Lakshmi Finance and Industrial (LFIC) SWOT Analysis / TOWS Matrix / MBA Resources
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Lakshmi Finance and Industrial (India)
Based on various researches at Oak Spring University , Lakshmi Finance and Industrial is operating in a macro-environment that has been destablized by – increasing energy prices, there is increasing trade war between United States & China, increasing government debt because of Covid-19 spendings, supply chains are disrupted by pandemic , competitive advantages are harder to sustain because of technology dispersion, there is backlash against globalization, challanges to central banks by blockchain based private currencies,
geopolitical disruptions, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of Lakshmi Finance and Industrial
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Lakshmi Finance and Industrial can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Lakshmi Finance and Industrial, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Lakshmi Finance and Industrial 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 Lakshmi Finance and Industrial can be done for the following purposes –
1. Strategic planning of Lakshmi Finance and Industrial
2. Improving business portfolio management of Lakshmi Finance and Industrial
3. Assessing feasibility of the new initiative in India
4. Making a sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Lakshmi Finance and Industrial
Strengths of Lakshmi Finance and Industrial | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Lakshmi Finance and Industrial are -
Effective Research and Development (R&D)
– Lakshmi Finance and Industrial has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Lakshmi Finance and Industrial staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Highly skilled collaborators
– Lakshmi Finance and Industrial has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive industry. Secondly the value chain collaborators of Lakshmi Finance and Industrial have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to lead change in
– Lakshmi Finance and Industrial is one of the leading players in the industry in India. Over the years it has not only transformed the business landscape in the industry in India but also across the existing markets. The ability to lead change has enabled Lakshmi Finance and Industrial in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Organizational Resilience of Lakshmi Finance and Industrial
– The covid-19 pandemic has put organizational resilience at the centre of everthing Lakshmi Finance and Industrial does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Strong track record of project management in the industry
– Lakshmi Finance and Industrial is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Learning organization
- Lakshmi Finance and Industrial 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 Lakshmi Finance and Industrial is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Lakshmi Finance and Industrial emphasize – knowledge, initiative, and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Lakshmi Finance and Industrial 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.
High switching costs
– The high switching costs that Lakshmi Finance and Industrial 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.
Superior customer experience
– The customer experience strategy of Lakshmi Finance and Industrial in industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Analytics focus
– Lakshmi Finance and Industrial 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 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.
Ability to recruit top talent
– Lakshmi Finance and Industrial is one of the leading players in the 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.
Digital Transformation in industry
- digital transformation varies from industry to industry. For Lakshmi Finance and Industrial digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Lakshmi Finance and Industrial 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.
Weaknesses of Lakshmi Finance and Industrial | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Lakshmi Finance and Industrial are -
High bargaining power of channel partners in industry
– because of the regulatory requirements in India, Lakshmi Finance and Industrial 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 industry.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Lakshmi Finance and Industrial is slow explore the new channels of communication. These new channels of communication can help Lakshmi Finance and Industrial to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
High cash cycle compare to competitors
Lakshmi Finance and Industrial has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Interest costs
– Compare to the competition, Lakshmi Finance and Industrial has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
High operating costs
– Compare to the competitors, Lakshmi Finance and Industrial has high operating costs in the industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Lakshmi Finance and Industrial lucrative customers.
Lack of clear differentiation of Lakshmi Finance and Industrial products
– To increase the profitability and margins on the products, Lakshmi Finance and Industrial needs to provide more differentiated products than what it is currently offering in the marketplace.
Products dominated business model
– Even though Lakshmi Finance and Industrial has some of the most successful models in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Lakshmi Finance and Industrial should strive to include more intangible value offerings along with its core products and services.
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 Lakshmi Finance and Industrial supply chain. Even after few cautionary changes, Lakshmi Finance and Industrial is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Lakshmi Finance and Industrial vulnerable to further global disruptions in South East Asia.
