SWOT Analysis / TOWS Matrix for Wallenius Wilhelmsen (United Kingdom)
Based on various researches at Oak Spring University , Wallenius Wilhelmsen is operating in a macro-environment that has been destablized by – competitive advantages are harder to sustain because of technology dispersion, there is backlash against globalization, increasing household debt because of falling income levels, increasing transportation and logistics costs, central banks are concerned over increasing inflation, banking and financial system is disrupted by Bitcoin and other crypto currencies, there is increasing trade war between United States & China,
talent flight as more people leaving formal jobs, increasing energy prices, etc
Introduction to SWOT Analysis of Wallenius Wilhelmsen
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Wallenius Wilhelmsen can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Wallenius Wilhelmsen, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Wallenius Wilhelmsen 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 Wallenius Wilhelmsen can be done for the following purposes –
1. Strategic planning of Wallenius Wilhelmsen
2. Improving business portfolio management of Wallenius Wilhelmsen
3. Assessing feasibility of the new initiative in United Kingdom
4. Making a Water Transportation sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Wallenius Wilhelmsen
Strengths of Wallenius Wilhelmsen | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Wallenius Wilhelmsen are -
Learning organization
- Wallenius Wilhelmsen 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 Wallenius Wilhelmsen is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Wallenius Wilhelmsen emphasize – knowledge, initiative, and innovation.
Digital Transformation in Water Transportation industry
- digital transformation varies from industry to industry. For Wallenius Wilhelmsen digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Wallenius Wilhelmsen 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.
Organizational Resilience of Wallenius Wilhelmsen
– The covid-19 pandemic has put organizational resilience at the centre of everthing Wallenius Wilhelmsen does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Diverse revenue streams
– Wallenius Wilhelmsen is present in almost all the verticals within the Water Transportation industry. This has provided Wallenius Wilhelmsen 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.
Sustainable margins compare to other players in Water Transportation industry
– Wallenius Wilhelmsen has clearly differentiated products in the market place. This has enabled Wallenius Wilhelmsen to fetch slight price premium compare to the competitors in the Water Transportation industry. The sustainable margins have also helped Wallenius Wilhelmsen to invest into research and development (R&D) and innovation.
Analytics focus
– Wallenius Wilhelmsen 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 Water Transportation industry. The technology infrastructure of United Kingdom 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.
Cross disciplinary teams
– Horizontal connected teams at the Wallenius Wilhelmsen 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.
Innovation driven organization
– Wallenius Wilhelmsen is one of the most innovative firm in Water Transportation sector.
Strong track record of project management in the Water Transportation industry
– Wallenius Wilhelmsen 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
– Wallenius Wilhelmsen is one of the leading players in the Water Transportation industry in United Kingdom. It is in a position to attract the best talent available in United Kingdom. The firm has a robust talent identification program that helps in identifying the brightest.
Operational resilience
– The operational resilience strategy of Wallenius Wilhelmsen comprises – understanding the underlying the factors in the Water Transportation 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.
High switching costs
– The high switching costs that Wallenius Wilhelmsen has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Weaknesses of Wallenius Wilhelmsen | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Wallenius Wilhelmsen are -
High dependence on Wallenius Wilhelmsen ‘s star products
– The top 2 products and services of Wallenius Wilhelmsen still accounts for major business revenue. This dependence on star products in Water Transportation industry has resulted into insufficient focus on developing new products, even though Wallenius Wilhelmsen has relatively successful track record of launching new products.
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 Wallenius Wilhelmsen supply chain. Even after few cautionary changes, Wallenius Wilhelmsen is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Wallenius Wilhelmsen vulnerable to further global disruptions in South East Asia.
Products dominated business model
– Even though Wallenius Wilhelmsen has some of the most successful models in the Water Transportation industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Wallenius Wilhelmsen should strive to include more intangible value offerings along with its core products and services.
High bargaining power of channel partners in Water Transportation industry
– because of the regulatory requirements in United Kingdom, Wallenius Wilhelmsen 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 Water Transportation industry.
High operating costs
– Compare to the competitors, Wallenius Wilhelmsen has high operating costs in the Water Transportation industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Wallenius Wilhelmsen lucrative customers.
