SWOT Analysis / TOWS Matrix for IOL Chemicals Pharmaceuticals (India)
Based on various researches at Oak Spring University , IOL Chemicals Pharmaceuticals is operating in a macro-environment that has been destablized by – increasing energy prices, increasing household debt because of falling income levels, increasing commodity prices, competitive advantages are harder to sustain because of technology dispersion, talent flight as more people leaving formal jobs, increasing transportation and logistics costs, customer relationship management is fast transforming because of increasing concerns over data privacy,
supply chains are disrupted by pandemic , challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of IOL Chemicals Pharmaceuticals
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that IOL Chemicals Pharmaceuticals can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the IOL Chemicals Pharmaceuticals, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which IOL Chemicals Pharmaceuticals 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 IOL Chemicals Pharmaceuticals can be done for the following purposes –
1. Strategic planning of IOL Chemicals Pharmaceuticals
2. Improving business portfolio management of IOL Chemicals Pharmaceuticals
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 IOL Chemicals Pharmaceuticals
Strengths of IOL Chemicals Pharmaceuticals | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of IOL Chemicals Pharmaceuticals are -
Innovation driven organization
– IOL Chemicals Pharmaceuticals is one of the most innovative firm in Chemical Manufacturing sector.
Analytics focus
– IOL Chemicals Pharmaceuticals 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.
Low bargaining power of suppliers
– Suppliers of IOL Chemicals Pharmaceuticals in the Basic Materials sector have low bargaining power. IOL Chemicals Pharmaceuticals has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps IOL Chemicals Pharmaceuticals to manage not only supply disruptions but also source products at highly competitive prices.
Ability to recruit top talent
– IOL Chemicals Pharmaceuticals 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.
Training and development
– IOL Chemicals Pharmaceuticals 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.
Learning organization
- IOL Chemicals Pharmaceuticals 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 IOL Chemicals Pharmaceuticals is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at IOL Chemicals Pharmaceuticals emphasize – knowledge, initiative, and innovation.
Effective Research and Development (R&D)
– IOL Chemicals Pharmaceuticals has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – IOL Chemicals Pharmaceuticals 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.
Superior customer experience
– The customer experience strategy of IOL Chemicals Pharmaceuticals in Chemical Manufacturing industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Operational resilience
– The operational resilience strategy of IOL Chemicals Pharmaceuticals comprises – understanding the underlying the factors in the Chemical Manufacturing 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.
Digital Transformation in Chemical Manufacturing industry
- digital transformation varies from industry to industry. For IOL Chemicals Pharmaceuticals digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. IOL Chemicals Pharmaceuticals 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.
Successful track record of launching new products
– IOL Chemicals Pharmaceuticals has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. IOL Chemicals Pharmaceuticals 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.
Diverse revenue streams
– IOL Chemicals Pharmaceuticals is present in almost all the verticals within the Chemical Manufacturing industry. This has provided IOL Chemicals Pharmaceuticals 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.
Weaknesses of IOL Chemicals Pharmaceuticals | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of IOL Chemicals Pharmaceuticals are -
Skills based hiring in Chemical Manufacturing industry
– The stress on hiring functional specialists at IOL Chemicals Pharmaceuticals 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.
High dependence on IOL Chemicals Pharmaceuticals ‘s star products
– The top 2 products and services of IOL Chemicals Pharmaceuticals 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 IOL Chemicals Pharmaceuticals has relatively successful track record of launching new products.
Ability to respond to the competition
– As the decision making is very deliberative at IOL Chemicals Pharmaceuticals, in the dynamic environment of Chemical Manufacturing industry it has struggled to respond to the nimble upstart competition. IOL Chemicals Pharmaceuticals has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Capital Spending Reduction
– Even during the low interest decade, IOL Chemicals Pharmaceuticals 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 Chemical Manufacturing industry using digital technology.
High cash cycle compare to competitors
IOL Chemicals Pharmaceuticals has a high cash cycle compare to other players in the Chemical Manufacturing industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
High bargaining power of channel partners in Chemical Manufacturing industry
– because of the regulatory requirements in India, IOL Chemicals Pharmaceuticals 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.
Slow decision making process
– As mentioned earlier in the report, IOL Chemicals Pharmaceuticals 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. IOL Chemicals Pharmaceuticals 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.
