GI Dynamics (GID) SWOT Analysis / TOWS Matrix / MBA Resources
Medical Equipment & Supplies
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for GI Dynamics (Australia)
Based on various researches at Oak Spring University , GI Dynamics is operating in a macro-environment that has been destablized by – technology disruption, wage bills are increasing, supply chains are disrupted by pandemic , increasing household debt because of falling income levels, cloud computing is disrupting traditional business models, central banks are concerned over increasing inflation, talent flight as more people leaving formal jobs,
banking and financial system is disrupted by Bitcoin and other crypto currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that GI Dynamics can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the GI Dynamics, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which GI Dynamics 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 GI Dynamics can be done for the following purposes –
1. Strategic planning of GI Dynamics
2. Improving business portfolio management of GI Dynamics
3. Assessing feasibility of the new initiative in Australia
4. Making a Medical Equipment & Supplies sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of GI Dynamics
Strengths of GI Dynamics | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of GI Dynamics are -
Sustainable margins compare to other players in Medical Equipment & Supplies industry
– GI Dynamics has clearly differentiated products in the market place. This has enabled GI Dynamics to fetch slight price premium compare to the competitors in the Medical Equipment & Supplies industry. The sustainable margins have also helped GI Dynamics to invest into research and development (R&D) and innovation.
Superior customer experience
– The customer experience strategy of GI Dynamics in Medical Equipment & Supplies industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Low bargaining power of suppliers
– Suppliers of GI Dynamics in the Healthcare sector have low bargaining power. GI Dynamics has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps GI Dynamics to manage not only supply disruptions but also source products at highly competitive prices.
Effective Research and Development (R&D)
– GI Dynamics has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – GI Dynamics staying ahead in the Medical Equipment & Supplies industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Learning organization
- GI Dynamics 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 GI Dynamics is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at GI Dynamics emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– GI Dynamics is one of the leading players in the Medical Equipment & Supplies industry in Australia. It is in a position to attract the best talent available in Australia. The firm has a robust talent identification program that helps in identifying the brightest.
Diverse revenue streams
– GI Dynamics is present in almost all the verticals within the Medical Equipment & Supplies industry. This has provided GI Dynamics 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
– GI Dynamics is one of the most innovative firm in Medical Equipment & Supplies sector.
Cross disciplinary teams
– Horizontal connected teams at the GI Dynamics 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.
Highly skilled collaborators
– GI Dynamics has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Medical Equipment & Supplies industry. Secondly the value chain collaborators of GI Dynamics have helped the firm to develop new products and bring them quickly to the marketplace.
Analytics focus
– GI Dynamics 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 Medical Equipment & Supplies industry. The technology infrastructure of Australia 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.
Successful track record of launching new products
– GI Dynamics has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. GI Dynamics 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.
Weaknesses of GI Dynamics | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of GI Dynamics are -
Compensation and incentives
– The revenue per employee of GI Dynamics is just above the Medical Equipment & Supplies industry average. It needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Ability to respond to the competition
– As the decision making is very deliberative at GI Dynamics, in the dynamic environment of Medical Equipment & Supplies industry it has struggled to respond to the nimble upstart competition. GI Dynamics has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Increasing silos among functional specialists
– The organizational structure of GI Dynamics is dominated by functional specialists. It is not different from other players in the Medical Equipment & Supplies industry, but GI Dynamics needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help GI Dynamics to focus more on services in the Medical Equipment & Supplies industry rather than just following the product oriented approach.
High operating costs
– Compare to the competitors, GI Dynamics has high operating costs in the Medical Equipment & Supplies industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract GI Dynamics lucrative customers.
Lack of clear differentiation of GI Dynamics products
– To increase the profitability and margins on the products, GI Dynamics needs to provide more differentiated products than what it is currently offering in the marketplace.
High dependence on GI Dynamics ‘s star products
– The top 2 products and services of GI Dynamics still accounts for major business revenue. This dependence on star products in Medical Equipment & Supplies industry has resulted into insufficient focus on developing new products, even though GI Dynamics has relatively successful track record of launching new products.
