SWOT Analysis / TOWS Matrix for SPL Industries Ltd (India)
Based on various researches at Oak Spring University , SPL Industries Ltd is operating in a macro-environment that has been destablized by – competitive advantages are harder to sustain because of technology dispersion, customer relationship management is fast transforming because of increasing concerns over data privacy, supply chains are disrupted by pandemic , geopolitical disruptions, cloud computing is disrupting traditional business models, technology disruption, digital marketing is dominated by two big players Facebook and Google,
talent flight as more people leaving formal jobs, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of SPL Industries Ltd
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that SPL Industries Ltd can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the SPL Industries Ltd, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which SPL Industries 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 SPL Industries Ltd can be done for the following purposes –
1. Strategic planning of SPL Industries Ltd
2. Improving business portfolio management of SPL Industries Ltd
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 SPL Industries Ltd
Strengths of SPL Industries Ltd | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of SPL Industries Ltd are -
Digital Transformation in Apparel/Accessories industry
- digital transformation varies from industry to industry. For SPL Industries Ltd digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. SPL Industries 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.
Cross disciplinary teams
– Horizontal connected teams at the SPL Industries 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.
Ability to lead change in Apparel/Accessories
– SPL Industries Ltd is one of the leading players in the Apparel/Accessories industry in India. Over the years it has not only transformed the business landscape in the Apparel/Accessories industry in India but also across the existing markets. The ability to lead change has enabled SPL Industries Ltd in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Sustainable margins compare to other players in Apparel/Accessories industry
– SPL Industries Ltd has clearly differentiated products in the market place. This has enabled SPL Industries Ltd to fetch slight price premium compare to the competitors in the Apparel/Accessories industry. The sustainable margins have also helped SPL Industries Ltd to invest into research and development (R&D) and innovation.
Successful track record of launching new products
– SPL Industries Ltd has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. SPL Industries 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.
Diverse revenue streams
– SPL Industries Ltd is present in almost all the verticals within the Apparel/Accessories industry. This has provided SPL Industries 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)
– SPL Industries Ltd has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – SPL Industries Ltd staying ahead in the Apparel/Accessories industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Analytics focus
– SPL Industries 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 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.
Ability to recruit top talent
– SPL Industries Ltd is one of the leading players in the Apparel/Accessories 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.
Highly skilled collaborators
– SPL Industries Ltd has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Apparel/Accessories industry. Secondly the value chain collaborators of SPL Industries Ltd have helped the firm to develop new products and bring them quickly to the marketplace.
Learning organization
- SPL Industries 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 SPL Industries Ltd is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at SPL Industries Ltd emphasize – knowledge, initiative, and innovation.
Superior customer experience
– The customer experience strategy of SPL Industries Ltd in Apparel/Accessories industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses of SPL Industries Ltd | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of SPL Industries Ltd are -
No frontier risks strategy
– From the 10K / annual statement of SPL Industries Ltd, it seems that company is thinking out the frontier risks that can impact Apparel/Accessories industry. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
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 SPL Industries Ltd supply chain. Even after few cautionary changes, SPL Industries Ltd is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left SPL Industries Ltd vulnerable to further global disruptions in South East Asia.
Compensation and incentives
– The revenue per employee of SPL Industries Ltd 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.
Ability to respond to the competition
– As the decision making is very deliberative at SPL Industries Ltd, in the dynamic environment of Apparel/Accessories industry it has struggled to respond to the nimble upstart competition. SPL Industries Ltd has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High dependence on SPL Industries Ltd ‘s star products
– The top 2 products and services of SPL Industries Ltd still accounts for major business revenue. This dependence on star products in Apparel/Accessories industry has resulted into insufficient focus on developing new products, even though SPL Industries Ltd has relatively successful track record of launching new products.
