SWOT Analysis / TOWS Matrix for Somi Conveyor Beltings (India)
Based on various researches at Oak Spring University , Somi Conveyor Beltings is operating in a macro-environment that has been destablized by – banking and financial system is disrupted by Bitcoin and other crypto currencies, there is increasing trade war between United States & China, cloud computing is disrupting traditional business models, increasing energy prices, supply chains are disrupted by pandemic , 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%,
talent flight as more people leaving formal jobs, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of Somi Conveyor Beltings
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Somi Conveyor Beltings can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Somi Conveyor Beltings, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Somi Conveyor Beltings 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 Somi Conveyor Beltings can be done for the following purposes –
1. Strategic planning of Somi Conveyor Beltings
2. Improving business portfolio management of Somi Conveyor Beltings
3. Assessing feasibility of the new initiative in India
4. Making a Fabricated Plastic & Rubber sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Somi Conveyor Beltings
Strengths of Somi Conveyor Beltings | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Somi Conveyor Beltings are -
Digital Transformation in Fabricated Plastic & Rubber industry
- digital transformation varies from industry to industry. For Somi Conveyor Beltings digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Somi Conveyor Beltings 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)
– Somi Conveyor Beltings has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Somi Conveyor Beltings staying ahead in the Fabricated Plastic & Rubber industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to recruit top talent
– Somi Conveyor Beltings is one of the leading players in the Fabricated Plastic & Rubber 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.
Low bargaining power of suppliers
– Suppliers of Somi Conveyor Beltings in the Basic Materials sector have low bargaining power. Somi Conveyor Beltings has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Somi Conveyor Beltings to manage not only supply disruptions but also source products at highly competitive prices.
Cross disciplinary teams
– Horizontal connected teams at the Somi Conveyor Beltings 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.
Organizational Resilience of Somi Conveyor Beltings
– The covid-19 pandemic has put organizational resilience at the centre of everthing Somi Conveyor Beltings does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Operational resilience
– The operational resilience strategy of Somi Conveyor Beltings comprises – understanding the underlying the factors in the Fabricated Plastic & Rubber 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.
High brand equity
– Somi Conveyor Beltings has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Somi Conveyor Beltings to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Successful track record of launching new products
– Somi Conveyor Beltings has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Somi Conveyor Beltings 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.
Highly skilled collaborators
– Somi Conveyor Beltings has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Fabricated Plastic & Rubber industry. Secondly the value chain collaborators of Somi Conveyor Beltings have helped the firm to develop new products and bring them quickly to the marketplace.
Sustainable margins compare to other players in Fabricated Plastic & Rubber industry
– Somi Conveyor Beltings has clearly differentiated products in the market place. This has enabled Somi Conveyor Beltings to fetch slight price premium compare to the competitors in the Fabricated Plastic & Rubber industry. The sustainable margins have also helped Somi Conveyor Beltings to invest into research and development (R&D) and innovation.
Learning organization
- Somi Conveyor Beltings 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 Somi Conveyor Beltings is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Somi Conveyor Beltings emphasize – knowledge, initiative, and innovation.
Weaknesses of Somi Conveyor Beltings | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Somi Conveyor Beltings are -
Capital Spending Reduction
– Even during the low interest decade, Somi Conveyor Beltings has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the Fabricated Plastic & Rubber industry using digital technology.
Low market penetration in new markets
– Outside its home market of India, Somi Conveyor Beltings needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Somi Conveyor Beltings is slow explore the new channels of communication. These new channels of communication can help Somi Conveyor Beltings to provide better information regarding Fabricated Plastic & Rubber products and services. It can also build an online community to further reach out to potential customers.
Workers concerns about automation
– As automation is fast increasing in the Fabricated Plastic & Rubber industry, Somi Conveyor Beltings 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.
Slow decision making process
– As mentioned earlier in the report, Somi Conveyor Beltings has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Fabricated Plastic & Rubber industry over the last five years. Somi Conveyor Beltings even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
High operating costs
– Compare to the competitors, Somi Conveyor Beltings has high operating costs in the Fabricated Plastic & Rubber industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Somi Conveyor Beltings lucrative customers.