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 GI Dynamics supply chain. Even after few cautionary changes, GI Dynamics is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left GI Dynamics vulnerable to further global disruptions in South East Asia.
Low market penetration in new markets
– Outside its home market of Australia, GI Dynamics needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
No frontier risks strategy
– From the 10K / annual statement of GI Dynamics, it seems that company is thinking out the frontier risks that can impact Medical Equipment & Supplies industry. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, GI Dynamics is slow explore the new channels of communication. These new channels of communication can help GI Dynamics to provide better information regarding Medical Equipment & Supplies products and services. It can also build an online community to further reach out to potential customers.
High bargaining power of channel partners in Medical Equipment & Supplies industry
– because of the regulatory requirements in Australia, GI Dynamics 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 Medical Equipment & Supplies industry.
GI Dynamics Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of GI Dynamics are -
Low interest rates
– Even though inflation is raising its head in most developed economies, GI Dynamics 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.
Building a culture of innovation
– managers at GI Dynamics 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 Medical Equipment & Supplies industry.
Leveraging digital technologies
– GI Dynamics 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.
Buying journey improvements
– GI Dynamics can improve the customer journey of consumers in the Medical Equipment & Supplies 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.
Manufacturing automation
– GI Dynamics can use the latest technology developments to improve its manufacturing and designing process in Medical Equipment & Supplies 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.
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 GI Dynamics 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Medical Equipment & Supplies industry, but it has also influenced the consumer preferences. GI Dynamics can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Developing new processes and practices
– GI Dynamics can develop new processes and procedures in Medical Equipment & Supplies 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for GI Dynamics 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 GI Dynamics to hire the very best people irrespective of their geographical location.
Using analytics as competitive advantage
– GI Dynamics has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Medical Equipment & Supplies sector. This continuous investment in analytics has enabled GI Dynamics to build a competitive advantage using analytics. The analytics driven competitive advantage can help GI Dynamics to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, GI Dynamics can use these opportunities to build new business models that can help the communities that GI Dynamics operates in. Secondly it can use opportunities from government spending in Medical Equipment & Supplies sector.
Better consumer reach
– The expansion of the 5G network will help GI Dynamics to increase its market reach. GI Dynamics 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.
Use of Bitcoin and other crypto currencies for transactions in Medical Equipment & Supplies industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for GI Dynamics in the Medical Equipment & Supplies industry. Now GI Dynamics can target international markets with far fewer capital restrictions requirements than the existing system.
Threats GI Dynamics External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of GI Dynamics are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, GI Dynamics 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 GI Dynamics prominent markets.
Increasing wage structure of GI Dynamics
– 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 GI Dynamics.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for GI Dynamics in Medical Equipment & Supplies industry. The Medical Equipment & Supplies 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.
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 GI Dynamics.
Technology acceleration in Forth Industrial Revolution
– GI Dynamics has witnessed rapid integration of technology during Covid-19 in the Medical Equipment & Supplies industry. As one of the leading players in the industry, GI Dynamics needs to keep up with the evolution of technology in the Medical Equipment & Supplies 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.
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.
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. GI Dynamics needs to understand the core reasons impacting the Medical Equipment & Supplies industry. This will help it in building a better workplace.
High dependence on third party suppliers
– GI Dynamics 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.
Consumer confidence and its impact on GI Dynamics 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 Medical Equipment & Supplies industry and other sectors.
Regulatory challenges
– GI Dynamics 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 Medical Equipment & Supplies industry regulations.
Stagnating economy with rate increase
– GI Dynamics 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 Medical Equipment & Supplies industry.
Easy access to finance
– Easy access to finance in Medical Equipment & Supplies industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. GI Dynamics can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of GI Dynamics Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at GI Dynamics 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 GI Dynamics 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 GI Dynamics 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 GI Dynamics 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 GI Dynamics needs to make to build a sustainable competitive advantage.