ESS DEE Aluminum (ESDA) SWOT Analysis / TOWS Matrix / MBA Resources
Misc. Fabricated Products
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for ESS DEE Aluminum (India)
Based on various researches at Oak Spring University , ESS DEE Aluminum is operating in a macro-environment that has been destablized by – increasing household debt because of falling income levels, increasing transportation and logistics costs, there is backlash against globalization, talent flight as more people leaving formal jobs, geopolitical disruptions, increasing commodity prices, digital marketing is dominated by two big players Facebook and Google,
increasing inequality as vast percentage of new income is going to the top 1%, cloud computing is disrupting traditional business models, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that ESS DEE Aluminum can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the ESS DEE Aluminum, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which ESS DEE Aluminum 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 ESS DEE Aluminum can be done for the following purposes –
1. Strategic planning of ESS DEE Aluminum
2. Improving business portfolio management of ESS DEE Aluminum
3. Assessing feasibility of the new initiative in India
4. Making a Misc. Fabricated Products sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of ESS DEE Aluminum
Strengths of ESS DEE Aluminum | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of ESS DEE Aluminum are -
Strong track record of project management in the Misc. Fabricated Products industry
– ESS DEE Aluminum is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to recruit top talent
– ESS DEE Aluminum is one of the leading players in the Misc. Fabricated Products 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.
Ability to lead change in Misc. Fabricated Products
– ESS DEE Aluminum is one of the leading players in the Misc. Fabricated Products industry in India. Over the years it has not only transformed the business landscape in the Misc. Fabricated Products industry in India but also across the existing markets. The ability to lead change has enabled ESS DEE Aluminum in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High switching costs
– The high switching costs that ESS DEE Aluminum 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.
High brand equity
– ESS DEE Aluminum has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled ESS DEE Aluminum to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Learning organization
- ESS DEE Aluminum 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 ESS DEE Aluminum is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at ESS DEE Aluminum emphasize – knowledge, initiative, and innovation.
Effective Research and Development (R&D)
– ESS DEE Aluminum has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – ESS DEE Aluminum staying ahead in the Misc. Fabricated Products industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Superior customer experience
– The customer experience strategy of ESS DEE Aluminum in Misc. Fabricated Products industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the ESS DEE Aluminum 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.
Diverse revenue streams
– ESS DEE Aluminum is present in almost all the verticals within the Misc. Fabricated Products industry. This has provided ESS DEE Aluminum 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.
Sustainable margins compare to other players in Misc. Fabricated Products industry
– ESS DEE Aluminum has clearly differentiated products in the market place. This has enabled ESS DEE Aluminum to fetch slight price premium compare to the competitors in the Misc. Fabricated Products industry. The sustainable margins have also helped ESS DEE Aluminum to invest into research and development (R&D) and innovation.
Organizational Resilience of ESS DEE Aluminum
– The covid-19 pandemic has put organizational resilience at the centre of everthing ESS DEE Aluminum does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses of ESS DEE Aluminum | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of ESS DEE Aluminum are -
Compensation and incentives
– The revenue per employee of ESS DEE Aluminum is just above the Misc. Fabricated Products 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.
Aligning sales with marketing
– From the outside it seems that ESS DEE Aluminum needs to have more collaboration between its sales team and marketing team. Sales professionals in the Misc. Fabricated Products industry have deep experience in developing customer relationships. Marketing department at ESS DEE Aluminum can leverage the sales team experience to cultivate customer relationships as ESS DEE Aluminum is planning to shift buying processes online.
Low market penetration in new markets
– Outside its home market of India, ESS DEE Aluminum needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Interest costs
– Compare to the competition, ESS DEE Aluminum 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.
High bargaining power of channel partners in Misc. Fabricated Products industry
– because of the regulatory requirements in India, ESS DEE Aluminum 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 Misc. Fabricated Products industry.
Skills based hiring in Misc. Fabricated Products industry
– The stress on hiring functional specialists at ESS DEE Aluminum 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 to strategic competitive environment developments
– As ESS DEE Aluminum is one of the leading players in the Misc. Fabricated Products industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Misc. Fabricated Products industry in last five years.