Workers concerns about automation
– As automation is fast increasing in the Chemical Manufacturing industry, IOL Chemicals Pharmaceuticals 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 strategic competitive environment developments
– As IOL Chemicals Pharmaceuticals is one of the leading players in the Chemical Manufacturing industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Chemical Manufacturing industry in last five years.
Aligning sales with marketing
– From the outside it seems that IOL Chemicals Pharmaceuticals 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 IOL Chemicals Pharmaceuticals can leverage the sales team experience to cultivate customer relationships as IOL Chemicals Pharmaceuticals is planning to shift buying processes online.
Compensation and incentives
– The revenue per employee of IOL Chemicals Pharmaceuticals 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.
IOL Chemicals Pharmaceuticals Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of IOL Chemicals Pharmaceuticals are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, IOL Chemicals Pharmaceuticals 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 IOL Chemicals Pharmaceuticals to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Leveraging digital technologies
– IOL Chemicals Pharmaceuticals 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
– IOL Chemicals Pharmaceuticals 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.
Building a culture of innovation
– managers at IOL Chemicals Pharmaceuticals 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, IOL Chemicals Pharmaceuticals can use these opportunities to build new business models that can help the communities that IOL Chemicals Pharmaceuticals operates in. Secondly it can use opportunities from government spending in Chemical Manufacturing sector.
Creating value in data economy
– The success of analytics program of IOL Chemicals Pharmaceuticals has opened avenues for new revenue streams for the organization in Chemical Manufacturing industry. This can help IOL Chemicals Pharmaceuticals to build a more holistic ecosystem for IOL Chemicals Pharmaceuticals products in the Chemical Manufacturing industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for IOL Chemicals Pharmaceuticals 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 IOL Chemicals Pharmaceuticals to hire the very best people irrespective of their geographical location.
Better consumer reach
– The expansion of the 5G network will help IOL Chemicals Pharmaceuticals to increase its market reach. IOL Chemicals Pharmaceuticals 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for IOL Chemicals Pharmaceuticals in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Chemical Manufacturing industry, and it will provide faster access to the consumers.
Low interest rates
– Even though inflation is raising its head in most developed economies, IOL Chemicals Pharmaceuticals 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.
Learning at scale
– Online learning technologies has now opened space for IOL Chemicals Pharmaceuticals 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects IOL Chemicals Pharmaceuticals can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Use of Bitcoin and other crypto currencies for transactions in Chemical Manufacturing industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for IOL Chemicals Pharmaceuticals in the Chemical Manufacturing industry. Now IOL Chemicals Pharmaceuticals can target international markets with far fewer capital restrictions requirements than the existing system.
Threats IOL Chemicals Pharmaceuticals External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of IOL Chemicals Pharmaceuticals are -
Consumer confidence and its impact on IOL Chemicals Pharmaceuticals 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 Chemical Manufacturing industry and other sectors.
Regulatory challenges
– IOL Chemicals Pharmaceuticals 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 Chemical Manufacturing industry regulations.
Stagnating economy with rate increase
– IOL Chemicals Pharmaceuticals 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, IOL Chemicals Pharmaceuticals 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 wage structure of IOL Chemicals Pharmaceuticals
– 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 IOL Chemicals Pharmaceuticals.
Environmental challenges
– IOL Chemicals Pharmaceuticals 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. IOL Chemicals Pharmaceuticals can take advantage of this fund but it will also bring new competitors in the Chemical Manufacturing industry.
Technology acceleration in Forth Industrial Revolution
– IOL Chemicals Pharmaceuticals has witnessed rapid integration of technology during Covid-19 in the Chemical Manufacturing industry. As one of the leading players in the industry, IOL Chemicals Pharmaceuticals needs to keep up with the evolution of technology in the Chemical Manufacturing 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 Chemical Manufacturing industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. IOL Chemicals Pharmaceuticals can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. IOL Chemicals Pharmaceuticals needs to understand the core reasons impacting the Chemical Manufacturing industry. This will help it in building a better workplace.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for IOL Chemicals Pharmaceuticals in Chemical Manufacturing industry. The Chemical Manufacturing 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.
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. IOL Chemicals Pharmaceuticals 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.
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 IOL Chemicals Pharmaceuticals.
Weighted SWOT Analysis of IOL Chemicals Pharmaceuticals Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at IOL Chemicals Pharmaceuticals 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 IOL Chemicals Pharmaceuticals 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 IOL Chemicals Pharmaceuticals 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 IOL Chemicals Pharmaceuticals 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 IOL Chemicals Pharmaceuticals needs to make to build a sustainable competitive advantage.
