SWOT Analysis / TOWS Matrix for PDS Multinational Fashions (India)
Based on various researches at Oak Spring University , PDS Multinational Fashions is operating in a macro-environment that has been destablized by – cloud computing is disrupting traditional business models, digital marketing is dominated by two big players Facebook and Google, increasing commodity prices, customer relationship management is fast transforming because of increasing concerns over data privacy, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing household debt because of falling income levels, increasing inequality as vast percentage of new income is going to the top 1%,
talent flight as more people leaving formal jobs, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of PDS Multinational Fashions
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that PDS Multinational Fashions can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the PDS Multinational Fashions, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which PDS Multinational Fashions 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 PDS Multinational Fashions can be done for the following purposes –
1. Strategic planning of PDS Multinational Fashions
2. Improving business portfolio management of PDS Multinational Fashions
3. Assessing feasibility of the new initiative in India
4. Making a Apparel/Accessories sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of PDS Multinational Fashions
Strengths of PDS Multinational Fashions | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of PDS Multinational Fashions are -
Innovation driven organization
– PDS Multinational Fashions is one of the most innovative firm in Apparel/Accessories sector.
Superior customer experience
– The customer experience strategy of PDS Multinational Fashions in Apparel/Accessories industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Operational resilience
– The operational resilience strategy of PDS Multinational Fashions comprises – understanding the underlying the factors in the Apparel/Accessories 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.
Organizational Resilience of PDS Multinational Fashions
– The covid-19 pandemic has put organizational resilience at the centre of everthing PDS Multinational Fashions does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Low bargaining power of suppliers
– Suppliers of PDS Multinational Fashions in the Consumer Cyclical sector have low bargaining power. PDS Multinational Fashions has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps PDS Multinational Fashions to manage not only supply disruptions but also source products at highly competitive prices.
Successful track record of launching new products
– PDS Multinational Fashions has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. PDS Multinational Fashions 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.
High switching costs
– The high switching costs that PDS Multinational Fashions 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.
Strong track record of project management in the Apparel/Accessories industry
– PDS Multinational Fashions is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Analytics focus
– PDS Multinational Fashions 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 Apparel/Accessories 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.
High brand equity
– PDS Multinational Fashions has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled PDS Multinational Fashions to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in Apparel/Accessories industry
– PDS Multinational Fashions has clearly differentiated products in the market place. This has enabled PDS Multinational Fashions to fetch slight price premium compare to the competitors in the Apparel/Accessories industry. The sustainable margins have also helped PDS Multinational Fashions to invest into research and development (R&D) and innovation.
Diverse revenue streams
– PDS Multinational Fashions is present in almost all the verticals within the Apparel/Accessories industry. This has provided PDS Multinational Fashions 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 PDS Multinational Fashions | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of PDS Multinational Fashions are -
Compensation and incentives
– The revenue per employee of PDS Multinational Fashions is just above the Apparel/Accessories 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.
High operating costs
– Compare to the competitors, PDS Multinational Fashions has high operating costs in the Apparel/Accessories industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract PDS Multinational Fashions lucrative customers.
Workers concerns about automation
– As automation is fast increasing in the Apparel/Accessories industry, PDS Multinational Fashions 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.
Increasing silos among functional specialists
– The organizational structure of PDS Multinational Fashions is dominated by functional specialists. It is not different from other players in the Apparel/Accessories industry, but PDS Multinational Fashions needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help PDS Multinational Fashions to focus more on services in the Apparel/Accessories industry rather than just following the product oriented approach.
Need for greater diversity
– PDS Multinational Fashions 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.
High cash cycle compare to competitors
PDS Multinational Fashions has a high cash cycle compare to other players in the Apparel/Accessories industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Employees’ less understanding of PDS Multinational Fashions strategy
– From the outside it seems that the employees of PDS Multinational Fashions don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
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 PDS Multinational Fashions supply chain. Even after few cautionary changes, PDS Multinational Fashions is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left PDS Multinational Fashions vulnerable to further global disruptions in South East Asia.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, PDS Multinational Fashions is slow explore the new channels of communication. These new channels of communication can help PDS Multinational Fashions to provide better information regarding Apparel/Accessories products and services. It can also build an online community to further reach out to potential customers.
