Paras Petrofils Ltd (PARP) SWOT Analysis / TOWS Matrix / MBA Resources
Textiles - Non Apparel
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Paras Petrofils Ltd (India)
Based on various researches at Oak Spring University , Paras Petrofils Ltd is operating in a macro-environment that has been destablized by – increasing transportation and logistics costs, increasing government debt because of Covid-19 spendings, central banks are concerned over increasing inflation, geopolitical disruptions, technology disruption, competitive advantages are harder to sustain because of technology dispersion, banking and financial system is disrupted by Bitcoin and other crypto currencies,
talent flight as more people leaving formal jobs, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Paras Petrofils Ltd
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Paras Petrofils Ltd can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Paras Petrofils Ltd, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Paras Petrofils 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 Paras Petrofils Ltd can be done for the following purposes –
1. Strategic planning of Paras Petrofils Ltd
2. Improving business portfolio management of Paras Petrofils Ltd
3. Assessing feasibility of the new initiative in India
4. Making a Textiles - Non Apparel sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Paras Petrofils Ltd
Strengths of Paras Petrofils Ltd | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Paras Petrofils Ltd are -
Diverse revenue streams
– Paras Petrofils Ltd is present in almost all the verticals within the Textiles - Non Apparel industry. This has provided Paras Petrofils 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
– Paras Petrofils Ltd is one of the most innovative firm in Textiles - Non Apparel sector.
High brand equity
– Paras Petrofils Ltd has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Paras Petrofils Ltd to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of Paras Petrofils Ltd in the Consumer Cyclical sector have low bargaining power. Paras Petrofils Ltd has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Paras Petrofils Ltd to manage not only supply disruptions but also source products at highly competitive prices.
Highly skilled collaborators
– Paras Petrofils Ltd has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Textiles - Non Apparel industry. Secondly the value chain collaborators of Paras Petrofils Ltd have helped the firm to develop new products and bring them quickly to the marketplace.
Cross disciplinary teams
– Horizontal connected teams at the Paras Petrofils Ltd 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.
Analytics focus
– Paras Petrofils 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 Textiles - Non Apparel 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.
Digital Transformation in Textiles - Non Apparel industry
- digital transformation varies from industry to industry. For Paras Petrofils Ltd digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Paras Petrofils Ltd 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)
– Paras Petrofils Ltd has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Paras Petrofils Ltd staying ahead in the Textiles - Non Apparel 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 Paras Petrofils Ltd in Textiles - Non Apparel industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Organizational Resilience of Paras Petrofils Ltd
– The covid-19 pandemic has put organizational resilience at the centre of everthing Paras Petrofils Ltd does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High switching costs
– The high switching costs that Paras Petrofils 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.
Weaknesses of Paras Petrofils Ltd | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Paras Petrofils Ltd are -
High operating costs
– Compare to the competitors, Paras Petrofils Ltd has high operating costs in the Textiles - Non Apparel industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Paras Petrofils Ltd lucrative customers.
High dependence on Paras Petrofils Ltd ‘s star products
– The top 2 products and services of Paras Petrofils Ltd still accounts for major business revenue. This dependence on star products in Textiles - Non Apparel industry has resulted into insufficient focus on developing new products, even though Paras Petrofils Ltd has relatively successful track record of launching new products.
Slow decision making process
– As mentioned earlier in the report, Paras Petrofils Ltd has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Textiles - Non Apparel industry over the last five years. Paras Petrofils Ltd 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.
Ability to respond to the competition
– As the decision making is very deliberative at Paras Petrofils Ltd, in the dynamic environment of Textiles - Non Apparel industry it has struggled to respond to the nimble upstart competition. Paras Petrofils Ltd has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Interest costs
– Compare to the competition, Paras Petrofils Ltd 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.
Low market penetration in new markets
– Outside its home market of India, Paras Petrofils Ltd 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, Paras Petrofils Ltd is slow explore the new channels of communication. These new channels of communication can help Paras Petrofils Ltd to provide better information regarding Textiles - Non Apparel products and services. It can also build an online community to further reach out to potential customers.
Lack of clear differentiation of Paras Petrofils Ltd products
– To increase the profitability and margins on the products, Paras Petrofils Ltd needs to provide more differentiated products than what it is currently offering in the marketplace.
