McNally Bharat Engg Co Ltd (MCNL) SWOT Analysis / TOWS Matrix / MBA Resources
Construction Services
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for McNally Bharat Engg Co Ltd (India)
Based on various researches at Oak Spring University , McNally Bharat Engg Co Ltd is operating in a macro-environment that has been destablized by – supply chains are disrupted by pandemic , there is backlash against globalization, increasing commodity prices, talent flight as more people leaving formal jobs, central banks are concerned over increasing inflation, competitive advantages are harder to sustain because of technology dispersion, cloud computing is disrupting traditional business models,
increasing government debt because of Covid-19 spendings, geopolitical disruptions, etc
Introduction to SWOT Analysis of McNally Bharat Engg Co Ltd
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that McNally Bharat Engg Co Ltd can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the McNally Bharat Engg Co Ltd, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which McNally Bharat Engg Co 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 McNally Bharat Engg Co Ltd can be done for the following purposes –
1. Strategic planning of McNally Bharat Engg Co Ltd
2. Improving business portfolio management of McNally Bharat Engg Co Ltd
3. Assessing feasibility of the new initiative in India
4. Making a Construction Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of McNally Bharat Engg Co Ltd
Strengths of McNally Bharat Engg Co Ltd | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of McNally Bharat Engg Co Ltd are -
Learning organization
- McNally Bharat Engg Co Ltd 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 McNally Bharat Engg Co Ltd is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at McNally Bharat Engg Co Ltd emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in Construction Services industry
– McNally Bharat Engg Co Ltd has clearly differentiated products in the market place. This has enabled McNally Bharat Engg Co Ltd to fetch slight price premium compare to the competitors in the Construction Services industry. The sustainable margins have also helped McNally Bharat Engg Co Ltd to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– McNally Bharat Engg Co Ltd has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Construction Services industry. Secondly the value chain collaborators of McNally Bharat Engg Co Ltd have helped the firm to develop new products and bring them quickly to the marketplace.
Operational resilience
– The operational resilience strategy of McNally Bharat Engg Co Ltd comprises – understanding the underlying the factors in the Construction Services 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.
Strong track record of project management in the Construction Services industry
– McNally Bharat Engg Co 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.
Organizational Resilience of McNally Bharat Engg Co Ltd
– The covid-19 pandemic has put organizational resilience at the centre of everthing McNally Bharat Engg Co Ltd does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Innovation driven organization
– McNally Bharat Engg Co Ltd is one of the most innovative firm in Construction Services sector.
Ability to lead change in Construction Services
– McNally Bharat Engg Co Ltd is one of the leading players in the Construction Services industry in India. Over the years it has not only transformed the business landscape in the Construction Services industry in India but also across the existing markets. The ability to lead change has enabled McNally Bharat Engg Co Ltd in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Low bargaining power of suppliers
– Suppliers of McNally Bharat Engg Co Ltd in the Capital Goods sector have low bargaining power. McNally Bharat Engg Co Ltd has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps McNally Bharat Engg Co Ltd to manage not only supply disruptions but also source products at highly competitive prices.
Ability to recruit top talent
– McNally Bharat Engg Co Ltd is one of the leading players in the Construction Services 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.
Digital Transformation in Construction Services industry
- digital transformation varies from industry to industry. For McNally Bharat Engg Co Ltd digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. McNally Bharat Engg Co 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.
Effective Research and Development (R&D)
– McNally Bharat Engg Co Ltd has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – McNally Bharat Engg Co Ltd staying ahead in the Construction Services industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses of McNally Bharat Engg Co Ltd | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of McNally Bharat Engg Co Ltd are -
Workers concerns about automation
– As automation is fast increasing in the Construction Services industry, McNally Bharat Engg Co 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.
Skills based hiring in Construction Services industry
– The stress on hiring functional specialists at McNally Bharat Engg Co 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, McNally Bharat Engg Co 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 Construction Services industry over the last five years. McNally Bharat Engg Co 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.
Aligning sales with marketing
– From the outside it seems that McNally Bharat Engg Co Ltd needs to have more collaboration between its sales team and marketing team. Sales professionals in the Construction Services industry have deep experience in developing customer relationships. Marketing department at McNally Bharat Engg Co Ltd can leverage the sales team experience to cultivate customer relationships as McNally Bharat Engg Co Ltd is planning to shift buying processes online.
Compensation and incentives
– The revenue per employee of McNally Bharat Engg Co Ltd is just above the Construction Services 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.
