SWOT Analysis / TOWS Matrix for Sundram Fasteners (India)
Based on various researches at Oak Spring University , Sundram Fasteners is operating in a macro-environment that has been destablized by – geopolitical disruptions, increasing energy prices, challanges to central banks by blockchain based private currencies, increasing household debt because of falling income levels, increasing transportation and logistics costs, there is backlash against globalization, increasing commodity prices,
increasing government debt because of Covid-19 spendings, technology disruption, etc
Introduction to SWOT Analysis of Sundram Fasteners
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Sundram Fasteners can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Sundram Fasteners, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Sundram Fasteners 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 Sundram Fasteners can be done for the following purposes –
1. Strategic planning of Sundram Fasteners
2. Improving business portfolio management of Sundram Fasteners
3. Assessing feasibility of the new initiative in India
4. Making a Misc. Fabricated Products sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Sundram Fasteners
Strengths of Sundram Fasteners | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Sundram Fasteners are -
Strong track record of project management in the Misc. Fabricated Products industry
– Sundram Fasteners 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 Sundram Fasteners in Misc. Fabricated Products industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Analytics focus
– Sundram Fasteners 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 Misc. Fabricated Products industry. The technology infrastructure of India 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.
Effective Research and Development (R&D)
– Sundram Fasteners has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Sundram Fasteners staying ahead in the Misc. Fabricated Products 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 Misc. Fabricated Products industry
– Sundram Fasteners has clearly differentiated products in the market place. This has enabled Sundram Fasteners to fetch slight price premium compare to the competitors in the Misc. Fabricated Products industry. The sustainable margins have also helped Sundram Fasteners to invest into research and development (R&D) and innovation.
High switching costs
– The high switching costs that Sundram Fasteners 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.
Training and development
– Sundram Fasteners has one of the best training and development program in Basic Materials 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.
Diverse revenue streams
– Sundram Fasteners is present in almost all the verticals within the Misc. Fabricated Products industry. This has provided Sundram Fasteners 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.
Low bargaining power of suppliers
– Suppliers of Sundram Fasteners in the Basic Materials sector have low bargaining power. Sundram Fasteners has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Sundram Fasteners to manage not only supply disruptions but also source products at highly competitive prices.
Organizational Resilience of Sundram Fasteners
– The covid-19 pandemic has put organizational resilience at the centre of everthing Sundram Fasteners does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Successful track record of launching new products
– Sundram Fasteners has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Sundram Fasteners 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.
Digital Transformation in Misc. Fabricated Products industry
- digital transformation varies from industry to industry. For Sundram Fasteners digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Sundram Fasteners 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.
Weaknesses of Sundram Fasteners | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Sundram Fasteners are -
High bargaining power of channel partners in Misc. Fabricated Products industry
– because of the regulatory requirements in India, Sundram Fasteners 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 Misc. Fabricated Products industry.
Capital Spending Reduction
– Even during the low interest decade, Sundram Fasteners has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the Misc. Fabricated Products industry using digital technology.
Slow decision making process
– As mentioned earlier in the report, Sundram Fasteners has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Misc. Fabricated Products industry over the last five years. Sundram Fasteners 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.
Products dominated business model
– Even though Sundram Fasteners has some of the most successful models in the Misc. Fabricated Products industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Sundram Fasteners should strive to include more intangible value offerings along with its core products and services.
Increasing silos among functional specialists
– The organizational structure of Sundram Fasteners is dominated by functional specialists. It is not different from other players in the Misc. Fabricated Products industry, but Sundram Fasteners needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Sundram Fasteners to focus more on services in the Misc. Fabricated Products industry rather than just following the product oriented approach.
Skills based hiring in Misc. Fabricated Products industry
– The stress on hiring functional specialists at Sundram Fasteners has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Slow to strategic competitive environment developments
– As Sundram Fasteners is one of the leading players in the Misc. Fabricated Products industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Misc. Fabricated Products industry in last five years.
High dependence on Sundram Fasteners ‘s star products
– The top 2 products and services of Sundram Fasteners still accounts for major business revenue. This dependence on star products in Misc. Fabricated Products industry has resulted into insufficient focus on developing new products, even though Sundram Fasteners has relatively successful track record of launching new products.
No frontier risks strategy
– From the 10K / annual statement of Sundram Fasteners, it seems that company is thinking out the frontier risks that can impact Misc. Fabricated Products 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 operating costs
– Compare to the competitors, Sundram Fasteners has high operating costs in the Misc. Fabricated Products industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Sundram Fasteners lucrative customers.
Workers concerns about automation
– As automation is fast increasing in the Misc. Fabricated Products industry, Sundram Fasteners needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Sundram Fasteners Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Sundram Fasteners are -
Learning at scale
– Online learning technologies has now opened space for Sundram Fasteners 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.
Loyalty marketing
– Sundram Fasteners 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.
Building a culture of innovation
– managers at Sundram Fasteners 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 Misc. Fabricated Products industry.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Sundram Fasteners can use these opportunities to build new business models that can help the communities that Sundram Fasteners operates in. Secondly it can use opportunities from government spending in Misc. Fabricated Products sector.
Better consumer reach
– The expansion of the 5G network will help Sundram Fasteners to increase its market reach. Sundram Fasteners 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, Sundram Fasteners 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.
Use of Bitcoin and other crypto currencies for transactions in Misc. Fabricated Products industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Sundram Fasteners in the Misc. Fabricated Products industry. Now Sundram Fasteners can target international markets with far fewer capital restrictions requirements than the existing system.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Sundram Fasteners 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 Sundram Fasteners to hire the very best people irrespective of their geographical location.
Leveraging digital technologies
– Sundram Fasteners 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Misc. Fabricated Products industry, but it has also influenced the consumer preferences. Sundram Fasteners can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Sundram Fasteners in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Misc. Fabricated Products industry, and it will provide faster access to the consumers.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Sundram Fasteners 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 Sundram Fasteners to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Sundram Fasteners can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Sundram Fasteners External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Sundram Fasteners are -
Shortening product life cycle
– it is one of the major threat that Sundram Fasteners is facing in Misc. Fabricated Products sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
High dependence on third party suppliers
– Sundram Fasteners 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.
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 Sundram Fasteners.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Sundram Fasteners may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Misc. Fabricated Products sector.
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. Sundram Fasteners needs to understand the core reasons impacting the Misc. Fabricated Products industry. This will help it in building a better workplace.
Consumer confidence and its impact on Sundram Fasteners 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 Misc. Fabricated Products industry and other sectors.
Technology acceleration in Forth Industrial Revolution
– Sundram Fasteners has witnessed rapid integration of technology during Covid-19 in the Misc. Fabricated Products industry. As one of the leading players in the industry, Sundram Fasteners needs to keep up with the evolution of technology in the Misc. Fabricated Products 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Sundram Fasteners in Misc. Fabricated Products industry. The Misc. Fabricated Products 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.
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.
Regulatory challenges
– Sundram Fasteners 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 Misc. Fabricated Products industry regulations.
Environmental challenges
– Sundram Fasteners 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. Sundram Fasteners can take advantage of this fund but it will also bring new competitors in the Misc. Fabricated Products industry.
Increasing wage structure of Sundram Fasteners
– 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 Sundram Fasteners.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Misc. Fabricated Products industry are lowering. It can presents Sundram Fasteners with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Misc. Fabricated Products sector.
Weighted SWOT Analysis of Sundram Fasteners Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Sundram Fasteners 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 Sundram Fasteners 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 Sundram Fasteners 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 Sundram Fasteners 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 Sundram Fasteners needs to make to build a sustainable competitive advantage.
