K&O Energy Group Inc (1663) SWOT Analysis / TOWS Matrix / MBA Resources
Oil & Gas Operations
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for K&O Energy Group Inc (Japan)
Based on various researches at Oak Spring University , K&O Energy Group Inc is operating in a macro-environment that has been destablized by – challanges to central banks by blockchain based private currencies, competitive advantages are harder to sustain because of technology dispersion, there is increasing trade war between United States & China, increasing household debt because of falling income levels, geopolitical disruptions, digital marketing is dominated by two big players Facebook and Google, customer relationship management is fast transforming because of increasing concerns over data privacy,
cloud computing is disrupting traditional business models, increasing energy prices, etc
Introduction to SWOT Analysis of K&O Energy Group Inc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that K&O Energy Group Inc can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the K&O Energy Group Inc, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which K&O Energy Group Inc 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 K&O Energy Group Inc can be done for the following purposes –
1. Strategic planning of K&O Energy Group Inc
2. Improving business portfolio management of K&O Energy Group Inc
3. Assessing feasibility of the new initiative in Japan
4. Making a Oil & Gas Operations sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of K&O Energy Group Inc
Strengths of K&O Energy Group Inc | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of K&O Energy Group Inc are -
Learning organization
- K&O Energy Group Inc 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 K&O Energy Group Inc is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at K&O Energy Group Inc emphasize – knowledge, initiative, and innovation.
Analytics focus
– K&O Energy Group Inc 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 Oil & Gas Operations industry. The technology infrastructure of Japan 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.
High brand equity
– K&O Energy Group Inc has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled K&O Energy Group Inc to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Strong track record of project management in the Oil & Gas Operations industry
– K&O Energy Group Inc is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High switching costs
– The high switching costs that K&O Energy Group Inc 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.
Training and development
– K&O Energy Group Inc has one of the best training and development program in Energy 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.
Ability to recruit top talent
– K&O Energy Group Inc is one of the leading players in the Oil & Gas Operations industry in Japan. It is in a position to attract the best talent available in Japan. The firm has a robust talent identification program that helps in identifying the brightest.
Sustainable margins compare to other players in Oil & Gas Operations industry
– K&O Energy Group Inc has clearly differentiated products in the market place. This has enabled K&O Energy Group Inc to fetch slight price premium compare to the competitors in the Oil & Gas Operations industry. The sustainable margins have also helped K&O Energy Group Inc to invest into research and development (R&D) and innovation.
Innovation driven organization
– K&O Energy Group Inc is one of the most innovative firm in Oil & Gas Operations sector.
Operational resilience
– The operational resilience strategy of K&O Energy Group Inc comprises – understanding the underlying the factors in the Oil & Gas Operations 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.
Successful track record of launching new products
– K&O Energy Group Inc has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. K&O Energy Group Inc 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.
Effective Research and Development (R&D)
– K&O Energy Group Inc has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – K&O Energy Group Inc staying ahead in the Oil & Gas Operations industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses of K&O Energy Group Inc | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of K&O Energy Group Inc are -
Low market penetration in new markets
– Outside its home market of Japan, K&O Energy Group Inc needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Capital Spending Reduction
– Even during the low interest decade, K&O Energy Group Inc 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 Oil & Gas Operations industry using digital technology.
High bargaining power of channel partners in Oil & Gas Operations industry
– because of the regulatory requirements in Japan, K&O Energy Group Inc 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 Oil & Gas Operations industry.
Products dominated business model
– Even though K&O Energy Group Inc has some of the most successful models in the Oil & Gas Operations industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. K&O Energy Group Inc should strive to include more intangible value offerings along with its core products and services.
Lack of clear differentiation of K&O Energy Group Inc products
– To increase the profitability and margins on the products, K&O Energy Group Inc needs to provide more differentiated products than what it is currently offering in the marketplace.
Increasing silos among functional specialists
– The organizational structure of K&O Energy Group Inc is dominated by functional specialists. It is not different from other players in the Oil & Gas Operations industry, but K&O Energy Group Inc needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help K&O Energy Group Inc to focus more on services in the Oil & Gas Operations industry rather than just following the product oriented approach.