Increasing silos among functional specialists
– The organizational structure of Lakshmi Finance and Industrial is dominated by functional specialists. It is not different from other players in the industry, but Lakshmi Finance and Industrial needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Lakshmi Finance and Industrial to focus more on services in the industry rather than just following the product oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Lakshmi Finance and Industrial 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 industry using digital technology.
Aligning sales with marketing
– From the outside it seems that Lakshmi Finance and Industrial needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department at Lakshmi Finance and Industrial can leverage the sales team experience to cultivate customer relationships as Lakshmi Finance and Industrial is planning to shift buying processes online.
Lakshmi Finance and Industrial Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Lakshmi Finance and Industrial are -
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in industry, but it has also influenced the consumer preferences. Lakshmi Finance and Industrial can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Use of Bitcoin and other crypto currencies for transactions in industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Lakshmi Finance and Industrial in the industry. Now Lakshmi Finance and Industrial can target international markets with far fewer capital restrictions requirements than the existing system.
Better consumer reach
– The expansion of the 5G network will help Lakshmi Finance and Industrial to increase its market reach. Lakshmi Finance and Industrial 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, Lakshmi Finance and Industrial 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 Lakshmi Finance and Industrial to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Lakshmi Finance and Industrial 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. Lakshmi Finance and Industrial 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Lakshmi Finance and Industrial is facing challenges because of the dominance of functional experts in the organization. Lakshmi Finance and Industrial can utilize new technology in the field of industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Leveraging digital technologies
– Lakshmi Finance and Industrial 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.
Learning at scale
– Online learning technologies has now opened space for Lakshmi Finance and Industrial 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.
Building a culture of innovation
– managers at Lakshmi Finance and Industrial 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 industry.
Developing new processes and practices
– Lakshmi Finance and Industrial can develop new processes and procedures in 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.
Creating value in data economy
– The success of analytics program of Lakshmi Finance and Industrial has opened avenues for new revenue streams for the organization in industry. This can help Lakshmi Finance and Industrial to build a more holistic ecosystem for Lakshmi Finance and Industrial products in the industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– Lakshmi Finance and Industrial has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in sector. This continuous investment in analytics has enabled Lakshmi Finance and Industrial to build a competitive advantage using analytics. The analytics driven competitive advantage can help Lakshmi Finance and Industrial 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, Lakshmi Finance and Industrial can use these opportunities to build new business models that can help the communities that Lakshmi Finance and Industrial operates in. Secondly it can use opportunities from government spending in sector.
Threats Lakshmi Finance and Industrial External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Lakshmi Finance and Industrial are -
Increasing wage structure of Lakshmi Finance and Industrial
– 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 Lakshmi Finance and Industrial.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Lakshmi Finance and Industrial 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 Lakshmi Finance and Industrial prominent markets.
Shortening product life cycle
– it is one of the major threat that Lakshmi Finance and Industrial is facing in sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
High dependence on third party suppliers
– Lakshmi Finance and Industrial 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.
Regulatory challenges
– Lakshmi Finance and Industrial 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 industry regulations.
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.
Easy access to finance
– Easy access to finance in industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Lakshmi Finance and Industrial can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Lakshmi Finance and Industrial needs to understand the core reasons impacting the industry. This will help it in building a better workplace.
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 Lakshmi Finance and Industrial business can come under increasing regulations regarding data privacy, data security, etc.
Environmental challenges
– Lakshmi Finance and Industrial 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. Lakshmi Finance and Industrial can take advantage of this fund but it will also bring new competitors in the industry.
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 Lakshmi Finance and Industrial in the 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, Lakshmi Finance and Industrial may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of sector.
Weighted SWOT Analysis of Lakshmi Finance and Industrial Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Lakshmi Finance and Industrial 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 Lakshmi Finance and Industrial 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 Lakshmi Finance and Industrial 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 Lakshmi Finance and Industrial 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 Lakshmi Finance and Industrial needs to make to build a sustainable competitive advantage.