Workers concerns about automation
– As automation is fast increasing in the Misc. Fabricated Products industry, ESS DEE Aluminum 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.
Lack of clear differentiation of ESS DEE Aluminum products
– To increase the profitability and margins on the products, ESS DEE Aluminum needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow decision making process
– As mentioned earlier in the report, ESS DEE Aluminum has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Misc. Fabricated Products industry over the last five years. ESS DEE Aluminum 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.
Products dominated business model
– Even though ESS DEE Aluminum has some of the most successful models in the Misc. Fabricated Products industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. ESS DEE Aluminum should strive to include more intangible value offerings along with its core products and services.
ESS DEE Aluminum Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of ESS DEE Aluminum are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for ESS DEE Aluminum 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 ESS DEE Aluminum to hire the very best people irrespective of their geographical location.
Buying journey improvements
– ESS DEE Aluminum can improve the customer journey of consumers in the Misc. Fabricated Products 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects ESS DEE Aluminum can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 ESS DEE Aluminum 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, ESS DEE Aluminum can use these opportunities to build new business models that can help the communities that ESS DEE Aluminum operates in. Secondly it can use opportunities from government spending in Misc. Fabricated Products sector.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, ESS DEE Aluminum 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 ESS DEE Aluminum to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Building a culture of innovation
– managers at ESS DEE Aluminum 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 Misc. Fabricated Products industry.
Creating value in data economy
– The success of analytics program of ESS DEE Aluminum has opened avenues for new revenue streams for the organization in Misc. Fabricated Products industry. This can help ESS DEE Aluminum to build a more holistic ecosystem for ESS DEE Aluminum products in the Misc. Fabricated Products industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– ESS DEE Aluminum has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Misc. Fabricated Products sector. This continuous investment in analytics has enabled ESS DEE Aluminum to build a competitive advantage using analytics. The analytics driven competitive advantage can help ESS DEE Aluminum to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Developing new processes and practices
– ESS DEE Aluminum can develop new processes and procedures in Misc. Fabricated Products 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.
Manufacturing automation
– ESS DEE Aluminum can use the latest technology developments to improve its manufacturing and designing process in Misc. Fabricated Products 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.
Loyalty marketing
– ESS DEE Aluminum 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for ESS DEE Aluminum 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. Fabricated Products industry, and it will provide faster access to the consumers.
Threats ESS DEE Aluminum External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of ESS DEE Aluminum are -
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 ESS DEE Aluminum business can come under increasing regulations regarding data privacy, data security, 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.
Increasing wage structure of ESS DEE Aluminum
– 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 ESS DEE Aluminum.
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 ESS DEE Aluminum.
Shortening product life cycle
– it is one of the major threat that ESS DEE Aluminum is facing in Misc. Fabricated Products sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Technology acceleration in Forth Industrial Revolution
– ESS DEE Aluminum has witnessed rapid integration of technology during Covid-19 in the Misc. Fabricated Products industry. As one of the leading players in the industry, ESS DEE Aluminum needs to keep up with the evolution of technology in the Misc. Fabricated Products 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.
Regulatory challenges
– ESS DEE Aluminum 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 Misc. Fabricated Products industry regulations.
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. ESS DEE Aluminum 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for ESS DEE Aluminum in Misc. Fabricated Products industry. The Misc. Fabricated Products 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.
Easy access to finance
– Easy access to finance in Misc. Fabricated Products industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. ESS DEE Aluminum can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
High dependence on third party suppliers
– ESS DEE Aluminum 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.
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. ESS DEE Aluminum needs to understand the core reasons impacting the Misc. Fabricated Products industry. This will help it in building a better workplace.
Environmental challenges
– ESS DEE Aluminum 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. ESS DEE Aluminum can take advantage of this fund but it will also bring new competitors in the Misc. Fabricated Products industry.
Weighted SWOT Analysis of ESS DEE Aluminum Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at ESS DEE Aluminum 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 ESS DEE Aluminum 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 ESS DEE Aluminum 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 ESS DEE Aluminum 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 ESS DEE Aluminum needs to make to build a sustainable competitive advantage.