Aligning sales with marketing
– From the outside it seems that Somi Conveyor Beltings needs to have more collaboration between its sales team and marketing team. Sales professionals in the Fabricated Plastic & Rubber industry have deep experience in developing customer relationships. Marketing department at Somi Conveyor Beltings can leverage the sales team experience to cultivate customer relationships as Somi Conveyor Beltings is planning to shift buying processes online.
Interest costs
– Compare to the competition, Somi Conveyor Beltings 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.
Slow to strategic competitive environment developments
– As Somi Conveyor Beltings is one of the leading players in the Fabricated Plastic & Rubber industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Fabricated Plastic & Rubber industry in last five years.
High bargaining power of channel partners in Fabricated Plastic & Rubber industry
– because of the regulatory requirements in India, Somi Conveyor Beltings 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 Fabricated Plastic & Rubber industry.
Compensation and incentives
– The revenue per employee of Somi Conveyor Beltings is just above the Fabricated Plastic & Rubber 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.
Somi Conveyor Beltings Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Somi Conveyor Beltings are -
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Somi Conveyor Beltings can use these opportunities to build new business models that can help the communities that Somi Conveyor Beltings operates in. Secondly it can use opportunities from government spending in Fabricated Plastic & Rubber sector.
Creating value in data economy
– The success of analytics program of Somi Conveyor Beltings has opened avenues for new revenue streams for the organization in Fabricated Plastic & Rubber industry. This can help Somi Conveyor Beltings to build a more holistic ecosystem for Somi Conveyor Beltings products in the Fabricated Plastic & Rubber industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Fabricated Plastic & Rubber industry, but it has also influenced the consumer preferences. Somi Conveyor Beltings can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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. Somi Conveyor Beltings can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Somi Conveyor Beltings 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 Somi Conveyor Beltings to hire the very best people irrespective of their geographical location.
Manufacturing automation
– Somi Conveyor Beltings can use the latest technology developments to improve its manufacturing and designing process in Fabricated Plastic & Rubber 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Somi Conveyor Beltings 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 Somi Conveyor Beltings to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Leveraging digital technologies
– Somi Conveyor Beltings can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Developing new processes and practices
– Somi Conveyor Beltings can develop new processes and procedures in Fabricated Plastic & Rubber 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.
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 Somi Conveyor Beltings 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
– Somi Conveyor Beltings can improve the customer journey of consumers in the Fabricated Plastic & Rubber 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
– Somi Conveyor Beltings 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Somi Conveyor Beltings 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.
Threats Somi Conveyor Beltings External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Somi Conveyor Beltings 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Somi Conveyor Beltings 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 Somi Conveyor Beltings 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.
Stagnating economy with rate increase
– Somi Conveyor Beltings 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 Fabricated Plastic & Rubber industry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Somi Conveyor Beltings may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Fabricated Plastic & Rubber sector.
Environmental challenges
– Somi Conveyor Beltings 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. Somi Conveyor Beltings can take advantage of this fund but it will also bring new competitors in the Fabricated Plastic & Rubber industry.
High dependence on third party suppliers
– Somi Conveyor Beltings 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.
Shortening product life cycle
– it is one of the major threat that Somi Conveyor Beltings is facing in Fabricated Plastic & Rubber sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Regulatory challenges
– Somi Conveyor Beltings 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 Fabricated Plastic & Rubber industry regulations.
Consumer confidence and its impact on Somi Conveyor Beltings 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 Fabricated Plastic & Rubber industry and other sectors.
Easy access to finance
– Easy access to finance in Fabricated Plastic & Rubber industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Somi Conveyor Beltings 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. Somi Conveyor Beltings needs to understand the core reasons impacting the Fabricated Plastic & Rubber industry. This will help it in building a better workplace.
Technology acceleration in Forth Industrial Revolution
– Somi Conveyor Beltings has witnessed rapid integration of technology during Covid-19 in the Fabricated Plastic & Rubber industry. As one of the leading players in the industry, Somi Conveyor Beltings needs to keep up with the evolution of technology in the Fabricated Plastic & Rubber 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.
Weighted SWOT Analysis of Somi Conveyor Beltings Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Somi Conveyor Beltings 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 Somi Conveyor Beltings 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 Somi Conveyor Beltings 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 Somi Conveyor Beltings 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 Somi Conveyor Beltings needs to make to build a sustainable competitive advantage.