SWOT Analysis / TOWS Matrix for Mcmillan Shakespeare (Australia)
Based on various researches at Oak Spring University , Mcmillan Shakespeare is operating in a macro-environment that has been destablized by – competitive advantages are harder to sustain because of technology dispersion, central banks are concerned over increasing inflation, customer relationship management is fast transforming because of increasing concerns over data privacy, challanges to central banks by blockchain based private currencies, wage bills are increasing, there is backlash against globalization, supply chains are disrupted by pandemic ,
increasing commodity prices, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Mcmillan Shakespeare
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Mcmillan Shakespeare can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Mcmillan Shakespeare, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Mcmillan Shakespeare 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 Mcmillan Shakespeare can be done for the following purposes –
1. Strategic planning of Mcmillan Shakespeare
2. Improving business portfolio management of Mcmillan Shakespeare
3. Assessing feasibility of the new initiative in Australia
4. Making a Business Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Mcmillan Shakespeare
Strengths of Mcmillan Shakespeare | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Mcmillan Shakespeare are -
Highly skilled collaborators
– Mcmillan Shakespeare has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Business Services industry. Secondly the value chain collaborators of Mcmillan Shakespeare have helped the firm to develop new products and bring them quickly to the marketplace.
Operational resilience
– The operational resilience strategy of Mcmillan Shakespeare comprises – understanding the underlying the factors in the Business 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.
Training and development
– Mcmillan Shakespeare 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.
Cross disciplinary teams
– Horizontal connected teams at the Mcmillan Shakespeare 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.
Ability to lead change in Business Services
– Mcmillan Shakespeare is one of the leading players in the Business Services industry in Australia. Over the years it has not only transformed the business landscape in the Business Services industry in Australia but also across the existing markets. The ability to lead change has enabled Mcmillan Shakespeare in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Effective Research and Development (R&D)
– Mcmillan Shakespeare has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Mcmillan Shakespeare staying ahead in the Business Services industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High brand equity
– Mcmillan Shakespeare has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Mcmillan Shakespeare to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Digital Transformation in Business Services industry
- digital transformation varies from industry to industry. For Mcmillan Shakespeare digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Mcmillan Shakespeare 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 Mcmillan Shakespeare in the Services sector have low bargaining power. Mcmillan Shakespeare has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Mcmillan Shakespeare to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Mcmillan Shakespeare in Business Services industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Diverse revenue streams
– Mcmillan Shakespeare is present in almost all the verticals within the Business Services industry. This has provided Mcmillan Shakespeare 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.
Analytics focus
– Mcmillan Shakespeare 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 Business Services 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.
Weaknesses of Mcmillan Shakespeare | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Mcmillan Shakespeare 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 Mcmillan Shakespeare supply chain. Even after few cautionary changes, Mcmillan Shakespeare is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Mcmillan Shakespeare vulnerable to further global disruptions in South East Asia.
High cash cycle compare to competitors
Mcmillan Shakespeare has a high cash cycle compare to other players in the Business 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.
Low market penetration in new markets
– Outside its home market of Australia, Mcmillan Shakespeare needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Interest costs
– Compare to the competition, Mcmillan Shakespeare 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.
Lack of clear differentiation of Mcmillan Shakespeare products
– To increase the profitability and margins on the products, Mcmillan Shakespeare needs to provide more differentiated products than what it is currently offering in the marketplace.
Need for greater diversity
– Mcmillan Shakespeare 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.
Employees’ less understanding of Mcmillan Shakespeare strategy
– From the outside it seems that the employees of Mcmillan Shakespeare 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.
Skills based hiring in Business Services industry
– The stress on hiring functional specialists at Mcmillan Shakespeare has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Mcmillan Shakespeare 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 Business Services industry using digital technology.
Products dominated business model
– Even though Mcmillan Shakespeare has some of the most successful models in the Business Services industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Mcmillan Shakespeare should strive to include more intangible value offerings along with its core products and services.
Aligning sales with marketing
– From the outside it seems that Mcmillan Shakespeare needs to have more collaboration between its sales team and marketing team. Sales professionals in the Business Services industry have deep experience in developing customer relationships. Marketing department at Mcmillan Shakespeare can leverage the sales team experience to cultivate customer relationships as Mcmillan Shakespeare is planning to shift buying processes online.
Mcmillan Shakespeare Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Mcmillan Shakespeare are -
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Business Services industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Mcmillan Shakespeare 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. Mcmillan Shakespeare 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.
Manufacturing automation
– Mcmillan Shakespeare can use the latest technology developments to improve its manufacturing and designing process in Business 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.
Use of Bitcoin and other crypto currencies for transactions in Business Services industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Mcmillan Shakespeare in the Business Services industry. Now Mcmillan Shakespeare can target international markets with far fewer capital restrictions requirements than the existing system.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Business Services industry, but it has also influenced the consumer preferences. Mcmillan Shakespeare can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Low interest rates
– Even though inflation is raising its head in most developed economies, Mcmillan Shakespeare 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.
Using analytics as competitive advantage
– Mcmillan Shakespeare has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Business Services sector. This continuous investment in analytics has enabled Mcmillan Shakespeare to build a competitive advantage using analytics. The analytics driven competitive advantage can help Mcmillan Shakespeare to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Mcmillan Shakespeare can use these opportunities to build new business models that can help the communities that Mcmillan Shakespeare operates in. Secondly it can use opportunities from government spending in Business Services sector.
Better consumer reach
– The expansion of the 5G network will help Mcmillan Shakespeare to increase its market reach. Mcmillan Shakespeare 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.
Learning at scale
– Online learning technologies has now opened space for Mcmillan Shakespeare 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.
Building a culture of innovation
– managers at Mcmillan Shakespeare 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 Business Services industry.
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. Mcmillan Shakespeare can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Buying journey improvements
– Mcmillan Shakespeare can improve the customer journey of consumers in the Business 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.
Loyalty marketing
– Mcmillan Shakespeare 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.
Threats Mcmillan Shakespeare External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Mcmillan Shakespeare are -
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 Mcmillan Shakespeare in the Business Services sector and impact the bottomline of the organization.
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 Mcmillan Shakespeare.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Mcmillan Shakespeare 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 Mcmillan Shakespeare prominent markets.
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. Mcmillan Shakespeare 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.
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.
Consumer confidence and its impact on Mcmillan Shakespeare 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 Business Services industry and other sectors.
Easy access to finance
– Easy access to finance in Business Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Mcmillan Shakespeare 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
– Mcmillan Shakespeare 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.
Stagnating economy with rate increase
– Mcmillan Shakespeare 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 Business Services industry.
Regulatory challenges
– Mcmillan Shakespeare 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 Business Services industry regulations.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Mcmillan Shakespeare in Business Services industry. The Business 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.
Increasing wage structure of Mcmillan Shakespeare
– 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 Mcmillan Shakespeare.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Mcmillan Shakespeare may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Business Services sector.
Weighted SWOT Analysis of Mcmillan Shakespeare Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Mcmillan Shakespeare 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 Mcmillan Shakespeare 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 Mcmillan Shakespeare 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 Mcmillan Shakespeare 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 Mcmillan Shakespeare needs to make to build a sustainable competitive advantage.