SWOT Analysis / TOWS Matrix for TCI Finance Ltd (India)
Based on various researches at Oak Spring University , TCI Finance Ltd is operating in a macro-environment that has been destablized by – increasing government debt because of Covid-19 spendings, geopolitical disruptions, there is backlash against globalization, digital marketing is dominated by two big players Facebook and Google, supply chains are disrupted by pandemic , cloud computing is disrupting traditional business models, there is increasing trade war between United States & China,
talent flight as more people leaving formal jobs, challanges to central banks by blockchain based private currencies, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that TCI Finance Ltd can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the TCI Finance Ltd, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which TCI Finance 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 TCI Finance Ltd can be done for the following purposes –
1. Strategic planning of TCI Finance Ltd
2. Improving business portfolio management of TCI Finance Ltd
3. Assessing feasibility of the new initiative in India
4. Making a Rental & Leasing sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of TCI Finance Ltd
Strengths of TCI Finance Ltd | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of TCI Finance Ltd are -
Diverse revenue streams
– TCI Finance Ltd is present in almost all the verticals within the Rental & Leasing industry. This has provided TCI Finance 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.
Innovation driven organization
– TCI Finance Ltd is one of the most innovative firm in Rental & Leasing sector.
Learning organization
- TCI Finance 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 TCI Finance Ltd is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at TCI Finance Ltd emphasize – knowledge, initiative, and innovation.
Analytics focus
– TCI Finance 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 Rental & Leasing 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.
Training and development
– TCI Finance Ltd has one of the best training and development program in Services industry. The effectiveness of the training programs can be measured in – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Organizational Resilience of TCI Finance Ltd
– The covid-19 pandemic has put organizational resilience at the centre of everthing TCI Finance Ltd does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Low bargaining power of suppliers
– Suppliers of TCI Finance Ltd in the Services sector have low bargaining power. TCI Finance Ltd has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps TCI Finance Ltd to manage not only supply disruptions but also source products at highly competitive prices.
Operational resilience
– The operational resilience strategy of TCI Finance Ltd comprises – understanding the underlying the factors in the Rental & Leasing industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Strong track record of project management in the Rental & Leasing industry
– TCI Finance Ltd is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Sustainable margins compare to other players in Rental & Leasing industry
– TCI Finance Ltd has clearly differentiated products in the market place. This has enabled TCI Finance Ltd to fetch slight price premium compare to the competitors in the Rental & Leasing industry. The sustainable margins have also helped TCI Finance Ltd to invest into research and development (R&D) and innovation.
High switching costs
– The high switching costs that TCI Finance Ltd 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.
Effective Research and Development (R&D)
– TCI Finance Ltd has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – TCI Finance Ltd staying ahead in the Rental & Leasing industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses of TCI Finance Ltd | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of TCI Finance Ltd are -
Need for greater diversity
– TCI Finance Ltd has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Slow to strategic competitive environment developments
– As TCI Finance Ltd is one of the leading players in the Rental & Leasing industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Rental & Leasing industry in last five years.
Compensation and incentives
– The revenue per employee of TCI Finance Ltd is just above the Rental & Leasing 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.
Low market penetration in new markets
– Outside its home market of India, TCI Finance Ltd needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
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 TCI Finance Ltd supply chain. Even after few cautionary changes, TCI Finance Ltd is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left TCI Finance Ltd vulnerable to further global disruptions in South East Asia.
Workers concerns about automation
– As automation is fast increasing in the Rental & Leasing industry, TCI Finance Ltd needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Increasing silos among functional specialists
– The organizational structure of TCI Finance Ltd is dominated by functional specialists. It is not different from other players in the Rental & Leasing industry, but TCI Finance Ltd needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help TCI Finance Ltd to focus more on services in the Rental & Leasing industry rather than just following the product oriented approach.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, TCI Finance Ltd is slow explore the new channels of communication. These new channels of communication can help TCI Finance Ltd to provide better information regarding Rental & Leasing products and services. It can also build an online community to further reach out to potential customers.
Lack of clear differentiation of TCI Finance Ltd products
– To increase the profitability and margins on the products, TCI Finance Ltd needs to provide more differentiated products than what it is currently offering in the marketplace.
Ability to respond to the competition
– As the decision making is very deliberative at TCI Finance Ltd, in the dynamic environment of Rental & Leasing industry it has struggled to respond to the nimble upstart competition. TCI Finance Ltd has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Products dominated business model
– Even though TCI Finance Ltd has some of the most successful models in the Rental & Leasing industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. TCI Finance Ltd should strive to include more intangible value offerings along with its core products and services.
TCI Finance Ltd Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of TCI Finance Ltd are -
Buying journey improvements
– TCI Finance Ltd can improve the customer journey of consumers in the Rental & Leasing 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Rental & Leasing industry, but it has also influenced the consumer preferences. TCI Finance Ltd 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. TCI Finance Ltd can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Developing new processes and practices
– TCI Finance Ltd can develop new processes and procedures in Rental & Leasing 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.
Using analytics as competitive advantage
– TCI Finance Ltd has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Rental & Leasing sector. This continuous investment in analytics has enabled TCI Finance Ltd to build a competitive advantage using analytics. The analytics driven competitive advantage can help TCI Finance Ltd to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Manufacturing automation
– TCI Finance Ltd can use the latest technology developments to improve its manufacturing and designing process in Rental & Leasing 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.
Building a culture of innovation
– managers at TCI Finance 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 Rental & Leasing industry.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Rental & Leasing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. TCI Finance 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. TCI Finance 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.
Learning at scale
– Online learning technologies has now opened space for TCI Finance Ltd to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Better consumer reach
– The expansion of the 5G network will help TCI Finance Ltd to increase its market reach. TCI Finance 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, TCI Finance 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 TCI Finance 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects TCI Finance Ltd can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Loyalty marketing
– TCI Finance Ltd has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Threats TCI Finance Ltd External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of TCI Finance Ltd are -
Environmental challenges
– TCI Finance Ltd 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. TCI Finance Ltd can take advantage of this fund but it will also bring new competitors in the Rental & Leasing industry.
Easy access to finance
– Easy access to finance in Rental & Leasing industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. TCI Finance Ltd can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Regulatory challenges
– TCI Finance 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 Rental & Leasing industry regulations.
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 TCI Finance Ltd in the Rental & Leasing sector and impact the bottomline of the organization.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, TCI Finance 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 Rental & Leasing sector.
Increasing wage structure of TCI Finance Ltd
– 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 TCI Finance Ltd.
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 TCI Finance Ltd business can come under increasing regulations regarding data privacy, data security, etc.
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 TCI Finance Ltd.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Rental & Leasing industry are lowering. It can presents TCI Finance Ltd with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Rental & Leasing sector.
Stagnating economy with rate increase
– TCI Finance 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 Rental & Leasing industry.
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.
Technology acceleration in Forth Industrial Revolution
– TCI Finance Ltd has witnessed rapid integration of technology during Covid-19 in the Rental & Leasing industry. As one of the leading players in the industry, TCI Finance Ltd needs to keep up with the evolution of technology in the Rental & Leasing 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.
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. TCI Finance Ltd will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Weighted SWOT Analysis of TCI Finance Ltd Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at TCI Finance 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 TCI Finance 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 TCI Finance 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 TCI Finance 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 TCI Finance Ltd needs to make to build a sustainable competitive advantage.