Slow to strategic competitive environment developments
– As McNally Bharat Engg Co Ltd is one of the leading players in the Construction Services industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Construction Services industry in last five years.
Need for greater diversity
– McNally Bharat Engg Co Ltd 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.
Products dominated business model
– Even though McNally Bharat Engg Co Ltd has some of the most successful models in the Construction Services industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. McNally Bharat Engg Co Ltd should strive to include more intangible value offerings along with its core products and services.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, McNally Bharat Engg Co Ltd is slow explore the new channels of communication. These new channels of communication can help McNally Bharat Engg Co Ltd to provide better information regarding Construction Services products and services. It can also build an online community to further reach out to potential customers.
High dependence on McNally Bharat Engg Co Ltd ‘s star products
– The top 2 products and services of McNally Bharat Engg Co Ltd still accounts for major business revenue. This dependence on star products in Construction Services industry has resulted into insufficient focus on developing new products, even though McNally Bharat Engg Co Ltd has relatively successful track record of launching new products.
Lack of clear differentiation of McNally Bharat Engg Co Ltd products
– To increase the profitability and margins on the products, McNally Bharat Engg Co Ltd needs to provide more differentiated products than what it is currently offering in the marketplace.
McNally Bharat Engg Co Ltd Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of McNally Bharat Engg Co Ltd are -
Buying journey improvements
– McNally Bharat Engg Co Ltd can improve the customer journey of consumers in the Construction Services 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.
Loyalty marketing
– McNally Bharat Engg Co Ltd 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Construction Services industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. McNally Bharat Engg Co Ltd 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. McNally Bharat Engg Co Ltd can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Building a culture of innovation
– managers at McNally Bharat Engg Co 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 Construction Services industry.
Low interest rates
– Even though inflation is raising its head in most developed economies, McNally Bharat Engg Co 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.
Learning at scale
– Online learning technologies has now opened space for McNally Bharat Engg Co Ltd 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.
Using analytics as competitive advantage
– McNally Bharat Engg Co Ltd has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Construction Services sector. This continuous investment in analytics has enabled McNally Bharat Engg Co Ltd to build a competitive advantage using analytics. The analytics driven competitive advantage can help McNally Bharat Engg Co Ltd to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Construction Services industry, but it has also influenced the consumer preferences. McNally Bharat Engg Co Ltd can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, McNally Bharat Engg Co Ltd 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 McNally Bharat Engg Co Ltd 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 McNally Bharat Engg Co Ltd has opened avenues for new revenue streams for the organization in Construction Services industry. This can help McNally Bharat Engg Co Ltd to build a more holistic ecosystem for McNally Bharat Engg Co Ltd products in the Construction Services industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Leveraging digital technologies
– McNally Bharat Engg Co 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for McNally Bharat Engg Co Ltd 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 McNally Bharat Engg Co Ltd to hire the very best people irrespective of their geographical location.
Developing new processes and practices
– McNally Bharat Engg Co Ltd can develop new processes and procedures in Construction Services 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.
Threats McNally Bharat Engg Co Ltd External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of McNally Bharat Engg Co Ltd are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, McNally Bharat Engg Co 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 McNally Bharat Engg Co Ltd prominent markets.
Regulatory challenges
– McNally Bharat Engg Co Ltd 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 Construction Services industry regulations.
Easy access to finance
– Easy access to finance in Construction Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. McNally Bharat Engg Co Ltd 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. McNally Bharat Engg Co Ltd needs to understand the core reasons impacting the Construction Services industry. This will help it in building a better workplace.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Construction Services industry are lowering. It can presents McNally Bharat Engg Co Ltd with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Construction Services sector.
Shortening product life cycle
– it is one of the major threat that McNally Bharat Engg Co Ltd is facing in Construction Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
High dependence on third party suppliers
– McNally Bharat Engg Co Ltd 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.
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 McNally Bharat Engg Co Ltd in the Construction Services sector and impact the bottomline of the organization.
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 McNally Bharat Engg Co Ltd business can come under increasing regulations regarding data privacy, data security, etc.
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. McNally Bharat Engg Co Ltd 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.
Consumer confidence and its impact on McNally Bharat Engg Co 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 Construction Services industry and other sectors.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, McNally Bharat Engg Co 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 Construction Services sector.
Weighted SWOT Analysis of McNally Bharat Engg Co Ltd Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at McNally Bharat Engg Co 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 McNally Bharat Engg Co 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 McNally Bharat Engg Co 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 McNally Bharat Engg Co 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 McNally Bharat Engg Co Ltd needs to make to build a sustainable competitive advantage.