SWOT Analysis / TOWS Matrix for Cochin Shipyard (India)
Based on various researches at Oak Spring University , Cochin Shipyard is operating in a macro-environment that has been destablized by – there is backlash against globalization, increasing energy prices, increasing transportation and logistics costs, digital marketing is dominated by two big players Facebook and Google, cloud computing is disrupting traditional business models, central banks are concerned over increasing inflation, wage bills are increasing,
challanges to central banks by blockchain based private currencies, supply chains are disrupted by pandemic , etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Cochin Shipyard can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Cochin Shipyard, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Cochin Shipyard 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 Cochin Shipyard can be done for the following purposes –
1. Strategic planning of Cochin Shipyard
2. Improving business portfolio management of Cochin Shipyard
3. Assessing feasibility of the new initiative in India
4. Making a Water Transportation sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Cochin Shipyard
Strengths of Cochin Shipyard | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Cochin Shipyard are -
Digital Transformation in Water Transportation industry
- digital transformation varies from industry to industry. For Cochin Shipyard digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Cochin Shipyard 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.
Ability to recruit top talent
– Cochin Shipyard is one of the leading players in the Water Transportation industry in India. It is in a position to attract the best talent available in India. The firm has a robust talent identification program that helps in identifying the brightest.
Learning organization
- Cochin Shipyard 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 Cochin Shipyard is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Cochin Shipyard emphasize – knowledge, initiative, and innovation.
Organizational Resilience of Cochin Shipyard
– The covid-19 pandemic has put organizational resilience at the centre of everthing Cochin Shipyard does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Highly skilled collaborators
– Cochin Shipyard has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Water Transportation industry. Secondly the value chain collaborators of Cochin Shipyard have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to lead change in Water Transportation
– Cochin Shipyard is one of the leading players in the Water Transportation industry in India. Over the years it has not only transformed the business landscape in the Water Transportation industry in India but also across the existing markets. The ability to lead change has enabled Cochin Shipyard in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Operational resilience
– The operational resilience strategy of Cochin Shipyard comprises – understanding the underlying the factors in the Water Transportation 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.
Training and development
– Cochin Shipyard has one of the best training and development program in Transportation 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.
High switching costs
– The high switching costs that Cochin Shipyard 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.
Analytics focus
– Cochin Shipyard 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 Water Transportation 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.
Low bargaining power of suppliers
– Suppliers of Cochin Shipyard in the Transportation sector have low bargaining power. Cochin Shipyard has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Cochin Shipyard to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Cochin Shipyard in Water Transportation industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses of Cochin Shipyard | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Cochin Shipyard are -
Slow to strategic competitive environment developments
– As Cochin Shipyard is one of the leading players in the Water Transportation industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Water Transportation industry in last five years.
Increasing silos among functional specialists
– The organizational structure of Cochin Shipyard is dominated by functional specialists. It is not different from other players in the Water Transportation industry, but Cochin Shipyard needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Cochin Shipyard to focus more on services in the Water Transportation industry rather than just following the product oriented approach.
High operating costs
– Compare to the competitors, Cochin Shipyard has high operating costs in the Water Transportation industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Cochin Shipyard lucrative customers.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Cochin Shipyard is slow explore the new channels of communication. These new channels of communication can help Cochin Shipyard to provide better information regarding Water Transportation products and services. It can also build an online community to further reach out to potential customers.
Ability to respond to the competition
– As the decision making is very deliberative at Cochin Shipyard, in the dynamic environment of Water Transportation industry it has struggled to respond to the nimble upstart competition. Cochin Shipyard has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
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 Cochin Shipyard supply chain. Even after few cautionary changes, Cochin Shipyard is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Cochin Shipyard vulnerable to further global disruptions in South East Asia.
Workers concerns about automation
– As automation is fast increasing in the Water Transportation industry, Cochin Shipyard 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.
Lack of clear differentiation of Cochin Shipyard products
– To increase the profitability and margins on the products, Cochin Shipyard needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow decision making process
– As mentioned earlier in the report, Cochin Shipyard has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Water Transportation industry over the last five years. Cochin Shipyard 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.
Interest costs
– Compare to the competition, Cochin Shipyard 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.
High cash cycle compare to competitors
Cochin Shipyard has a high cash cycle compare to other players in the Water Transportation industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Cochin Shipyard Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Cochin Shipyard are -
Use of Bitcoin and other crypto currencies for transactions in Water Transportation industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Cochin Shipyard in the Water Transportation industry. Now Cochin Shipyard can target international markets with far fewer capital restrictions requirements than the existing system.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Cochin Shipyard in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Water Transportation industry, and it will provide faster access to the consumers.
Better consumer reach
– The expansion of the 5G network will help Cochin Shipyard to increase its market reach. Cochin Shipyard 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.
Manufacturing automation
– Cochin Shipyard can use the latest technology developments to improve its manufacturing and designing process in Water Transportation 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.
Using analytics as competitive advantage
– Cochin Shipyard has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Water Transportation sector. This continuous investment in analytics has enabled Cochin Shipyard to build a competitive advantage using analytics. The analytics driven competitive advantage can help Cochin Shipyard to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Cochin Shipyard 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 Cochin Shipyard to hire the very best people irrespective of their geographical location.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Cochin Shipyard can use these opportunities to build new business models that can help the communities that Cochin Shipyard operates in. Secondly it can use opportunities from government spending in Water Transportation sector.
Creating value in data economy
– The success of analytics program of Cochin Shipyard has opened avenues for new revenue streams for the organization in Water Transportation industry. This can help Cochin Shipyard to build a more holistic ecosystem for Cochin Shipyard products in the Water Transportation industry by providing – data insight services, data privacy related products, data based consulting services, etc.
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. Cochin Shipyard can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Leveraging digital technologies
– Cochin Shipyard 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Water Transportation industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Cochin Shipyard 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. Cochin Shipyard 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.
Building a culture of innovation
– managers at Cochin Shipyard 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 Water Transportation industry.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Cochin Shipyard is facing challenges because of the dominance of functional experts in the organization. Cochin Shipyard can utilize new technology in the field of Water Transportation industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Threats Cochin Shipyard External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Cochin Shipyard are -
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.
Consumer confidence and its impact on Cochin Shipyard 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 Water Transportation industry and other sectors.
Environmental challenges
– Cochin Shipyard 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. Cochin Shipyard can take advantage of this fund but it will also bring new competitors in the Water Transportation industry.
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 Cochin Shipyard.
Regulatory challenges
– Cochin Shipyard 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 Water Transportation industry regulations.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Cochin Shipyard 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 Cochin Shipyard prominent markets.
Shortening product life cycle
– it is one of the major threat that Cochin Shipyard is facing in Water Transportation sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Technology acceleration in Forth Industrial Revolution
– Cochin Shipyard has witnessed rapid integration of technology during Covid-19 in the Water Transportation industry. As one of the leading players in the industry, Cochin Shipyard needs to keep up with the evolution of technology in the Water Transportation 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.
Easy access to finance
– Easy access to finance in Water Transportation industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Cochin Shipyard can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
High dependence on third party suppliers
– Cochin Shipyard 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.
Increasing wage structure of Cochin Shipyard
– 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 Cochin Shipyard.
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. Cochin Shipyard needs to understand the core reasons impacting the Water Transportation industry. This will help it in building a better workplace.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Cochin Shipyard may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Water Transportation sector.
Weighted SWOT Analysis of Cochin Shipyard Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Cochin Shipyard 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 Cochin Shipyard 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 Cochin Shipyard 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 Cochin Shipyard 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 Cochin Shipyard needs to make to build a sustainable competitive advantage.