Gujarat State Fertilizers (GSFC) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Gujarat State Fertilizers (India)

Based on various researches at Oak Spring University , Gujarat State Fertilizers is operating in a macro-environment that has been destablized by – increasing government debt because of Covid-19 spendings, increasing inequality as vast percentage of new income is going to the top 1%, geopolitical disruptions, there is backlash against globalization, increasing household debt because of falling income levels, cloud computing is disrupting traditional business models, talent flight as more people leaving formal jobs, increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies, etc

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Introduction to SWOT Analysis of Gujarat State Fertilizers

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

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Strengths of Gujarat State Fertilizers | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Gujarat State Fertilizers are -

Ability to recruit top talent

– Gujarat State Fertilizers is one of the leading players in the Chemical Manufacturing 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.

Ability to lead change in Chemical Manufacturing

– Gujarat State Fertilizers is one of the leading players in the Chemical Manufacturing industry in India. Over the years it has not only transformed the business landscape in the Chemical Manufacturing industry in India but also across the existing markets. The ability to lead change has enabled Gujarat State Fertilizers in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

High switching costs

– The high switching costs that Gujarat State Fertilizers 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

– Gujarat State Fertilizers 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 Chemical Manufacturing 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.

Superior customer experience

– The customer experience strategy of Gujarat State Fertilizers in Chemical Manufacturing industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Low bargaining power of suppliers

– Suppliers of Gujarat State Fertilizers in the Basic Materials sector have low bargaining power. Gujarat State Fertilizers has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Gujarat State Fertilizers to manage not only supply disruptions but also source products at highly competitive prices.

Learning organization

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

Digital Transformation in Chemical Manufacturing industry

- digital transformation varies from industry to industry. For Gujarat State Fertilizers digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Gujarat State Fertilizers 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.

Highly skilled collaborators

– Gujarat State Fertilizers has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Chemical Manufacturing industry. Secondly the value chain collaborators of Gujarat State Fertilizers have helped the firm to develop new products and bring them quickly to the marketplace.

Successful track record of launching new products

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

Innovation driven organization

– Gujarat State Fertilizers is one of the most innovative firm in Chemical Manufacturing sector.

Effective Research and Development (R&D)

– Gujarat State Fertilizers has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Gujarat State Fertilizers staying ahead in the Chemical Manufacturing industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

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Weaknesses of Gujarat State Fertilizers | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Gujarat State Fertilizers are -

Lack of clear differentiation of Gujarat State Fertilizers products

– To increase the profitability and margins on the products, Gujarat State Fertilizers needs to provide more differentiated products than what it is currently offering in the marketplace.

High dependence on Gujarat State Fertilizers ‘s star products

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

Need for greater diversity

– Gujarat State Fertilizers 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.

Compensation and incentives

– The revenue per employee of Gujarat State Fertilizers is just above the Chemical Manufacturing industry average. It needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.

Interest costs

– Compare to the competition, Gujarat State Fertilizers 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 Gujarat State Fertilizers is dominated by functional specialists. It is not different from other players in the Chemical Manufacturing industry, but Gujarat State Fertilizers needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Gujarat State Fertilizers to focus more on services in the Chemical Manufacturing industry rather than just following the product oriented approach.

High bargaining power of channel partners in Chemical Manufacturing industry

– because of the regulatory requirements in India, Gujarat State Fertilizers 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 Chemical Manufacturing industry.

Aligning sales with marketing

– From the outside it seems that Gujarat State Fertilizers needs to have more collaboration between its sales team and marketing team. Sales professionals in the Chemical Manufacturing industry have deep experience in developing customer relationships. Marketing department at Gujarat State Fertilizers can leverage the sales team experience to cultivate customer relationships as Gujarat State Fertilizers is planning to shift buying processes online.

Workers concerns about automation

– As automation is fast increasing in the Chemical Manufacturing industry, Gujarat State Fertilizers 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.

Slow to harness new channels of communication

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

Slow decision making process

– As mentioned earlier in the report, Gujarat State Fertilizers has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Chemical Manufacturing industry over the last five years. Gujarat State Fertilizers 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.

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Gujarat State Fertilizers Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of Gujarat State Fertilizers are -

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects Gujarat State Fertilizers can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

Learning at scale

– Online learning technologies has now opened space for Gujarat State Fertilizers 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.

Better consumer reach

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

Building a culture of innovation

– managers at Gujarat State Fertilizers 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 Chemical Manufacturing industry.

Changes in consumer behavior post Covid-19

– consumer behavior has changed in the Chemical Manufacturing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Gujarat State Fertilizers 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. Gujarat State Fertilizers 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.

Using analytics as competitive advantage

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

Buying journey improvements

– Gujarat State Fertilizers can improve the customer journey of consumers in the Chemical Manufacturing industry by using analytics and artificial intelligence. It can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.

Increase in government spending

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

Loyalty marketing

– Gujarat State Fertilizers 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.

Creating value in data economy

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

Leveraging digital technologies

– Gujarat State Fertilizers 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.

Developing new processes and practices

– Gujarat State Fertilizers can develop new processes and procedures in Chemical Manufacturing 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.

Low interest rates

– Even though inflation is raising its head in most developed economies, Gujarat State Fertilizers 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.

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Threats Gujarat State Fertilizers External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of Gujarat State Fertilizers are -

Shortening product life cycle

– it is one of the major threat that Gujarat State Fertilizers is facing in Chemical Manufacturing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

Increasing wage structure of Gujarat State Fertilizers

– 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 Gujarat State Fertilizers.

Environmental challenges

– Gujarat State Fertilizers 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. Gujarat State Fertilizers can take advantage of this fund but it will also bring new competitors in the Chemical Manufacturing industry.

High dependence on third party suppliers

– Gujarat State Fertilizers 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.

Stagnating economy with rate increase

– Gujarat State Fertilizers 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 Chemical Manufacturing industry.

Aging population

– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.

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 Gujarat State Fertilizers business can come under increasing regulations regarding data privacy, data security, etc.

Learning curve for new practices

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

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, Gujarat State Fertilizers 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 Gujarat State Fertilizers prominent markets.

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. Gujarat State Fertilizers needs to understand the core reasons impacting the Chemical Manufacturing industry. This will help it in building a better workplace.

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 Gujarat State Fertilizers.

Barriers of entry lowering

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

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.

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Weighted SWOT Analysis of Gujarat State Fertilizers Template, Example

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

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