Even though inflation is raising its head in most developed economies, Jeronimo Martins SGPS SA ADR 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.
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. Jeronimo Martins SGPS SA ADR can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 Jeronimo Martins SGPS SA ADR 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Jeronimo Martins SGPS SA ADR can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help Jeronimo Martins SGPS SA ADR to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Jeronimo Martins SGPS SA ADR in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the industry, and it will provide faster access to the consumers.
Better consumer reach
– The expansion of the 5G network will help Jeronimo Martins SGPS SA ADR to increase its market reach. Jeronimo Martins SGPS SA ADR 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.
Loyalty marketing
– Jeronimo Martins SGPS SA ADR 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Jeronimo Martins SGPS SA ADR can use these opportunities to build new business models that can help the communities that Jeronimo Martins SGPS SA ADR operates in. Secondly it can use opportunities from government spending in sector.
Building a culture of innovation
– managers at Jeronimo Martins SGPS SA ADR 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 industry.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Jeronimo Martins SGPS SA ADR 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. Jeronimo Martins SGPS SA ADR 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.
Leveraging digital technologies
– Jeronimo Martins SGPS SA ADR 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.
Use of Bitcoin and other crypto currencies for transactions in industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Jeronimo Martins SGPS SA ADR in the industry. Now Jeronimo Martins SGPS SA ADR can target international markets with far fewer capital restrictions requirements than the existing system.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Jeronimo Martins SGPS SA ADR is facing challenges because of the dominance of functional experts in the organization. Jeronimo Martins SGPS SA ADR can utilize new technology in the field of industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Threats Jeronimo Martins SGPS SA ADR External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Jeronimo Martins SGPS SA ADR are -
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 Jeronimo Martins SGPS SA ADR in the sector and impact the bottomline of the organization.
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. Jeronimo Martins SGPS SA ADR needs to understand the core reasons impacting the industry. This will help it in building a better workplace.
Technology acceleration in Forth Industrial Revolution
– Jeronimo Martins SGPS SA ADR has witnessed rapid integration of technology during Covid-19 in the industry. As one of the leading players in the industry, Jeronimo Martins SGPS SA ADR needs to keep up with the evolution of technology in the 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.
Shortening product life cycle
– it is one of the major threat that Jeronimo Martins SGPS SA ADR is facing in sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Jeronimo Martins SGPS SA ADR in industry. The 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
– Jeronimo Martins SGPS SA ADR 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 industry regulations.
Increasing wage structure of Jeronimo Martins SGPS SA ADR
– 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 Jeronimo Martins SGPS SA ADR.
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 Jeronimo Martins SGPS SA ADR.
High dependence on third party suppliers
– Jeronimo Martins SGPS SA ADR 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.
Stagnating economy with rate increase
– Jeronimo Martins SGPS SA ADR 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 industry.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to industry are lowering. It can presents Jeronimo Martins SGPS SA ADR with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
Weighted SWOT Analysis of Jeronimo Martins SGPS SA ADR Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Jeronimo Martins SGPS SA ADR 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 Jeronimo Martins SGPS SA ADR 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 Jeronimo Martins SGPS SA ADR 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 Jeronimo Martins SGPS SA ADR 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 Jeronimo Martins SGPS SA ADR needs to make to build a sustainable competitive advantage.