Low market penetration in new markets
– Outside its home market of India, PDS Multinational Fashions needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow decision making process
– As mentioned earlier in the report, PDS Multinational Fashions has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Apparel/Accessories industry over the last five years. PDS Multinational Fashions 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.
PDS Multinational Fashions Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of PDS Multinational Fashions are -
Developing new processes and practices
– PDS Multinational Fashions can develop new processes and procedures in Apparel/Accessories 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, PDS Multinational Fashions can use these opportunities to build new business models that can help the communities that PDS Multinational Fashions operates in. Secondly it can use opportunities from government spending in Apparel/Accessories sector.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Apparel/Accessories industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. PDS Multinational Fashions 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. PDS Multinational Fashions 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, PDS Multinational Fashions 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.
Manufacturing automation
– PDS Multinational Fashions can use the latest technology developments to improve its manufacturing and designing process in Apparel/Accessories 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.
Leveraging digital technologies
– PDS Multinational Fashions 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, PDS Multinational Fashions is facing challenges because of the dominance of functional experts in the organization. PDS Multinational Fashions can utilize new technology in the field of Apparel/Accessories industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Learning at scale
– Online learning technologies has now opened space for PDS Multinational Fashions 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Apparel/Accessories industry, but it has also influenced the consumer preferences. PDS Multinational Fashions can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects PDS Multinational Fashions can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, PDS Multinational Fashions 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 PDS Multinational Fashions to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Creating value in data economy
– The success of analytics program of PDS Multinational Fashions has opened avenues for new revenue streams for the organization in Apparel/Accessories industry. This can help PDS Multinational Fashions to build a more holistic ecosystem for PDS Multinational Fashions products in the Apparel/Accessories 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 PDS Multinational Fashions 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 PDS Multinational Fashions to hire the very best people irrespective of their geographical location.
Threats PDS Multinational Fashions External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of PDS Multinational Fashions are -
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. PDS Multinational Fashions needs to understand the core reasons impacting the Apparel/Accessories industry. This will help it in building a better workplace.
Stagnating economy with rate increase
– PDS Multinational Fashions 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 Apparel/Accessories industry.
Environmental challenges
– PDS Multinational Fashions 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. PDS Multinational Fashions can take advantage of this fund but it will also bring new competitors in the Apparel/Accessories industry.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for PDS Multinational Fashions in the Apparel/Accessories sector and impact the bottomline of the organization.
High dependence on third party suppliers
– PDS Multinational Fashions 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.
Consumer confidence and its impact on PDS Multinational Fashions 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 Apparel/Accessories industry and other sectors.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for PDS Multinational Fashions in Apparel/Accessories industry. The Apparel/Accessories 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.
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. PDS Multinational Fashions 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Apparel/Accessories industry are lowering. It can presents PDS Multinational Fashions with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Apparel/Accessories sector.
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 PDS Multinational Fashions business can come under increasing regulations regarding data privacy, data security, etc.
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 PDS Multinational Fashions.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, PDS Multinational Fashions 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 PDS Multinational Fashions prominent markets.
Technology acceleration in Forth Industrial Revolution
– PDS Multinational Fashions has witnessed rapid integration of technology during Covid-19 in the Apparel/Accessories industry. As one of the leading players in the industry, PDS Multinational Fashions needs to keep up with the evolution of technology in the Apparel/Accessories 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.
Weighted SWOT Analysis of PDS Multinational Fashions Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at PDS Multinational Fashions 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 PDS Multinational Fashions 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 PDS Multinational Fashions 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 PDS Multinational Fashions 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 PDS Multinational Fashions needs to make to build a sustainable competitive advantage.