Aligning sales with marketing
– From the outside it seems that SPL Industries Ltd needs to have more collaboration between its sales team and marketing team. Sales professionals in the Apparel/Accessories industry have deep experience in developing customer relationships. Marketing department at SPL Industries Ltd can leverage the sales team experience to cultivate customer relationships as SPL Industries Ltd is planning to shift buying processes online.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, SPL Industries Ltd is slow explore the new channels of communication. These new channels of communication can help SPL Industries Ltd to provide better information regarding Apparel/Accessories products and services. It can also build an online community to further reach out to potential customers.
Lack of clear differentiation of SPL Industries Ltd products
– To increase the profitability and margins on the products, SPL Industries Ltd needs to provide more differentiated products than what it is currently offering in the marketplace.
High operating costs
– Compare to the competitors, SPL Industries Ltd 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 SPL Industries Ltd lucrative customers.
Increasing silos among functional specialists
– The organizational structure of SPL Industries Ltd is dominated by functional specialists. It is not different from other players in the Apparel/Accessories industry, but SPL Industries Ltd needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help SPL Industries Ltd to focus more on services in the Apparel/Accessories industry rather than just following the product oriented approach.
Employees’ less understanding of SPL Industries Ltd strategy
– From the outside it seems that the employees of SPL Industries Ltd 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.
SPL Industries Ltd Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of SPL Industries Ltd are -
Building a culture of innovation
– managers at SPL Industries 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 Apparel/Accessories industry.
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 SPL Industries 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.
Buying journey improvements
– SPL Industries Ltd can improve the customer journey of consumers in the Apparel/Accessories 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.
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. SPL Industries Ltd can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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. SPL Industries 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. SPL Industries 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, SPL Industries Ltd can use these opportunities to build new business models that can help the communities that SPL Industries Ltd operates in. Secondly it can use opportunities from government spending in Apparel/Accessories sector.
Using analytics as competitive advantage
– SPL Industries Ltd has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Apparel/Accessories sector. This continuous investment in analytics has enabled SPL Industries Ltd to build a competitive advantage using analytics. The analytics driven competitive advantage can help SPL Industries 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 Apparel/Accessories industry, but it has also influenced the consumer preferences. SPL Industries 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, SPL Industries 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 SPL Industries 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.
Better consumer reach
– The expansion of the 5G network will help SPL Industries Ltd to increase its market reach. SPL Industries Ltd 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, SPL Industries Ltd is facing challenges because of the dominance of functional experts in the organization. SPL Industries Ltd 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.
Manufacturing automation
– SPL Industries Ltd 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.
Developing new processes and practices
– SPL Industries Ltd 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.
Threats SPL Industries Ltd External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of SPL Industries Ltd are -
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.
Technology acceleration in Forth Industrial Revolution
– SPL Industries Ltd has witnessed rapid integration of technology during Covid-19 in the Apparel/Accessories industry. As one of the leading players in the industry, SPL Industries Ltd 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.
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 SPL Industries Ltd business can come under increasing regulations regarding data privacy, data security, etc.
Regulatory challenges
– SPL Industries 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 Apparel/Accessories industry regulations.
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 SPL Industries Ltd.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, SPL Industries 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 Apparel/Accessories sector.
Easy access to finance
– Easy access to finance in Apparel/Accessories industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. SPL Industries Ltd can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Apparel/Accessories industry are lowering. It can presents SPL Industries Ltd with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Apparel/Accessories sector.
Stagnating economy with rate increase
– SPL Industries 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 Apparel/Accessories industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, SPL Industries 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 SPL Industries Ltd prominent markets.
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.
Shortening product life cycle
– it is one of the major threat that SPL Industries Ltd is facing in Apparel/Accessories sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
High dependence on third party suppliers
– SPL Industries 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.
Weighted SWOT Analysis of SPL Industries Ltd Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at SPL Industries 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 SPL Industries 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 SPL Industries 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 SPL Industries 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 SPL Industries Ltd needs to make to build a sustainable competitive advantage.
