SWOT Analysis / TOWS Matrix for Hargreaves Services (United Kingdom)
Based on various researches at Oak Spring University , Hargreaves Services is operating in a macro-environment that has been destablized by – increasing household debt because of falling income levels, geopolitical disruptions, increasing commodity prices, increasing energy prices, supply chains are disrupted by pandemic , increasing government debt because of Covid-19 spendings, wage bills are increasing,
technology disruption, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Hargreaves Services
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Hargreaves Services can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Hargreaves Services, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Hargreaves Services 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 Hargreaves Services can be done for the following purposes –
1. Strategic planning of Hargreaves Services
2. Improving business portfolio management of Hargreaves Services
3. Assessing feasibility of the new initiative in United Kingdom
4. Making a Coal sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Hargreaves Services
Strengths of Hargreaves Services | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Hargreaves Services are -
Organizational Resilience of Hargreaves Services
– The covid-19 pandemic has put organizational resilience at the centre of everthing Hargreaves Services does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Superior customer experience
– The customer experience strategy of Hargreaves Services in Coal industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– Hargreaves Services has one of the best training and development program in Energy industry. The effectiveness of the training programs can be measured in – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
High switching costs
– The high switching costs that Hargreaves Services 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.
Low bargaining power of suppliers
– Suppliers of Hargreaves Services in the Energy sector have low bargaining power. Hargreaves Services has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Hargreaves Services to manage not only supply disruptions but also source products at highly competitive prices.
Strong track record of project management in the Coal industry
– Hargreaves Services is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Cross disciplinary teams
– Horizontal connected teams at the Hargreaves Services 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.
Operational resilience
– The operational resilience strategy of Hargreaves Services comprises – understanding the underlying the factors in the Coal 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.
Analytics focus
– Hargreaves Services 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 Coal 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.
Innovation driven organization
– Hargreaves Services is one of the most innovative firm in Coal sector.
Successful track record of launching new products
– Hargreaves Services has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Hargreaves Services 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.
Digital Transformation in Coal industry
- digital transformation varies from industry to industry. For Hargreaves Services digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Hargreaves Services 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.
Weaknesses of Hargreaves Services | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Hargreaves Services are -
Slow decision making process
– As mentioned earlier in the report, Hargreaves Services has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Coal industry over the last five years. Hargreaves Services 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.
Low market penetration in new markets
– Outside its home market of United Kingdom, Hargreaves Services needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High bargaining power of channel partners in Coal industry
– because of the regulatory requirements in United Kingdom, Hargreaves Services 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 Coal industry.
High operating costs
– Compare to the competitors, Hargreaves Services has high operating costs in the Coal industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Hargreaves Services lucrative customers.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Hargreaves Services is slow explore the new channels of communication. These new channels of communication can help Hargreaves Services to provide better information regarding Coal products and services. It can also build an online community to further reach out to potential customers.
Compensation and incentives
– The revenue per employee of Hargreaves Services is just above the Coal industry average. It needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Employees’ less understanding of Hargreaves Services strategy
– From the outside it seems that the employees of Hargreaves Services 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.
Lack of clear differentiation of Hargreaves Services products
– To increase the profitability and margins on the products, Hargreaves Services needs to provide more differentiated products than what it is currently offering in the marketplace.
Increasing silos among functional specialists
– The organizational structure of Hargreaves Services is dominated by functional specialists. It is not different from other players in the Coal industry, but Hargreaves Services needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Hargreaves Services to focus more on services in the Coal industry rather than just following the product oriented approach.
Products dominated business model
– Even though Hargreaves Services has some of the most successful models in the Coal industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Hargreaves Services should strive to include more intangible value offerings along with its core products and services.
High dependence on Hargreaves Services ‘s star products
– The top 2 products and services of Hargreaves Services still accounts for major business revenue. This dependence on star products in Coal industry has resulted into insufficient focus on developing new products, even though Hargreaves Services has relatively successful track record of launching new products.
Hargreaves Services Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Hargreaves Services are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Hargreaves Services in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Coal industry, and it will provide faster access to the consumers.
Building a culture of innovation
– managers at Hargreaves Services 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 Coal industry.
Better consumer reach
– The expansion of the 5G network will help Hargreaves Services to increase its market reach. Hargreaves Services 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.
Developing new processes and practices
– Hargreaves Services can develop new processes and procedures in Coal 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Hargreaves Services 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 Hargreaves Services to hire the very best people irrespective of their geographical location.
Buying journey improvements
– Hargreaves Services can improve the customer journey of consumers in the Coal 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.
Leveraging digital technologies
– Hargreaves Services 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.
Learning at scale
– Online learning technologies has now opened space for Hargreaves Services 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.
Manufacturing automation
– Hargreaves Services can use the latest technology developments to improve its manufacturing and designing process in Coal 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Coal industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Hargreaves Services 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. Hargreaves Services 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Hargreaves Services 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Hargreaves Services can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Hargreaves Services can use these opportunities to build new business models that can help the communities that Hargreaves Services operates in. Secondly it can use opportunities from government spending in Coal sector.
Threats Hargreaves Services External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Hargreaves Services are -
Consumer confidence and its impact on Hargreaves Services 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 Coal industry and other sectors.
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.
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 Hargreaves Services business can come under increasing regulations regarding data privacy, data security, etc.
Shortening product life cycle
– it is one of the major threat that Hargreaves Services is facing in Coal sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Environmental challenges
– Hargreaves Services 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. Hargreaves Services can take advantage of this fund but it will also bring new competitors in the Coal industry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Hargreaves Services may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Coal sector.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Coal industry are lowering. It can presents Hargreaves Services with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Coal sector.
Regulatory challenges
– Hargreaves Services 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 Coal industry regulations.
High dependence on third party suppliers
– Hargreaves Services 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.
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 Hargreaves Services in the Coal sector and impact the bottomline of the organization.
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. Hargreaves Services needs to understand the core reasons impacting the Coal industry. This will help it in building a better workplace.
Technology acceleration in Forth Industrial Revolution
– Hargreaves Services has witnessed rapid integration of technology during Covid-19 in the Coal industry. As one of the leading players in the industry, Hargreaves Services needs to keep up with the evolution of technology in the Coal 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.
Increasing wage structure of Hargreaves Services
– 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 Hargreaves Services.
Weighted SWOT Analysis of Hargreaves Services Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Hargreaves Services 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 Hargreaves Services 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 Hargreaves Services 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 Hargreaves Services 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 Hargreaves Services needs to make to build a sustainable competitive advantage.
