SWOT Analysis / TOWS Matrix for Smartgroup Corporation Ltd (Australia)
Based on various researches at Oak Spring University , Smartgroup Corporation Ltd is operating in a macro-environment that has been destablized by – increasing commodity prices, geopolitical disruptions, talent flight as more people leaving formal jobs, increasing transportation and logistics costs, customer relationship management is fast transforming because of increasing concerns over data privacy, there is backlash against globalization, digital marketing is dominated by two big players Facebook and Google,
cloud computing is disrupting traditional business models, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of Smartgroup Corporation Ltd
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Smartgroup Corporation Ltd can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Smartgroup Corporation Ltd, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Smartgroup Corporation Ltd 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 Smartgroup Corporation Ltd can be done for the following purposes –
1. Strategic planning of Smartgroup Corporation Ltd
2. Improving business portfolio management of Smartgroup Corporation Ltd
3. Assessing feasibility of the new initiative in Australia
4. Making a Computer Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Smartgroup Corporation Ltd
Strengths of Smartgroup Corporation Ltd | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Smartgroup Corporation Ltd are -
Ability to lead change in Computer Services
– Smartgroup Corporation Ltd is one of the leading players in the Computer Services industry in Australia. Over the years it has not only transformed the business landscape in the Computer Services industry in Australia but also across the existing markets. The ability to lead change has enabled Smartgroup Corporation Ltd in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Highly skilled collaborators
– Smartgroup Corporation Ltd has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Computer Services industry. Secondly the value chain collaborators of Smartgroup Corporation Ltd have helped the firm to develop new products and bring them quickly to the marketplace.
Diverse revenue streams
– Smartgroup Corporation Ltd is present in almost all the verticals within the Computer Services industry. This has provided Smartgroup Corporation Ltd 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.
Ability to recruit top talent
– Smartgroup Corporation Ltd is one of the leading players in the Computer Services 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.
Low bargaining power of suppliers
– Suppliers of Smartgroup Corporation Ltd in the Technology sector have low bargaining power. Smartgroup Corporation Ltd has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Smartgroup Corporation Ltd to manage not only supply disruptions but also source products at highly competitive prices.
Organizational Resilience of Smartgroup Corporation Ltd
– The covid-19 pandemic has put organizational resilience at the centre of everthing Smartgroup Corporation Ltd does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Operational resilience
– The operational resilience strategy of Smartgroup Corporation Ltd comprises – understanding the underlying the factors in the Computer Services 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 brand equity
– Smartgroup Corporation Ltd has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Smartgroup Corporation Ltd to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Strong track record of project management in the Computer Services industry
– Smartgroup Corporation Ltd is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Sustainable margins compare to other players in Computer Services industry
– Smartgroup Corporation Ltd has clearly differentiated products in the market place. This has enabled Smartgroup Corporation Ltd to fetch slight price premium compare to the competitors in the Computer Services industry. The sustainable margins have also helped Smartgroup Corporation Ltd to invest into research and development (R&D) and innovation.
Training and development
– Smartgroup Corporation Ltd has one of the best training and development program in Technology 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.
Cross disciplinary teams
– Horizontal connected teams at the Smartgroup Corporation Ltd 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.
Weaknesses of Smartgroup Corporation Ltd | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Smartgroup Corporation Ltd are -
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 Smartgroup Corporation Ltd supply chain. Even after few cautionary changes, Smartgroup Corporation Ltd is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Smartgroup Corporation Ltd vulnerable to further global disruptions in South East Asia.
Interest costs
– Compare to the competition, Smartgroup Corporation Ltd 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.
Aligning sales with marketing
– From the outside it seems that Smartgroup Corporation Ltd needs to have more collaboration between its sales team and marketing team. Sales professionals in the Computer Services industry have deep experience in developing customer relationships. Marketing department at Smartgroup Corporation Ltd can leverage the sales team experience to cultivate customer relationships as Smartgroup Corporation Ltd is planning to shift buying processes online.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Smartgroup Corporation Ltd is slow explore the new channels of communication. These new channels of communication can help Smartgroup Corporation Ltd to provide better information regarding Computer Services products and services. It can also build an online community to further reach out to potential customers.