No frontier risks strategy
– From the 10K / annual statement of K&O Energy Group Inc, it seems that company is thinking out the frontier risks that can impact Oil & Gas Operations 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.
Workers concerns about automation
– As automation is fast increasing in the Oil & Gas Operations industry, K&O Energy Group Inc 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.
Interest costs
– Compare to the competition, K&O Energy Group Inc 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.
Skills based hiring in Oil & Gas Operations industry
– The stress on hiring functional specialists at K&O Energy Group Inc has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
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 K&O Energy Group Inc supply chain. Even after few cautionary changes, K&O Energy Group Inc is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left K&O Energy Group Inc vulnerable to further global disruptions in South East Asia.
K&O Energy Group Inc Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of K&O Energy Group Inc are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for K&O Energy Group Inc in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Oil & Gas Operations industry, and it will provide faster access to the consumers.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Oil & Gas Operations industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. K&O Energy Group Inc 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. K&O Energy Group Inc 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, K&O Energy Group Inc can use these opportunities to build new business models that can help the communities that K&O Energy Group Inc operates in. Secondly it can use opportunities from government spending in Oil & Gas Operations sector.
Leveraging digital technologies
– K&O Energy Group Inc 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects K&O Energy Group Inc can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Building a culture of innovation
– managers at K&O Energy Group Inc 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 Oil & Gas Operations industry.
Low interest rates
– Even though inflation is raising its head in most developed economies, K&O Energy Group Inc 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.
Better consumer reach
– The expansion of the 5G network will help K&O Energy Group Inc to increase its market reach. K&O Energy Group Inc 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, K&O Energy Group Inc is facing challenges because of the dominance of functional experts in the organization. K&O Energy Group Inc can utilize new technology in the field of Oil & Gas Operations industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Creating value in data economy
– The success of analytics program of K&O Energy Group Inc has opened avenues for new revenue streams for the organization in Oil & Gas Operations industry. This can help K&O Energy Group Inc to build a more holistic ecosystem for K&O Energy Group Inc products in the Oil & Gas Operations industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Manufacturing automation
– K&O Energy Group Inc can use the latest technology developments to improve its manufacturing and designing process in Oil & Gas Operations 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.
Buying journey improvements
– K&O Energy Group Inc can improve the customer journey of consumers in the Oil & Gas Operations 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.
Use of Bitcoin and other crypto currencies for transactions in Oil & Gas Operations industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for K&O Energy Group Inc in the Oil & Gas Operations industry. Now K&O Energy Group Inc can target international markets with far fewer capital restrictions requirements than the existing system.
Threats K&O Energy Group Inc External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of K&O Energy Group Inc are -
Technology acceleration in Forth Industrial Revolution
– K&O Energy Group Inc has witnessed rapid integration of technology during Covid-19 in the Oil & Gas Operations industry. As one of the leading players in the industry, K&O Energy Group Inc needs to keep up with the evolution of technology in the Oil & Gas Operations 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.
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 K&O Energy Group Inc 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, K&O Energy Group Inc may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Oil & Gas Operations sector.
Consumer confidence and its impact on K&O Energy Group Inc 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 Oil & Gas Operations industry and other sectors.
High dependence on third party suppliers
– K&O Energy Group Inc 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Oil & Gas Operations industry are lowering. It can presents K&O Energy Group Inc with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Oil & Gas Operations sector.
Easy access to finance
– Easy access to finance in Oil & Gas Operations industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. K&O Energy Group Inc can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing wage structure of K&O Energy Group Inc
– 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 K&O Energy Group Inc.
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. K&O Energy Group Inc 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.
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. K&O Energy Group Inc needs to understand the core reasons impacting the Oil & Gas Operations industry. This will help it in building a better workplace.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for K&O Energy Group Inc in Oil & Gas Operations industry. The Oil & Gas Operations 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.
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.
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 K&O Energy Group Inc in the Oil & Gas Operations sector and impact the bottomline of the organization.
Weighted SWOT Analysis of K&O Energy Group Inc Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at K&O Energy Group Inc 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 K&O Energy Group Inc 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 K&O Energy Group Inc 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 K&O Energy Group Inc 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 K&O Energy Group Inc needs to make to build a sustainable competitive advantage.