Verneuil (TCNP) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Verneuil (France)

Based on various researches at Oak Spring University , Verneuil is operating in a macro-environment that has been destablized by – increasing energy prices, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing inequality as vast percentage of new income is going to the top 1%, talent flight as more people leaving formal jobs, supply chains are disrupted by pandemic , cloud computing is disrupting traditional business models, there is backlash against globalization, technology disruption, challanges to central banks by blockchain based private currencies, etc

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Introduction to SWOT Analysis of Verneuil

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

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Strengths of Verneuil | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Verneuil are -

High switching costs

– The high switching costs that Verneuil 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.

Successful track record of launching new products

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

Sustainable margins compare to other players in Fish/Livestock industry

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

Organizational Resilience of Verneuil

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

Cross disciplinary teams

– Horizontal connected teams at the Verneuil 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.

Training and development

– Verneuil has one of the best training and development program in Consumer/Non-Cyclical 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.

Ability to recruit top talent

– Verneuil is one of the leading players in the Fish/Livestock industry in France. It is in a position to attract the best talent available in France. The firm has a robust talent identification program that helps in identifying the brightest.

Low bargaining power of suppliers

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

Diverse revenue streams

– Verneuil is present in almost all the verticals within the Fish/Livestock industry. This has provided Verneuil 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.

Digital Transformation in Fish/Livestock industry

- digital transformation varies from industry to industry. For Verneuil digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Verneuil has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.

Learning organization

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

Operational resilience

– The operational resilience strategy of Verneuil comprises – understanding the underlying the factors in the Fish/Livestock 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.

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Weaknesses of Verneuil | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Verneuil are -

Ability to respond to the competition

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

Increasing silos among functional specialists

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

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 Verneuil supply chain. Even after few cautionary changes, Verneuil is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Verneuil vulnerable to further global disruptions in South East Asia.

Interest costs

– Compare to the competition, Verneuil 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.

No frontier risks strategy

– From the 10K / annual statement of Verneuil, it seems that company is thinking out the frontier risks that can impact Fish/Livestock 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 Verneuil ‘s star products

– The top 2 products and services of Verneuil still accounts for major business revenue. This dependence on star products in Fish/Livestock industry has resulted into insufficient focus on developing new products, even though Verneuil has relatively successful track record of launching new products.

Need for greater diversity

– Verneuil 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.

Slow decision making process

– As mentioned earlier in the report, Verneuil has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Fish/Livestock industry over the last five years. Verneuil 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.

Slow to harness new channels of communication

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

High bargaining power of channel partners in Fish/Livestock industry

– because of the regulatory requirements in France, Verneuil 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 Fish/Livestock industry.

High cash cycle compare to competitors

Verneuil has a high cash cycle compare to other players in the Fish/Livestock industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.

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Verneuil Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of Verneuil 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 Verneuil 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 Fish/Livestock industry, but it has also influenced the consumer preferences. Verneuil can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

Leveraging digital technologies

– Verneuil 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.

Using analytics as competitive advantage

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

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, Verneuil 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 Verneuil to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

Creating value in data economy

– The success of analytics program of Verneuil has opened avenues for new revenue streams for the organization in Fish/Livestock industry. This can help Verneuil to build a more holistic ecosystem for Verneuil products in the Fish/Livestock industry by providing – data insight services, data privacy related products, data based consulting services, etc.

Manufacturing automation

– Verneuil can use the latest technology developments to improve its manufacturing and designing process in Fish/Livestock 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.

Building a culture of innovation

– managers at Verneuil 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 Fish/Livestock industry.

Better consumer reach

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

Low interest rates

– Even though inflation is raising its head in most developed economies, Verneuil 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.

Changes in consumer behavior post Covid-19

– consumer behavior has changed in the Fish/Livestock industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Verneuil 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. Verneuil 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.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Verneuil can use these opportunities to build new business models that can help the communities that Verneuil operates in. Secondly it can use opportunities from government spending in Fish/Livestock sector.

Use of Bitcoin and other crypto currencies for transactions in Fish/Livestock industry

– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Verneuil in the Fish/Livestock industry. Now Verneuil can target international markets with far fewer capital restrictions requirements than the existing system.

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Threats Verneuil External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of Verneuil are -

Increasing wage structure of Verneuil

– 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 Verneuil.

Consumer confidence and its impact on Verneuil 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 Fish/Livestock industry and other sectors.

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. Verneuil 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.

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.

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 Verneuil in the Fish/Livestock sector and impact the bottomline of the organization.

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 Verneuil.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Verneuil in Fish/Livestock industry. The Fish/Livestock 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.

Shortening product life cycle

– it is one of the major threat that Verneuil is facing in Fish/Livestock sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

Stagnating economy with rate increase

– Verneuil 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 Fish/Livestock industry.

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 Verneuil business can come under increasing regulations regarding data privacy, data security, etc.

Technology acceleration in Forth Industrial Revolution

– Verneuil has witnessed rapid integration of technology during Covid-19 in the Fish/Livestock industry. As one of the leading players in the industry, Verneuil needs to keep up with the evolution of technology in the Fish/Livestock 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.

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, Verneuil may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Fish/Livestock sector.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry to Fish/Livestock industry are lowering. It can presents Verneuil with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Fish/Livestock sector.

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Weighted SWOT Analysis of Verneuil Template, Example

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

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