Fairfax Media (FXJ) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Fairfax Media (Australia)

Based on various researches at Oak Spring University , Fairfax Media is operating in a macro-environment that has been destablized by – technology disruption, customer relationship management is fast transforming because of increasing concerns over data privacy, cloud computing is disrupting traditional business models, talent flight as more people leaving formal jobs, competitive advantages are harder to sustain because of technology dispersion, increasing government debt because of Covid-19 spendings, increasing energy prices, there is backlash against globalization, digital marketing is dominated by two big players Facebook and Google, etc

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Introduction to SWOT Analysis of Fairfax Media

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Fairfax Media can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Fairfax Media, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Fairfax Media 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of Fairfax Media can be done for the following purposes –
1. Strategic planning of Fairfax Media
2. Improving business portfolio management of Fairfax Media
3. Assessing feasibility of the new initiative in Australia
4. Making a Printing & Publishing sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Fairfax Media

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Strengths of Fairfax Media | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Fairfax Media are -

Sustainable margins compare to other players in Printing & Publishing industry

– Fairfax Media has clearly differentiated products in the market place. This has enabled Fairfax Media to fetch slight price premium compare to the competitors in the Printing & Publishing industry. The sustainable margins have also helped Fairfax Media to invest into research and development (R&D) and innovation.

Effective Research and Development (R&D)

– Fairfax Media has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Fairfax Media staying ahead in the Printing & Publishing industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

Organizational Resilience of Fairfax Media

– The covid-19 pandemic has put organizational resilience at the centre of everthing Fairfax Media 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 Printing & Publishing industry

– Fairfax Media is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Ability to recruit top talent

– Fairfax Media is one of the leading players in the Printing & Publishing industry in Australia. It is in a position to attract the best talent available in Australia. The firm has a robust talent identification program that helps in identifying the brightest.

Operational resilience

– The operational resilience strategy of Fairfax Media comprises – understanding the underlying the factors in the Printing & Publishing 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.

Digital Transformation in Printing & Publishing industry

- digital transformation varies from industry to industry. For Fairfax Media digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Fairfax Media 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.

Low bargaining power of suppliers

– Suppliers of Fairfax Media in the Services sector have low bargaining power. Fairfax Media has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Fairfax Media to manage not only supply disruptions but also source products at highly competitive prices.

Diverse revenue streams

– Fairfax Media is present in almost all the verticals within the Printing & Publishing industry. This has provided Fairfax Media 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.

Training and development

– Fairfax Media has one of the best training and development program in Services 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.

Analytics focus

– Fairfax Media 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 Printing & Publishing industry. The technology infrastructure of Australia is also helping it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.

Innovation driven organization

– Fairfax Media is one of the most innovative firm in Printing & Publishing sector.

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Weaknesses of Fairfax Media | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Fairfax Media are -

Slow decision making process

– As mentioned earlier in the report, Fairfax Media has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Printing & Publishing industry over the last five years. Fairfax Media 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.

Products dominated business model

– Even though Fairfax Media has some of the most successful models in the Printing & Publishing industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Fairfax Media should strive to include more intangible value offerings along with its core products and services.

Interest costs

– Compare to the competition, Fairfax Media 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.

Ability to respond to the competition

– As the decision making is very deliberative at Fairfax Media, in the dynamic environment of Printing & Publishing industry it has struggled to respond to the nimble upstart competition. Fairfax Media has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

Slow to strategic competitive environment developments

– As Fairfax Media is one of the leading players in the Printing & Publishing industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Printing & Publishing industry in last five years.

Employees’ less understanding of Fairfax Media strategy

– From the outside it seems that the employees of Fairfax Media don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.

Aligning sales with marketing

– From the outside it seems that Fairfax Media needs to have more collaboration between its sales team and marketing team. Sales professionals in the Printing & Publishing industry have deep experience in developing customer relationships. Marketing department at Fairfax Media can leverage the sales team experience to cultivate customer relationships as Fairfax Media is planning to shift buying processes online.

Workers concerns about automation

– As automation is fast increasing in the Printing & Publishing industry, Fairfax Media 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.

Capital Spending Reduction

– Even during the low interest decade, Fairfax Media 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 Printing & Publishing industry using digital technology.

Need for greater diversity

– Fairfax Media 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.

Lack of clear differentiation of Fairfax Media products

– To increase the profitability and margins on the products, Fairfax Media needs to provide more differentiated products than what it is currently offering in the marketplace.

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Fairfax Media Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of Fairfax Media are -

Developing new processes and practices

– Fairfax Media can develop new processes and procedures in Printing & Publishing 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.

Low interest rates

– Even though inflation is raising its head in most developed economies, Fairfax Media 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.

Manufacturing automation

– Fairfax Media can use the latest technology developments to improve its manufacturing and designing process in Printing & Publishing sector. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.

Reconfiguring business model

– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Fairfax Media 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.

Changes in consumer behavior post Covid-19

– consumer behavior has changed in the Printing & Publishing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Fairfax Media 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. Fairfax Media 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.

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. Fairfax Media can explore opportunities that can attract volunteers and are consistent with its mission and vision.

Finding new ways to collaborate

– Covid-19 has not only transformed business models of companies in Printing & Publishing industry, but it has also influenced the consumer preferences. Fairfax Media can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

Redefining models of collaboration and team work

– As explained in the weaknesses section, Fairfax Media is facing challenges because of the dominance of functional experts in the organization. Fairfax Media can utilize new technology in the field of Printing & Publishing industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, Fairfax Media 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 Fairfax Media to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects Fairfax Media can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

Buying journey improvements

– Fairfax Media can improve the customer journey of consumers in the Printing & Publishing 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.

Using analytics as competitive advantage

– Fairfax Media has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Printing & Publishing sector. This continuous investment in analytics has enabled Fairfax Media to build a competitive advantage using analytics. The analytics driven competitive advantage can help Fairfax Media to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.

Loyalty marketing

– Fairfax Media 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.

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Threats Fairfax Media External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of Fairfax Media are -

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Fairfax Media in Printing & Publishing industry. The Printing & Publishing 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.

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, Fairfax Media may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Printing & Publishing sector.

Environmental challenges

– Fairfax Media 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. Fairfax Media can take advantage of this fund but it will also bring new competitors in the Printing & Publishing industry.

Easy access to finance

– Easy access to finance in Printing & Publishing industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Fairfax Media can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.

High dependence on third party suppliers

– Fairfax Media 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 Printing & Publishing industry are lowering. It can presents Fairfax Media with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Printing & Publishing sector.

Consumer confidence and its impact on Fairfax Media 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 Printing & Publishing industry and other sectors.

Increasing wage structure of Fairfax Media

– 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 Fairfax Media.

Regulatory challenges

– Fairfax Media 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 Printing & Publishing industry regulations.

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. Fairfax Media needs to understand the core reasons impacting the Printing & Publishing industry. This will help it in building a better workplace.

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 Fairfax Media in the Printing & Publishing sector and impact the bottomline of the organization.

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.

Technology acceleration in Forth Industrial Revolution

– Fairfax Media has witnessed rapid integration of technology during Covid-19 in the Printing & Publishing industry. As one of the leading players in the industry, Fairfax Media needs to keep up with the evolution of technology in the Printing & Publishing 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.

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Weighted SWOT Analysis of Fairfax Media Template, Example

Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Fairfax Media 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 Fairfax Media 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 Fairfax Media 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 Fairfax Media 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 Fairfax Media needs to make to build a sustainable competitive advantage.

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