Kimberly-Clark de Mexico (KCDMY) SWOT Analysis / TOWS Matrix / MBA Resources
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Kimberly-Clark de Mexico (United States)
Based on various researches at Oak Spring University , Kimberly-Clark de Mexico is operating in a macro-environment that has been destablized by – technology disruption, increasing inequality as vast percentage of new income is going to the top 1%, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing energy prices, digital marketing is dominated by two big players Facebook and Google, geopolitical disruptions, banking and financial system is disrupted by Bitcoin and other crypto currencies,
increasing government debt because of Covid-19 spendings, wage bills are increasing, etc
Introduction to SWOT Analysis of Kimberly-Clark de Mexico
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Kimberly-Clark de Mexico can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Kimberly-Clark de Mexico, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Kimberly-Clark de Mexico 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 Kimberly-Clark de Mexico can be done for the following purposes –
1. Strategic planning of Kimberly-Clark de Mexico
2. Improving business portfolio management of Kimberly-Clark de Mexico
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 Kimberly-Clark de Mexico
Strengths of Kimberly-Clark de Mexico | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Kimberly-Clark de Mexico are -
Analytics focus
– Kimberly-Clark de Mexico 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.
Successful track record of launching new products
– Kimberly-Clark de Mexico has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Kimberly-Clark de Mexico 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.
Cross disciplinary teams
– Horizontal connected teams at the Kimberly-Clark de Mexico 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.
Strong track record of project management in the industry
– Kimberly-Clark de Mexico 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 Kimberly-Clark de Mexico in industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Organizational Resilience of Kimberly-Clark de Mexico
– The covid-19 pandemic has put organizational resilience at the centre of everthing Kimberly-Clark de Mexico does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Effective Research and Development (R&D)
– Kimberly-Clark de Mexico has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Kimberly-Clark de Mexico staying ahead in the 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 industry
– Kimberly-Clark de Mexico has clearly differentiated products in the market place. This has enabled Kimberly-Clark de Mexico to fetch slight price premium compare to the competitors in the industry. The sustainable margins have also helped Kimberly-Clark de Mexico to invest into research and development (R&D) and innovation.
Innovation driven organization
– Kimberly-Clark de Mexico is one of the most innovative firm in sector.
Ability to lead change in
– Kimberly-Clark de Mexico 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 Kimberly-Clark de Mexico in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High brand equity
– Kimberly-Clark de Mexico has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Kimberly-Clark de Mexico to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
High switching costs
– The high switching costs that Kimberly-Clark de Mexico 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.
Weaknesses of Kimberly-Clark de Mexico | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Kimberly-Clark de Mexico are -
Employees’ less understanding of Kimberly-Clark de Mexico strategy
– From the outside it seems that the employees of Kimberly-Clark de Mexico 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.
High bargaining power of channel partners in industry
– because of the regulatory requirements in United States, Kimberly-Clark de Mexico 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 industry.
Low market penetration in new markets
– Outside its home market of United States, Kimberly-Clark de Mexico needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Lack of clear differentiation of Kimberly-Clark de Mexico products
– To increase the profitability and margins on the products, Kimberly-Clark de Mexico needs to provide more differentiated products than what it is currently offering in the marketplace.
Interest costs
– Compare to the competition, Kimberly-Clark de Mexico has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Increasing silos among functional specialists
– The organizational structure of Kimberly-Clark de Mexico is dominated by functional specialists. It is not different from other players in the industry, but Kimberly-Clark de Mexico needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Kimberly-Clark de Mexico to focus more on services in the industry rather than just following the product oriented approach.
High cash cycle compare to competitors
Kimberly-Clark de Mexico has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Products dominated business model
– Even though Kimberly-Clark de Mexico 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. Kimberly-Clark de Mexico should strive to include more intangible value offerings along with its core products and services.
Aligning sales with marketing
– From the outside it seems that Kimberly-Clark de Mexico needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department at Kimberly-Clark de Mexico can leverage the sales team experience to cultivate customer relationships as Kimberly-Clark de Mexico is planning to shift buying processes online.
High operating costs
– Compare to the competitors, Kimberly-Clark de Mexico 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 Kimberly-Clark de Mexico lucrative customers.
Slow decision making process
– As mentioned earlier in the report, Kimberly-Clark de Mexico 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. Kimberly-Clark de Mexico 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.
Kimberly-Clark de Mexico Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Kimberly-Clark de Mexico are -
Building a culture of innovation
– managers at Kimberly-Clark de Mexico 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.
Creating value in data economy
– The success of analytics program of Kimberly-Clark de Mexico has opened avenues for new revenue streams for the organization in industry. This can help Kimberly-Clark de Mexico to build a more holistic ecosystem for Kimberly-Clark de Mexico products in the industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Loyalty marketing
– Kimberly-Clark de Mexico 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.
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 Kimberly-Clark de Mexico 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, Kimberly-Clark de Mexico 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 Kimberly-Clark de Mexico to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Kimberly-Clark de Mexico is facing challenges because of the dominance of functional experts in the organization. Kimberly-Clark de Mexico 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Kimberly-Clark de Mexico 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 Kimberly-Clark de Mexico to hire the very best people irrespective of their geographical location.
Learning at scale
– Online learning technologies has now opened space for Kimberly-Clark de Mexico 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.
Developing new processes and practices
– Kimberly-Clark de Mexico can develop new processes and procedures in 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.
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 Kimberly-Clark de Mexico in the industry. Now Kimberly-Clark de Mexico can target international markets with far fewer capital restrictions requirements than the existing system.
Leveraging digital technologies
– Kimberly-Clark de Mexico 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Kimberly-Clark de Mexico 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
– Kimberly-Clark de Mexico has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in sector. This continuous investment in analytics has enabled Kimberly-Clark de Mexico to build a competitive advantage using analytics. The analytics driven competitive advantage can help Kimberly-Clark de Mexico to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Kimberly-Clark de Mexico External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Kimberly-Clark de Mexico are -
Increasing wage structure of Kimberly-Clark de Mexico
– 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 Kimberly-Clark de Mexico.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Kimberly-Clark de Mexico may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of 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 Kimberly-Clark de Mexico.
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.
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. Kimberly-Clark de Mexico 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.
Regulatory challenges
– Kimberly-Clark de Mexico 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to industry are lowering. It can presents Kimberly-Clark de Mexico with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Kimberly-Clark de Mexico 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 Kimberly-Clark de Mexico prominent markets.
Environmental challenges
– Kimberly-Clark de Mexico 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. Kimberly-Clark de Mexico can take advantage of this fund but it will also bring new competitors in the 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. Kimberly-Clark de Mexico needs to understand the core reasons impacting the industry. This will help it in building a better workplace.
Easy access to finance
– Easy access to finance in industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Kimberly-Clark de Mexico can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Kimberly-Clark de Mexico in the sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– Kimberly-Clark de Mexico has witnessed rapid integration of technology during Covid-19 in the industry. As one of the leading players in the industry, Kimberly-Clark de Mexico 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.
Weighted SWOT Analysis of Kimberly-Clark de Mexico Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Kimberly-Clark de Mexico 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 Kimberly-Clark de Mexico 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 Kimberly-Clark de Mexico 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 Kimberly-Clark de Mexico 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 Kimberly-Clark de Mexico needs to make to build a sustainable competitive advantage.