Based on various researches at Oak Spring University , Linc Pen & Plastics Ltd is operating in a macro-environment that has been destablized by – increasing inequality as vast percentage of new income is going to the top 1%, digital marketing is dominated by two big players Facebook and Google, increasing commodity prices, cloud computing is disrupting traditional business models, customer relationship management is fast transforming because of increasing concerns over data privacy, talent flight as more people leaving formal jobs, wage bills are increasing,
there is increasing trade war between United States & China, increasing energy prices, etc
Introduction to SWOT Analysis of Linc Pen & Plastics Ltd
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Linc Pen & Plastics Ltd can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Linc Pen & Plastics Ltd, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Linc Pen & Plastics Ltd 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 Linc Pen & Plastics Ltd can be done for the following purposes –
1. Strategic planning of Linc Pen & Plastics Ltd
2. Improving business portfolio management of Linc Pen & Plastics Ltd
3. Assessing feasibility of the new initiative in India
4. Making a Office Supplies sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Linc Pen & Plastics Ltd
Strengths of Linc Pen & Plastics Ltd | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Linc Pen & Plastics Ltd are -
High brand equity
– Linc Pen & Plastics Ltd has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Linc Pen & Plastics Ltd to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Analytics focus
– Linc Pen & Plastics Ltd 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 Office Supplies 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.
Cross disciplinary teams
– Horizontal connected teams at the Linc Pen & Plastics Ltd are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
High switching costs
– The high switching costs that Linc Pen & Plastics Ltd 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.
Innovation driven organization
– Linc Pen & Plastics Ltd is one of the most innovative firm in Office Supplies sector.
Strong track record of project management in the Office Supplies industry
– Linc Pen & Plastics Ltd is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Diverse revenue streams
– Linc Pen & Plastics Ltd is present in almost all the verticals within the Office Supplies industry. This has provided Linc Pen & Plastics Ltd 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.
Effective Research and Development (R&D)
– Linc Pen & Plastics Ltd has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Linc Pen & Plastics Ltd staying ahead in the Office Supplies industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Low bargaining power of suppliers
– Suppliers of Linc Pen & Plastics Ltd in the Consumer/Non-Cyclical sector have low bargaining power. Linc Pen & Plastics Ltd has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Linc Pen & Plastics Ltd to manage not only supply disruptions but also source products at highly competitive prices.
Successful track record of launching new products
– Linc Pen & Plastics Ltd has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Linc Pen & Plastics Ltd 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.
Superior customer experience
– The customer experience strategy of Linc Pen & Plastics Ltd in Office Supplies industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Digital Transformation in Office Supplies industry
- digital transformation varies from industry to industry. For Linc Pen & Plastics Ltd digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Linc Pen & Plastics Ltd has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Weaknesses of Linc Pen & Plastics Ltd | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Linc Pen & Plastics Ltd are -
Workers concerns about automation
– As automation is fast increasing in the Office Supplies industry, Linc Pen & Plastics Ltd 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 Linc Pen & Plastics Ltd is dominated by functional specialists. It is not different from other players in the Office Supplies industry, but Linc Pen & Plastics Ltd needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Linc Pen & Plastics Ltd to focus more on services in the Office Supplies industry rather than just following the product oriented approach.
Skills based hiring in Office Supplies industry
– The stress on hiring functional specialists at Linc Pen & Plastics Ltd has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Slow decision making process
– As mentioned earlier in the report, Linc Pen & Plastics Ltd has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Office Supplies industry over the last five years. Linc Pen & Plastics Ltd 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.
High dependence on Linc Pen & Plastics Ltd ‘s star products
– The top 2 products and services of Linc Pen & Plastics Ltd still accounts for major business revenue. This dependence on star products in Office Supplies industry has resulted into insufficient focus on developing new products, even though Linc Pen & Plastics Ltd has relatively successful track record of launching new products.
High bargaining power of channel partners in Office Supplies industry
– because of the regulatory requirements in India, Linc Pen & Plastics Ltd 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 Office Supplies industry.
High cash cycle compare to competitors
Linc Pen & Plastics Ltd has a high cash cycle compare to other players in the Office Supplies industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Linc Pen & Plastics Ltd is slow explore the new channels of communication. These new channels of communication can help Linc Pen & Plastics Ltd to provide better information regarding Office Supplies products and services. It can also build an online community to further reach out to potential customers.
