AFC-HD AMS Life Science (2927) SWOT Analysis / TOWS Matrix / MBA Resources
Food Processing
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for AFC-HD AMS Life Science (Japan)
Based on various researches at Oak Spring University , AFC-HD AMS Life Science is operating in a macro-environment that has been destablized by – increasing household debt because of falling income levels, technology disruption, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing transportation and logistics costs, increasing inequality as vast percentage of new income is going to the top 1%, supply chains are disrupted by pandemic , there is increasing trade war between United States & China,
central banks are concerned over increasing inflation, wage bills are increasing, etc
Introduction to SWOT Analysis of AFC-HD AMS Life Science
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that AFC-HD AMS Life Science can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the AFC-HD AMS Life Science, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which AFC-HD AMS Life Science 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 AFC-HD AMS Life Science can be done for the following purposes –
1. Strategic planning of AFC-HD AMS Life Science
2. Improving business portfolio management of AFC-HD AMS Life Science
3. Assessing feasibility of the new initiative in Japan
4. Making a Food Processing sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of AFC-HD AMS Life Science
Strengths of AFC-HD AMS Life Science | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of AFC-HD AMS Life Science are -
Sustainable margins compare to other players in Food Processing industry
– AFC-HD AMS Life Science has clearly differentiated products in the market place. This has enabled AFC-HD AMS Life Science to fetch slight price premium compare to the competitors in the Food Processing industry. The sustainable margins have also helped AFC-HD AMS Life Science to invest into research and development (R&D) and innovation.
Digital Transformation in Food Processing industry
- digital transformation varies from industry to industry. For AFC-HD AMS Life Science digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. AFC-HD AMS Life Science 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.
Training and development
– AFC-HD AMS Life Science has one of the best training and development program in Consumer/Non-Cyclical 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.
High switching costs
– The high switching costs that AFC-HD AMS Life Science 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.
Cross disciplinary teams
– Horizontal connected teams at the AFC-HD AMS Life Science 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.
Ability to recruit top talent
– AFC-HD AMS Life Science is one of the leading players in the Food Processing 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.
Learning organization
- AFC-HD AMS Life Science 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 AFC-HD AMS Life Science is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at AFC-HD AMS Life Science emphasize – knowledge, initiative, and innovation.
Operational resilience
– The operational resilience strategy of AFC-HD AMS Life Science comprises – understanding the underlying the factors in the Food Processing 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.
Ability to lead change in Food Processing
– AFC-HD AMS Life Science is one of the leading players in the Food Processing industry in Japan. Over the years it has not only transformed the business landscape in the Food Processing industry in Japan but also across the existing markets. The ability to lead change has enabled AFC-HD AMS Life Science in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Successful track record of launching new products
– AFC-HD AMS Life Science has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. AFC-HD AMS Life Science 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.
High brand equity
– AFC-HD AMS Life Science has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled AFC-HD AMS Life Science to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– AFC-HD AMS Life Science is present in almost all the verticals within the Food Processing industry. This has provided AFC-HD AMS Life Science 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.
Weaknesses of AFC-HD AMS Life Science | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of AFC-HD AMS Life Science are -
High cash cycle compare to competitors
AFC-HD AMS Life Science has a high cash cycle compare to other players in the Food Processing industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Need for greater diversity
– AFC-HD AMS Life Science 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.
Capital Spending Reduction
– Even during the low interest decade, AFC-HD AMS Life Science 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 Food Processing industry using digital technology.
High dependence on AFC-HD AMS Life Science ‘s star products
– The top 2 products and services of AFC-HD AMS Life Science still accounts for major business revenue. This dependence on star products in Food Processing industry has resulted into insufficient focus on developing new products, even though AFC-HD AMS Life Science has relatively successful track record of launching new products.