Employees’ less understanding of Wallenius Wilhelmsen strategy
– From the outside it seems that the employees of Wallenius Wilhelmsen 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.
Ability to respond to the competition
– As the decision making is very deliberative at Wallenius Wilhelmsen, in the dynamic environment of Water Transportation industry it has struggled to respond to the nimble upstart competition. Wallenius Wilhelmsen has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Aligning sales with marketing
– From the outside it seems that Wallenius Wilhelmsen needs to have more collaboration between its sales team and marketing team. Sales professionals in the Water Transportation industry have deep experience in developing customer relationships. Marketing department at Wallenius Wilhelmsen can leverage the sales team experience to cultivate customer relationships as Wallenius Wilhelmsen is planning to shift buying processes online.
Workers concerns about automation
– As automation is fast increasing in the Water Transportation industry, Wallenius Wilhelmsen 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, Wallenius Wilhelmsen 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 Water Transportation industry using digital technology.
Low market penetration in new markets
– Outside its home market of United Kingdom, Wallenius Wilhelmsen needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Wallenius Wilhelmsen Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Wallenius Wilhelmsen are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Wallenius Wilhelmsen 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 Wallenius Wilhelmsen 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 Water Transportation industry.
Use of Bitcoin and other crypto currencies for transactions in Water Transportation industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Wallenius Wilhelmsen in the Water Transportation industry. Now Wallenius Wilhelmsen can target international markets with far fewer capital restrictions requirements than the existing system.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Wallenius Wilhelmsen 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 Wallenius Wilhelmsen to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Learning at scale
– Online learning technologies has now opened space for Wallenius Wilhelmsen 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Wallenius Wilhelmsen is facing challenges because of the dominance of functional experts in the organization. Wallenius Wilhelmsen can utilize new technology in the field of Water Transportation industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Water Transportation industry, but it has also influenced the consumer preferences. Wallenius Wilhelmsen can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Developing new processes and practices
– Wallenius Wilhelmsen can develop new processes and procedures in Water Transportation 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Water Transportation industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Wallenius Wilhelmsen 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. Wallenius Wilhelmsen 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.
Creating value in data economy
– The success of analytics program of Wallenius Wilhelmsen has opened avenues for new revenue streams for the organization in Water Transportation industry. This can help Wallenius Wilhelmsen to build a more holistic ecosystem for Wallenius Wilhelmsen products in the Water Transportation industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Better consumer reach
– The expansion of the 5G network will help Wallenius Wilhelmsen to increase its market reach. Wallenius Wilhelmsen 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.
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. Wallenius Wilhelmsen can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 Wallenius Wilhelmsen 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.
Threats Wallenius Wilhelmsen External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Wallenius Wilhelmsen are -
Increasing wage structure of Wallenius Wilhelmsen
– 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 Wallenius Wilhelmsen.
Shortening product life cycle
– it is one of the major threat that Wallenius Wilhelmsen is facing in Water Transportation 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.
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 Wallenius Wilhelmsen in the Water Transportation 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, Wallenius Wilhelmsen may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Water Transportation sector.
Environmental challenges
– Wallenius Wilhelmsen 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. Wallenius Wilhelmsen can take advantage of this fund but it will also bring new competitors in the Water Transportation 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. Wallenius Wilhelmsen 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.
Regulatory challenges
– Wallenius Wilhelmsen 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 Water Transportation industry regulations.
Easy access to finance
– Easy access to finance in Water Transportation industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Wallenius Wilhelmsen can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Technology acceleration in Forth Industrial Revolution
– Wallenius Wilhelmsen has witnessed rapid integration of technology during Covid-19 in the Water Transportation industry. As one of the leading players in the industry, Wallenius Wilhelmsen needs to keep up with the evolution of technology in the Water Transportation 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Wallenius Wilhelmsen in Water Transportation industry. The Water Transportation 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.
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. Wallenius Wilhelmsen needs to understand the core reasons impacting the Water Transportation industry. This will help it in building a better workplace.
Weighted SWOT Analysis of Wallenius Wilhelmsen Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Wallenius Wilhelmsen 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 Wallenius Wilhelmsen 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 Wallenius Wilhelmsen 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 Wallenius Wilhelmsen 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 Wallenius Wilhelmsen needs to make to build a sustainable competitive advantage.
