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SWOT Analysis: Millennium Challenge Corporation

Team Delta

College of Integrative Sciences and Arts, Arizona State University

OGL355: Leading Organizational Innovation and Change

Dr. B

November 4, 2020
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SWOT Analysis: Millennium Challenge Corporation

Team Delta performed internal and external audits of MCC to help identify its

competitive advantages, and aid in developing strategic planning. In order for MCC to

improve, we performed a SWOT analysis. A SWOT helps determine the organization's

strengths, weaknesses, opportunities, and threats. This SWOT analysis will reflect

MCC’s mission statement of, “reduce poverty through economic growth.” It will help

capitalize on the strengths, shore up on the weaknesses, invest on potential growth

opportunities, and identify any threats.

SWOT Analysis

SWOT analysis has both positives, and negatives within an organization and

encompasses internal and external factors that may contribute to any of the following

within an organization: strengths, weaknesses, opportunities, and threats. These four

categories may be focused on a certain vision or strategy an organization is

contemplating pursuing, or an internal analysis/organization assessment.

An organization's strengths could help in gaining a competitive advantage, but can also

expose a weakness within that organization. For example, one strength for Millennium

Challenge Corporation is their thorough selection process, however this also exposes a

weakness such as “limited systematic impact, this may give competitors their competitive

advantage.
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Opportunities and threat also tend to go hand and hand as opportunities are caused by

external factors and could be as a result of a new change within the organization's

operating area.

An example of an opportunity for MCC is their exponential growth and population. A

threat here could potentially be exposed in this opportunity as it may leave room for an

organization similar to MCC, but with perhaps more funding and less selectiveness.

Being that MCC is extremely selective and only supports countries with democratic

standings of which are invested in their people, a potential threat could very well have

been a previous opportunity such as, a change in the nation's political stance on a new

election, causing change to its previous democratic standpoints and therefore preventing

MCC from providing aid.

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Strengths Weaknesses
● Focus on results ● Lack of strategic relationships
● Transparency ● Collecting reliable data from
● Thorough and effective selection programs in poor countries
process ● Limited systematic impact
● Well-structured ownership in ● Lack of resource framework
partner countries

Opportunities
● Online presence (Social media)
● Regional Integration
● Exponential growth in population
● Countries’ needs shifting
Threats
● Threat of New Entrants
● International Geo-Political Factors
● Underdeveloped Technology
● Squeezing Middle Class

Strengths

One of the Millennium Challenge Corporation’s greatest strengths is their focus

on results. Rather than simply offering aid to countries in need of assistance and hoping

that recipient countries benefit, the MCC has implemented a meticulous approach for

ensuring aid effectiveness. This process involves thorough projecting, tracking, and

evaluation of the successfulness of each investment. The MCC’s goal is to provide

sustainable growth, and to eventually see increased incomes within those countries

receiving aid (Millennium Challenge Corporation, 2010). Not only does the evaluation

process ensure that these goals are being met, but it also allows the corporation to see

when their efforts are off-track or making little progress. By evaluating the effectiveness
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of their grants, the MCC is able to ensure that resources are being allocated appropriately

and efficiently, and furthermore, that the recipient countries are truly benefiting from

those resources, or if there is any room for improvement.

Another strength of the MCC is their level of transparency. The corporation states

that “transparency is at the heart of accountability” and they take several measures to

ensure they are being held accountable (Millennium Challenge Corporation, 2010, p. 4).

One example of this is the easy accessibility to the MCC’s financial and program

information. According to the MCC’s website, they offer more information to the public

domain than any other donors (Millennium Challenge Corporation, 2010). Additionally,

the MCC’s transparency enables them to build trusting relationships with stakeholders

and partner countries.

Weaknesses

With a corporation as broad and as effective as the MCC is, it is important to

prevent their weaknesses becoming their downfall. One of these problems for the MCC is

collecting reliable data from programs in poor countries. Although the MCC contains a

robust system to capture data, what’s lacking is a rise in additional management systems

that systematically share and deploy learning internally. This includes collecting data

from economic benefits of policy, institutional, and governance reform, as well as

distinguishing gender data, the poor, and other marginalized groups in developing

countries (Millennium Challenge Corporation, 2010). The MCC does not explore enough

alternative sources of data that are consistent throughout developing countries which

could be used to better assess poverty.

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Another weakness of the MCC is limited sustained impact through governance

systems. The MCC specialise in policy and institutional reform mustn’t stop at country

selection. The expectations from stakeholders for the MCC include building accountable

national and local institutions, and strengthening the social contract between citizens and

the state (Millennium Challenge Corporation, 2010). The MCC is in need of discovering

ways to organize good governance and country systems, steady with country interest and

needs. This includes a desperate need to reinforce critical growth-promoting on

governance systems, expand pressure analysis to assess impacts, to designate resources

wisely and execute programs effectively. If the MCC does not want to accept these

forces, it could potentially halt growth in areas of opportunity that may further the gains

for the poor and advance inclusive growth.