Lack of clear differentiation of Linc Pen & Plastics Ltd products
– To increase the profitability and margins on the products, Linc Pen & Plastics Ltd needs to provide more differentiated products than what it is currently offering in the marketplace.
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 Linc Pen & Plastics Ltd supply chain. Even after few cautionary changes, Linc Pen & Plastics Ltd is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Linc Pen & Plastics Ltd vulnerable to further global disruptions in South East Asia.
Interest costs
– Compare to the competition, Linc Pen & Plastics Ltd 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.
Linc Pen & Plastics Ltd Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Linc Pen & Plastics Ltd are -
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Office Supplies industry, but it has also influenced the consumer preferences. Linc Pen & Plastics Ltd can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Linc Pen & Plastics Ltd in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Office Supplies industry, and it will provide faster access to the consumers.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Linc Pen & Plastics Ltd is facing challenges because of the dominance of functional experts in the organization. Linc Pen & Plastics Ltd can utilize new technology in the field of Office Supplies industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Linc Pen & Plastics Ltd to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Use of Bitcoin and other crypto currencies for transactions in Office Supplies industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Linc Pen & Plastics Ltd in the Office Supplies industry. Now Linc Pen & Plastics Ltd can target international markets with far fewer capital restrictions requirements than the existing system.
Building a culture of innovation
– managers at Linc Pen & Plastics Ltd 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 Office Supplies industry.
Creating value in data economy
– The success of analytics program of Linc Pen & Plastics Ltd has opened avenues for new revenue streams for the organization in Office Supplies industry. This can help Linc Pen & Plastics Ltd to build a more holistic ecosystem for Linc Pen & Plastics Ltd products in the Office Supplies industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– Linc Pen & Plastics Ltd has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Office Supplies sector. This continuous investment in analytics has enabled Linc Pen & Plastics Ltd to build a competitive advantage using analytics. The analytics driven competitive advantage can help Linc Pen & Plastics Ltd to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Linc Pen & Plastics Ltd can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Leveraging digital technologies
– Linc Pen & Plastics Ltd 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
– Linc Pen & Plastics Ltd can develop new processes and procedures in Office Supplies 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, Linc Pen & Plastics Ltd 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.
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. Linc Pen & Plastics Ltd can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats Linc Pen & Plastics Ltd External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Linc Pen & Plastics Ltd are -
Stagnating economy with rate increase
– Linc Pen & Plastics Ltd 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 Office Supplies industry.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Office Supplies industry are lowering. It can presents Linc Pen & Plastics Ltd with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Office Supplies sector.
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 Linc Pen & Plastics Ltd.
Environmental challenges
– Linc Pen & Plastics Ltd 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. Linc Pen & Plastics Ltd can take advantage of this fund but it will also bring new competitors in the Office Supplies industry.
Shortening product life cycle
– it is one of the major threat that Linc Pen & Plastics Ltd is facing in Office Supplies sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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.
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. Linc Pen & Plastics Ltd needs to understand the core reasons impacting the Office Supplies industry. This will help it in building a better workplace.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Linc Pen & Plastics Ltd 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 Linc Pen & Plastics Ltd prominent markets.
Technology acceleration in Forth Industrial Revolution
– Linc Pen & Plastics Ltd has witnessed rapid integration of technology during Covid-19 in the Office Supplies industry. As one of the leading players in the industry, Linc Pen & Plastics Ltd needs to keep up with the evolution of technology in the Office Supplies 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 Office Supplies industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Linc Pen & Plastics Ltd can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Linc Pen & Plastics Ltd 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, Linc Pen & Plastics Ltd may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Office Supplies sector.
Consumer confidence and its impact on Linc Pen & Plastics Ltd 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 Office Supplies industry and other sectors.
Weighted SWOT Analysis of Linc Pen & Plastics Ltd Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Linc Pen & Plastics Ltd 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 Linc Pen & Plastics Ltd 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 Linc Pen & Plastics Ltd 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 Linc Pen & Plastics Ltd 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 Linc Pen & Plastics Ltd needs to make to build a sustainable competitive advantage.