Firestone (FDI) SWOT Analysis / TOWS Matrix / MBA Resources
Non-Metallic Mining
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Firestone (United Kingdom)
Based on various researches at Oak Spring University , Firestone is operating in a macro-environment that has been destablized by – increasing household debt because of falling income levels, competitive advantages are harder to sustain because of technology dispersion, increasing government debt because of Covid-19 spendings, increasing inequality as vast percentage of new income is going to the top 1%, technology disruption, increasing transportation and logistics costs, central banks are concerned over increasing inflation,
cloud computing is disrupting traditional business models, there is backlash against globalization, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Firestone can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Firestone, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Firestone 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 Firestone can be done for the following purposes –
1. Strategic planning of Firestone
2. Improving business portfolio management of Firestone
3. Assessing feasibility of the new initiative in United Kingdom
4. Making a Non-Metallic Mining sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Firestone
Strengths of Firestone | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Firestone are -
Digital Transformation in Non-Metallic Mining industry
- digital transformation varies from industry to industry. For Firestone digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Firestone 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.
Ability to recruit top talent
– Firestone is one of the leading players in the Non-Metallic Mining 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.
Training and development
– Firestone has one of the best training and development program in Basic Materials 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.
Low bargaining power of suppliers
– Suppliers of Firestone in the Basic Materials sector have low bargaining power. Firestone has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Firestone to manage not only supply disruptions but also source products at highly competitive prices.
Analytics focus
– Firestone 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 Non-Metallic Mining 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.
Organizational Resilience of Firestone
– The covid-19 pandemic has put organizational resilience at the centre of everthing Firestone does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Sustainable margins compare to other players in Non-Metallic Mining industry
– Firestone has clearly differentiated products in the market place. This has enabled Firestone to fetch slight price premium compare to the competitors in the Non-Metallic Mining industry. The sustainable margins have also helped Firestone to invest into research and development (R&D) and innovation.
Diverse revenue streams
– Firestone is present in almost all the verticals within the Non-Metallic Mining industry. This has provided Firestone 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.
Learning organization
- Firestone 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 Firestone is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Firestone emphasize – knowledge, initiative, and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Firestone 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.
Superior customer experience
– The customer experience strategy of Firestone in Non-Metallic Mining industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Innovation driven organization
– Firestone is one of the most innovative firm in Non-Metallic Mining sector.
Weaknesses of Firestone | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Firestone are -
Slow to strategic competitive environment developments
– As Firestone is one of the leading players in the Non-Metallic Mining industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Non-Metallic Mining industry in last five years.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Firestone is slow explore the new channels of communication. These new channels of communication can help Firestone to provide better information regarding Non-Metallic Mining products and services. It can also build an online community to further reach out to potential customers.
High cash cycle compare to competitors
Firestone has a high cash cycle compare to other players in the Non-Metallic Mining industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Products dominated business model
– Even though Firestone has some of the most successful models in the Non-Metallic Mining industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Firestone should strive to include more intangible value offerings along with its core products and services.
No frontier risks strategy
– From the 10K / annual statement of Firestone, it seems that company is thinking out the frontier risks that can impact Non-Metallic Mining 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.
High operating costs
– Compare to the competitors, Firestone has high operating costs in the Non-Metallic Mining industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Firestone lucrative customers.
Increasing silos among functional specialists
– The organizational structure of Firestone is dominated by functional specialists. It is not different from other players in the Non-Metallic Mining industry, but Firestone needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Firestone to focus more on services in the Non-Metallic Mining industry rather than just following the product oriented approach.
Aligning sales with marketing
– From the outside it seems that Firestone needs to have more collaboration between its sales team and marketing team. Sales professionals in the Non-Metallic Mining industry have deep experience in developing customer relationships. Marketing department at Firestone can leverage the sales team experience to cultivate customer relationships as Firestone is planning to shift buying processes online.
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 Firestone supply chain. Even after few cautionary changes, Firestone is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Firestone vulnerable to further global disruptions in South East Asia.
Compensation and incentives
– The revenue per employee of Firestone is just above the Non-Metallic Mining 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.
Slow decision making process
– As mentioned earlier in the report, Firestone has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Non-Metallic Mining industry over the last five years. Firestone 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.
Firestone Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Firestone are -
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 Firestone 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Firestone is facing challenges because of the dominance of functional experts in the organization. Firestone can utilize new technology in the field of Non-Metallic Mining industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Using analytics as competitive advantage
– Firestone has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Non-Metallic Mining sector. This continuous investment in analytics has enabled Firestone to build a competitive advantage using analytics. The analytics driven competitive advantage can help Firestone to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Low interest rates
– Even though inflation is raising its head in most developed economies, Firestone 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.
Learning at scale
– Online learning technologies has now opened space for Firestone 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
– Firestone can use the latest technology developments to improve its manufacturing and designing process in Non-Metallic Mining 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.
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. Firestone can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Creating value in data economy
– The success of analytics program of Firestone has opened avenues for new revenue streams for the organization in Non-Metallic Mining industry. This can help Firestone to build a more holistic ecosystem for Firestone products in the Non-Metallic Mining 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 Firestone to increase its market reach. Firestone 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Firestone can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Firestone 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 Firestone to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Building a culture of innovation
– managers at Firestone 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 Non-Metallic Mining industry.
Developing new processes and practices
– Firestone can develop new processes and procedures in Non-Metallic Mining 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.
Threats Firestone External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Firestone are -
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. Firestone needs to understand the core reasons impacting the Non-Metallic Mining industry. This will help it in building a better workplace.
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 Firestone business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Firestone high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Firestone may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Non-Metallic Mining sector.
Technology acceleration in Forth Industrial Revolution
– Firestone has witnessed rapid integration of technology during Covid-19 in the Non-Metallic Mining industry. As one of the leading players in the industry, Firestone needs to keep up with the evolution of technology in the Non-Metallic Mining 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 Firestone in Non-Metallic Mining industry. The Non-Metallic Mining 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.
Increasing wage structure of Firestone
– 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 Firestone.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Non-Metallic Mining industry are lowering. It can presents Firestone with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Non-Metallic Mining sector.
Stagnating economy with rate increase
– Firestone 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 Non-Metallic Mining industry.
Consumer confidence and its impact on Firestone 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 Non-Metallic Mining industry and other sectors.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Firestone.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Firestone 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 Firestone prominent markets.
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.
Weighted SWOT Analysis of Firestone Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Firestone 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 Firestone 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 Firestone 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 Firestone 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 Firestone needs to make to build a sustainable competitive advantage.