Opportunities

After establishing their weaknesses, MCC has many opportunities that they could

utilize to exploit its advantages. The emergence of social media marketing has become a

trend in the last few years. If MCC were to establish a strong online presence, it could

potentially raise even more awareness to countries needing the foreign aid. If MCC were

to expand their online presence, it could attract public and private donors that could

potentially exceed MCC funding capabilities. This could also result in better leveraging

the effectiveness of the distinctive implementation model. (“Goal 1: Opportunities|

Millennium Challenge Corporation”)

Regional integration is something that MCC struggles with, when investments

stop at the border of poverty stricken countries if they focus on bilateral engagements.

Regional investments present more opportunities for higher rates of returns on

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investments and a faster rate of poverty reduction. MCC has the technical capacity to

deliver large, complex infrastructure projects and they have the ability to deploy that

capacity for cross-border investments. MCC also has the experience in incentivizing and

supporting difficult policy, regulatory, and institutional reforms that must accompany

infrastructure investments so growth gains can be realized. “MCC could bring together

the hardware and software of regional integration that could make a dynamic regional

markets function and grow” (“New Strategic Directions| Millennium Challenge

Corporation”). If MCC could utilize the opportunities they have to develop coordinated

regional integration, they have the potential to help countries work together and grow

regional markets, expand their power, transport and water networks to reduce the cost,

improve service, facilitate increased trade and investment, and help generate new

business and market opportunities for U.S., global and local companies (MCC).

Threats

Two of the threats facing the Millennium Challenge Corporation (MCC) are

international geopolitical factors and technology implementation. One of MCC's

premises is that "economic development succeeds best if it is linked to free market and

democratic principles and policies and where governments are committed to

implementing reform measures to achieve such goal" (Congressional Research Service,

2019, p. 1). After the 2016 US elections, there has been a shift to growing protectionism,

which further complicated issues with Coronavirus (COVID-19), and the global

economic impact. The organization's efforts in Nepal's country served as an example of

how "frequent changes in government leadership have resulted in policy

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implementation," led to unpredictability for firms operating in the country (Subedi, 2014,

p.9). A second threat to the MCC organization is technology within their target market.

Many of the countries served by MCC are developing low-income to middle-income, and

that faces technological-developmental challenges. For Example, as a result of this threat

many of the countries served by MCC have limited capacity for harnessing technology

and innovation to raise their productivity. For example, in Ghana, one of the major

barriers for organizations doing business is the “lack of affordable and reliable power”

(United States, 2016).

Conclusion

The assessment of our SWOT analysis on MCC concluded the following. Based

on our analysis, MCC’s major strengths are its internal processing systems and its

transparency. These strengths are due in large part because of MCC’s use of the

“Growth Diagnostic” theory and strategy for tracking and evaluationing each investment.

Deploying the Growth Diagnostic theory as their central focus for engaging poor

countries has set them apart in the industry (Millennium Challenge Corporation, 2010).

However, as effective as the “Growth Diagnostic” principles and strategies are,

these processes and strategies are only as effective as the data it receives and the stability

of recipient governments. These are the most serious weaknesses our analysis discovered.

Because MCC serves the poorest countries in the world, collecting reliable data and
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engaging stable governments appears to be an ongoing challenge to MCC continued

success.

Our analysis also discovered great opportunities available to MCC that would

help strengthen their weaknesses and increase its donor base. These opportunities include

increasing and leveraging its social media presence. In doing so they can increase their

donor base to join in the effort to fight world poverty. Another opportunity is to expand

its platform to include regional collaborations between countries, not only will this allow

MCC to leverage its current investments but it will increase the quality of data and

governance accountability.

Finally, the best programs and increased investments can not completely

eliminate the threats MCC face when taking on challenges as daunting as reducing world

poverty in the poorest countries in the world. The geopolitical challenges along with

access to technology in most of these countries will remain a threat to the success of

MCC going forward.

APPROVAL: (sign off with initials by 12pm AZ time 11/4/2020) - plan to submit by 1-
2pm 11/4/2020

Drew Sledge- Justine Kelsey Jesus Rojas- Marissa

DS Echenique - JE Boatman- KB JSR Mallahan - MM

Tim Lynch-TL Amanda

Salameh - AS
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References

“Goal 1: Opportunities | Millennium Challenge Corporation.” Millennium Challenge

Corporation, https://www.facebook.com/MillenniumChallengeCorp/,

https://www.mcc.gov/resources/story/story-next-goal-one-opportunities. Accessed

3 Nov. 2020.

Millennium Challenge Corporation. (2010). MCC and the United States’ global

development policy. https://assets.mcc.gov/content/uploads/2017/05/issuebrief-

2011002038902-mccandglobaldev.pdf

“New Strategic Directions | Millennium Challenge Corporation.” Millennium Challenge

Corporation, https://www.facebook.com/MillenniumChallengeCorp/,

https://www.mcc.gov/resources/story/story-next-new-strategic-

directions#direction-1. Accessed 3 Nov. 2020.

Subedi, S.R. (2014). Nepal Growth Diagnostic. MCC.gov. Retrieved from

https://assets.mcc.gov/content/uploads/2017/05/Nepal_CA_withCover.pdf

United states: Millennium challenge cooperation powering Africa: Ghana. (2016, Dec

06). Asia News Monitor Retrieved from http://login.ezproxy1.lib.asu.edu/login?

url=https://www-proquest-com.ezproxy1.lib.asu.edu/docview/1845771931?

accountid=4485