SWOT Analysis / TOWS Matrix for Kesar Terminals (India)
Based on various researches at Oak Spring University , Kesar Terminals is operating in a macro-environment that has been destablized by – increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing commodity prices, supply chains are disrupted by pandemic , increasing inequality as vast percentage of new income is going to the top 1%, customer relationship management is fast transforming because of increasing concerns over data privacy,
competitive advantages are harder to sustain because of technology dispersion, geopolitical disruptions, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Kesar Terminals can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Kesar Terminals, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Kesar Terminals 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 Kesar Terminals can be done for the following purposes –
1. Strategic planning of Kesar Terminals
2. Improving business portfolio management of Kesar Terminals
3. Assessing feasibility of the new initiative in India
4. Making a Misc. Transportation sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Kesar Terminals
Strengths of Kesar Terminals | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Kesar Terminals are -
High brand equity
– Kesar Terminals has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Kesar Terminals to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Kesar Terminals is present in almost all the verticals within the Misc. Transportation industry. This has provided Kesar Terminals 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.
Ability to recruit top talent
– Kesar Terminals is one of the leading players in the Misc. Transportation 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.
Effective Research and Development (R&D)
– Kesar Terminals has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Kesar Terminals staying ahead in the Misc. Transportation industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Operational resilience
– The operational resilience strategy of Kesar Terminals comprises – understanding the underlying the factors in the Misc. Transportation 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 Kesar Terminals
– The covid-19 pandemic has put organizational resilience at the centre of everthing Kesar Terminals does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Superior customer experience
– The customer experience strategy of Kesar Terminals in Misc. Transportation industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Sustainable margins compare to other players in Misc. Transportation industry
– Kesar Terminals has clearly differentiated products in the market place. This has enabled Kesar Terminals to fetch slight price premium compare to the competitors in the Misc. Transportation industry. The sustainable margins have also helped Kesar Terminals to invest into research and development (R&D) and innovation.
Low bargaining power of suppliers
– Suppliers of Kesar Terminals in the Transportation sector have low bargaining power. Kesar Terminals has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Kesar Terminals to manage not only supply disruptions but also source products at highly competitive prices.
Learning organization
- Kesar Terminals 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 Kesar Terminals is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Kesar Terminals emphasize – knowledge, initiative, and innovation.
Digital Transformation in Misc. Transportation industry
- digital transformation varies from industry to industry. For Kesar Terminals digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Kesar Terminals 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 Kesar Terminals 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.
Weaknesses of Kesar Terminals | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Kesar Terminals are -
Need for greater diversity
– Kesar Terminals 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.
Increasing silos among functional specialists
– The organizational structure of Kesar Terminals is dominated by functional specialists. It is not different from other players in the Misc. Transportation industry, but Kesar Terminals needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Kesar Terminals to focus more on services in the Misc. Transportation industry rather than just following the product oriented approach.
Workers concerns about automation
– As automation is fast increasing in the Misc. Transportation industry, Kesar Terminals 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.
Aligning sales with marketing
– From the outside it seems that Kesar Terminals needs to have more collaboration between its sales team and marketing team. Sales professionals in the Misc. Transportation industry have deep experience in developing customer relationships. Marketing department at Kesar Terminals can leverage the sales team experience to cultivate customer relationships as Kesar Terminals 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, Kesar Terminals is slow explore the new channels of communication. These new channels of communication can help Kesar Terminals to provide better information regarding Misc. Transportation products and services. It can also build an online community to further reach out to potential customers.
Skills based hiring in Misc. Transportation industry
– The stress on hiring functional specialists at Kesar Terminals 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.
Compensation and incentives
– The revenue per employee of Kesar Terminals is just above the Misc. Transportation 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 Kesar Terminals is one of the leading players in the Misc. Transportation industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Misc. Transportation industry in last five years.
Lack of clear differentiation of Kesar Terminals products
– To increase the profitability and margins on the products, Kesar Terminals needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Kesar Terminals has a high cash cycle compare to other players in the Misc. Transportation industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
High dependence on Kesar Terminals ‘s star products
– The top 2 products and services of Kesar Terminals still accounts for major business revenue. This dependence on star products in Misc. Transportation industry has resulted into insufficient focus on developing new products, even though Kesar Terminals has relatively successful track record of launching new products.
Kesar Terminals Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Kesar Terminals are -
Leveraging digital technologies
– Kesar Terminals 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.
Better consumer reach
– The expansion of the 5G network will help Kesar Terminals to increase its market reach. Kesar Terminals 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.
Creating value in data economy
– The success of analytics program of Kesar Terminals has opened avenues for new revenue streams for the organization in Misc. Transportation industry. This can help Kesar Terminals to build a more holistic ecosystem for Kesar Terminals products in the Misc. Transportation industry by providing – data insight services, data privacy related products, data based consulting services, 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 Kesar Terminals 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Kesar Terminals 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Misc. Transportation industry, but it has also influenced the consumer preferences. Kesar Terminals can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Using analytics as competitive advantage
– Kesar Terminals has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Misc. Transportation sector. This continuous investment in analytics has enabled Kesar Terminals to build a competitive advantage using analytics. The analytics driven competitive advantage can help Kesar Terminals to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Misc. Transportation industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Kesar Terminals 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. Kesar Terminals 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Kesar Terminals in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Misc. Transportation industry, and it will provide faster access to the consumers.
Loyalty marketing
– Kesar Terminals 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.
Buying journey improvements
– Kesar Terminals can improve the customer journey of consumers in the Misc. Transportation 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Kesar Terminals can use these opportunities to build new business models that can help the communities that Kesar Terminals operates in. Secondly it can use opportunities from government spending in Misc. Transportation sector.
Use of Bitcoin and other crypto currencies for transactions in Misc. Transportation industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Kesar Terminals in the Misc. Transportation industry. Now Kesar Terminals can target international markets with far fewer capital restrictions requirements than the existing system.
Threats Kesar Terminals External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Kesar Terminals are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Kesar Terminals in Misc. Transportation industry. The Misc. Transportation 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. Kesar Terminals 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.
Environmental challenges
– Kesar Terminals 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. Kesar Terminals can take advantage of this fund but it will also bring new competitors in the Misc. Transportation 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 Kesar Terminals in the Misc. Transportation sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Kesar Terminals 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.
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.
Easy access to finance
– Easy access to finance in Misc. Transportation industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Kesar Terminals 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. Kesar Terminals needs to understand the core reasons impacting the Misc. Transportation industry. This will help it in building a better workplace.
Stagnating economy with rate increase
– Kesar Terminals 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 Misc. Transportation industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Kesar Terminals 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 Kesar Terminals prominent markets.
Consumer confidence and its impact on Kesar Terminals 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 Misc. Transportation industry and other sectors.
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 Kesar Terminals.
Increasing wage structure of Kesar Terminals
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Kesar Terminals.
Weighted SWOT Analysis of Kesar Terminals Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Kesar Terminals 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 Kesar Terminals 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 Kesar Terminals 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 Kesar Terminals 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 Kesar Terminals needs to make to build a sustainable competitive advantage.