High cash cycle compare to competitors
Smartgroup Corporation Ltd has a high cash cycle compare to other players in the Computer Services industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Employees’ less understanding of Smartgroup Corporation Ltd strategy
– From the outside it seems that the employees of Smartgroup Corporation Ltd 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.
Slow to strategic competitive environment developments
– As Smartgroup Corporation Ltd is one of the leading players in the Computer Services industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Computer Services industry in last five years.
Products dominated business model
– Even though Smartgroup Corporation Ltd has some of the most successful models in the Computer Services industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Smartgroup Corporation Ltd should strive to include more intangible value offerings along with its core products and services.
Need for greater diversity
– Smartgroup Corporation Ltd 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.
No frontier risks strategy
– From the 10K / annual statement of Smartgroup Corporation Ltd, it seems that company is thinking out the frontier risks that can impact Computer Services 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.
Low market penetration in new markets
– Outside its home market of Australia, Smartgroup Corporation Ltd needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Smartgroup Corporation Ltd Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Smartgroup Corporation Ltd are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Smartgroup Corporation Ltd is facing challenges because of the dominance of functional experts in the organization. Smartgroup Corporation Ltd can utilize new technology in the field of Computer Services industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Smartgroup Corporation Ltd can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Smartgroup Corporation Ltd 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 Smartgroup Corporation Ltd to hire the very best people irrespective of their geographical location.
Loyalty marketing
– Smartgroup Corporation Ltd 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Computer Services industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Smartgroup Corporation Ltd 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. Smartgroup Corporation Ltd 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, Smartgroup Corporation Ltd can use these opportunities to build new business models that can help the communities that Smartgroup Corporation Ltd operates in. Secondly it can use opportunities from government spending in Computer Services sector.
Buying journey improvements
– Smartgroup Corporation Ltd can improve the customer journey of consumers in the Computer Services 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.
Creating value in data economy
– The success of analytics program of Smartgroup Corporation Ltd has opened avenues for new revenue streams for the organization in Computer Services industry. This can help Smartgroup Corporation Ltd to build a more holistic ecosystem for Smartgroup Corporation Ltd products in the Computer Services industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Learning at scale
– Online learning technologies has now opened space for Smartgroup Corporation Ltd 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.
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. Smartgroup Corporation Ltd can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Leveraging digital technologies
– Smartgroup Corporation Ltd 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.
Using analytics as competitive advantage
– Smartgroup Corporation Ltd has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Computer Services sector. This continuous investment in analytics has enabled Smartgroup Corporation Ltd to build a competitive advantage using analytics. The analytics driven competitive advantage can help Smartgroup Corporation Ltd to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Manufacturing automation
– Smartgroup Corporation Ltd can use the latest technology developments to improve its manufacturing and designing process in Computer Services 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.
Threats Smartgroup Corporation Ltd External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Smartgroup Corporation Ltd are -
Shortening product life cycle
– it is one of the major threat that Smartgroup Corporation Ltd is facing in Computer Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Easy access to finance
– Easy access to finance in Computer Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Smartgroup Corporation Ltd can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Smartgroup Corporation Ltd business can come under increasing regulations regarding data privacy, data security, etc.
Consumer confidence and its impact on Smartgroup Corporation Ltd 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 Computer Services industry and other sectors.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Smartgroup Corporation Ltd 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 Smartgroup Corporation Ltd prominent markets.
High dependence on third party suppliers
– Smartgroup Corporation Ltd 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Smartgroup Corporation Ltd in Computer Services industry. The Computer Services 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.
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 Smartgroup Corporation Ltd.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Smartgroup Corporation Ltd may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Computer Services sector.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Computer Services industry are lowering. It can presents Smartgroup Corporation Ltd with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Computer Services sector.
Stagnating economy with rate increase
– Smartgroup Corporation Ltd 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 Computer Services industry.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Smartgroup Corporation Ltd in the Computer Services sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Smartgroup Corporation Ltd Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Smartgroup Corporation Ltd 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 Smartgroup Corporation Ltd 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 Smartgroup Corporation Ltd 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 Smartgroup Corporation Ltd 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 Smartgroup Corporation Ltd needs to make to build a sustainable competitive advantage.