Compensation and incentives
– The revenue per employee of Paras Petrofils Ltd is just above the Textiles - Non Apparel 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.
Products dominated business model
– Even though Paras Petrofils Ltd has some of the most successful models in the Textiles - Non Apparel industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Paras Petrofils Ltd should strive to include more intangible value offerings along with its core products and services.
Increasing silos among functional specialists
– The organizational structure of Paras Petrofils Ltd is dominated by functional specialists. It is not different from other players in the Textiles - Non Apparel industry, but Paras Petrofils Ltd needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Paras Petrofils Ltd to focus more on services in the Textiles - Non Apparel industry rather than just following the product oriented approach.
Paras Petrofils Ltd Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Paras Petrofils Ltd are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Paras Petrofils Ltd is facing challenges because of the dominance of functional experts in the organization. Paras Petrofils Ltd can utilize new technology in the field of Textiles - Non Apparel industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Using analytics as competitive advantage
– Paras Petrofils Ltd has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Textiles - Non Apparel sector. This continuous investment in analytics has enabled Paras Petrofils Ltd to build a competitive advantage using analytics. The analytics driven competitive advantage can help Paras Petrofils Ltd to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Better consumer reach
– The expansion of the 5G network will help Paras Petrofils Ltd to increase its market reach. Paras Petrofils 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, Paras Petrofils 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 Paras Petrofils 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.
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. Paras Petrofils Ltd can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Paras Petrofils Ltd can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Manufacturing automation
– Paras Petrofils Ltd can use the latest technology developments to improve its manufacturing and designing process in Textiles - Non Apparel 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.
Learning at scale
– Online learning technologies has now opened space for Paras Petrofils 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.
Creating value in data economy
– The success of analytics program of Paras Petrofils Ltd has opened avenues for new revenue streams for the organization in Textiles - Non Apparel industry. This can help Paras Petrofils Ltd to build a more holistic ecosystem for Paras Petrofils Ltd products in the Textiles - Non Apparel industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Paras Petrofils Ltd in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Textiles - Non Apparel industry, and it will provide faster access to the consumers.
Low interest rates
– Even though inflation is raising its head in most developed economies, Paras Petrofils Ltd 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.
Use of Bitcoin and other crypto currencies for transactions in Textiles - Non Apparel industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Paras Petrofils Ltd in the Textiles - Non Apparel industry. Now Paras Petrofils Ltd can target international markets with far fewer capital restrictions requirements than the existing system.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Textiles - Non Apparel industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Paras Petrofils 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. Paras Petrofils 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.
Threats Paras Petrofils Ltd External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Paras Petrofils Ltd are -
Shortening product life cycle
– it is one of the major threat that Paras Petrofils Ltd is facing in Textiles - Non Apparel sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Paras Petrofils Ltd in the Textiles - Non Apparel sector and impact the bottomline of the organization.
Increasing wage structure of Paras Petrofils 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 Paras Petrofils Ltd.
Environmental challenges
– Paras Petrofils 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. Paras Petrofils Ltd can take advantage of this fund but it will also bring new competitors in the Textiles - Non Apparel industry.
Consumer confidence and its impact on Paras Petrofils Ltd 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 Textiles - Non Apparel industry and other sectors.
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. Paras Petrofils 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.
Technology acceleration in Forth Industrial Revolution
– Paras Petrofils Ltd has witnessed rapid integration of technology during Covid-19 in the Textiles - Non Apparel industry. As one of the leading players in the industry, Paras Petrofils Ltd needs to keep up with the evolution of technology in the Textiles - Non Apparel 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.
High dependence on third party suppliers
– Paras Petrofils Ltd 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.
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 Paras Petrofils Ltd.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Textiles - Non Apparel industry are lowering. It can presents Paras Petrofils Ltd with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Textiles - Non Apparel sector.
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 Paras Petrofils Ltd business can come under increasing regulations regarding data privacy, data security, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Paras Petrofils 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 Textiles - Non Apparel sector.
Weighted SWOT Analysis of Paras Petrofils Ltd Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Paras Petrofils 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 Paras Petrofils 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 Paras Petrofils 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 Paras Petrofils 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 Paras Petrofils Ltd needs to make to build a sustainable competitive advantage.