Lack of clear differentiation of AFC-HD AMS Life Science products
– To increase the profitability and margins on the products, AFC-HD AMS Life Science 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 AFC-HD AMS Life Science, in the dynamic environment of Food Processing industry it has struggled to respond to the nimble upstart competition. AFC-HD AMS Life Science 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, AFC-HD AMS Life Science 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 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 AFC-HD AMS Life Science supply chain. Even after few cautionary changes, AFC-HD AMS Life Science is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left AFC-HD AMS Life Science vulnerable to further global disruptions in South East Asia.
Slow decision making process
– As mentioned earlier in the report, AFC-HD AMS Life Science has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Food Processing industry over the last five years. AFC-HD AMS Life Science 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, AFC-HD AMS Life Science is slow explore the new channels of communication. These new channels of communication can help AFC-HD AMS Life Science to provide better information regarding Food Processing products and services. It can also build an online community to further reach out to potential customers.
High operating costs
– Compare to the competitors, AFC-HD AMS Life Science has high operating costs in the Food Processing industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract AFC-HD AMS Life Science lucrative customers.
AFC-HD AMS Life Science Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of AFC-HD AMS Life Science are -
Leveraging digital technologies
– AFC-HD AMS Life Science 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, AFC-HD AMS Life Science is facing challenges because of the dominance of functional experts in the organization. AFC-HD AMS Life Science can utilize new technology in the field of Food Processing industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Buying journey improvements
– AFC-HD AMS Life Science can improve the customer journey of consumers in the Food Processing 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.
Learning at scale
– Online learning technologies has now opened space for AFC-HD AMS Life Science 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.
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 AFC-HD AMS Life Science 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, AFC-HD AMS Life Science can use these opportunities to build new business models that can help the communities that AFC-HD AMS Life Science operates in. Secondly it can use opportunities from government spending in Food Processing sector.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Food Processing industry, but it has also influenced the consumer preferences. AFC-HD AMS Life Science can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for AFC-HD AMS Life Science 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 AFC-HD AMS Life Science to hire the very best people irrespective of their geographical location.
Lowering marketing communication costs
– 5G expansion will open new opportunities for AFC-HD AMS Life Science in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Food Processing industry, and it will provide faster access to the consumers.
Developing new processes and practices
– AFC-HD AMS Life Science can develop new processes and procedures in Food Processing 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.
Building a culture of innovation
– managers at AFC-HD AMS Life Science 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 Food Processing industry.
Loyalty marketing
– AFC-HD AMS Life Science 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.
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. AFC-HD AMS Life Science can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats AFC-HD AMS Life Science External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of AFC-HD AMS Life Science are -
Consumer confidence and its impact on AFC-HD AMS Life Science 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 Food Processing industry and other sectors.
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 AFC-HD AMS Life Science.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, AFC-HD AMS Life Science 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 AFC-HD AMS Life Science prominent markets.
Environmental challenges
– AFC-HD AMS Life Science 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. AFC-HD AMS Life Science can take advantage of this fund but it will also bring new competitors in the Food Processing 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.
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. AFC-HD AMS Life Science 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.
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 AFC-HD AMS Life Science business can come under increasing regulations regarding data privacy, data security, etc.
Technology acceleration in Forth Industrial Revolution
– AFC-HD AMS Life Science has witnessed rapid integration of technology during Covid-19 in the Food Processing industry. As one of the leading players in the industry, AFC-HD AMS Life Science needs to keep up with the evolution of technology in the Food Processing 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.
Stagnating economy with rate increase
– AFC-HD AMS Life Science 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 Food Processing industry.
Shortening product life cycle
– it is one of the major threat that AFC-HD AMS Life Science is facing in Food Processing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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.
High dependence on third party suppliers
– AFC-HD AMS Life Science 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, AFC-HD AMS Life Science may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Food Processing sector.
Weighted SWOT Analysis of AFC-HD AMS Life Science Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at AFC-HD AMS Life Science 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 AFC-HD AMS Life Science 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 AFC-HD AMS Life Science 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 AFC-HD AMS Life Science 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 AFC-HD AMS Life Science needs to make to build a sustainable competitive advantage.