DiGi.Com (DSOM) SWOT Analysis / TOWS Matrix / MBA Resources
Communications Services
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for DiGi.Com (Malaysia)
Based on various researches at Oak Spring University , DiGi.Com is operating in a macro-environment that has been destablized by – supply chains are disrupted by pandemic , increasing inequality as vast percentage of new income is going to the top 1%, geopolitical disruptions, increasing commodity prices, increasing energy prices, cloud computing is disrupting traditional business models, central banks are concerned over increasing inflation,
digital marketing is dominated by two big players Facebook and Google, increasing household debt because of falling income levels, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that DiGi.Com can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the DiGi.Com, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which DiGi.Com 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 DiGi.Com can be done for the following purposes –
1. Strategic planning of DiGi.Com
2. Improving business portfolio management of DiGi.Com
3. Assessing feasibility of the new initiative in Malaysia
4. Making a Communications Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of DiGi.Com
Strengths of DiGi.Com | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of DiGi.Com are -
Successful track record of launching new products
– DiGi.Com has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. DiGi.Com 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.
Effective Research and Development (R&D)
– DiGi.Com has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – DiGi.Com staying ahead in the Communications Services industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to recruit top talent
– DiGi.Com is one of the leading players in the Communications Services industry in Malaysia. It is in a position to attract the best talent available in Malaysia. The firm has a robust talent identification program that helps in identifying the brightest.
Digital Transformation in Communications Services industry
- digital transformation varies from industry to industry. For DiGi.Com digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. DiGi.Com 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.
Cross disciplinary teams
– Horizontal connected teams at the DiGi.Com 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.
Diverse revenue streams
– DiGi.Com is present in almost all the verticals within the Communications Services industry. This has provided DiGi.Com 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.
Superior customer experience
– The customer experience strategy of DiGi.Com in Communications Services industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Low bargaining power of suppliers
– Suppliers of DiGi.Com in the Services sector have low bargaining power. DiGi.Com has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps DiGi.Com to manage not only supply disruptions but also source products at highly competitive prices.
Sustainable margins compare to other players in Communications Services industry
– DiGi.Com has clearly differentiated products in the market place. This has enabled DiGi.Com to fetch slight price premium compare to the competitors in the Communications Services industry. The sustainable margins have also helped DiGi.Com to invest into research and development (R&D) and innovation.
High brand equity
– DiGi.Com has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled DiGi.Com to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Highly skilled collaborators
– DiGi.Com has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Communications Services industry. Secondly the value chain collaborators of DiGi.Com have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of DiGi.Com
– The covid-19 pandemic has put organizational resilience at the centre of everthing DiGi.Com does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses of DiGi.Com | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of DiGi.Com 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 DiGi.Com supply chain. Even after few cautionary changes, DiGi.Com is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left DiGi.Com vulnerable to further global disruptions in South East Asia.
Increasing silos among functional specialists
– The organizational structure of DiGi.Com is dominated by functional specialists. It is not different from other players in the Communications Services industry, but DiGi.Com needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help DiGi.Com to focus more on services in the Communications Services industry rather than just following the product oriented approach.
High operating costs
– Compare to the competitors, DiGi.Com has high operating costs in the Communications Services industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract DiGi.Com lucrative customers.
Slow to strategic competitive environment developments
– As DiGi.Com is one of the leading players in the Communications Services industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Communications Services industry in last five years.
Workers concerns about automation
– As automation is fast increasing in the Communications Services industry, DiGi.Com 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.
High bargaining power of channel partners in Communications Services industry
– because of the regulatory requirements in Malaysia, DiGi.Com 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 Communications Services industry.
No frontier risks strategy
– From the 10K / annual statement of DiGi.Com, it seems that company is thinking out the frontier risks that can impact Communications 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.
Skills based hiring in Communications Services industry
– The stress on hiring functional specialists at DiGi.Com 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.
Aligning sales with marketing
– From the outside it seems that DiGi.Com needs to have more collaboration between its sales team and marketing team. Sales professionals in the Communications Services industry have deep experience in developing customer relationships. Marketing department at DiGi.Com can leverage the sales team experience to cultivate customer relationships as DiGi.Com is planning to shift buying processes online.
Lack of clear differentiation of DiGi.Com products
– To increase the profitability and margins on the products, DiGi.Com needs to provide more differentiated products than what it is currently offering in the marketplace.
High dependence on DiGi.Com ‘s star products
– The top 2 products and services of DiGi.Com still accounts for major business revenue. This dependence on star products in Communications Services industry has resulted into insufficient focus on developing new products, even though DiGi.Com has relatively successful track record of launching new products.
DiGi.Com Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of DiGi.Com are -
Use of Bitcoin and other crypto currencies for transactions in Communications Services industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for DiGi.Com in the Communications Services industry. Now DiGi.Com can target international markets with far fewer capital restrictions requirements than the existing system.
Low interest rates
– Even though inflation is raising its head in most developed economies, DiGi.Com 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.
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 DiGi.Com 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.
Buying journey improvements
– DiGi.Com can improve the customer journey of consumers in the Communications 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, DiGi.Com is facing challenges because of the dominance of functional experts in the organization. DiGi.Com can utilize new technology in the field of Communications Services industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Building a culture of innovation
– managers at DiGi.Com 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 Communications Services industry.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for DiGi.Com 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 DiGi.Com to hire the very best people irrespective of their geographical location.
Leveraging digital technologies
– DiGi.Com 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.
Manufacturing automation
– DiGi.Com can use the latest technology developments to improve its manufacturing and designing process in Communications 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.
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. DiGi.Com can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects DiGi.Com can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Lowering marketing communication costs
– 5G expansion will open new opportunities for DiGi.Com in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Communications Services industry, and it will provide faster access to the consumers.
Developing new processes and practices
– DiGi.Com can develop new processes and procedures in Communications Services 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 DiGi.Com External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of DiGi.Com are -
Easy access to finance
– Easy access to finance in Communications Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. DiGi.Com can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. DiGi.Com needs to understand the core reasons impacting the Communications Services industry. This will help it in building a better workplace.
Consumer confidence and its impact on DiGi.Com 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 Communications Services industry and other sectors.
Regulatory challenges
– DiGi.Com 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 Communications Services industry regulations.
Environmental challenges
– DiGi.Com 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. DiGi.Com can take advantage of this fund but it will also bring new competitors in the Communications Services industry.
Shortening product life cycle
– it is one of the major threat that DiGi.Com is facing in Communications Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Communications Services industry are lowering. It can presents DiGi.Com with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Communications Services sector.
Technology acceleration in Forth Industrial Revolution
– DiGi.Com has witnessed rapid integration of technology during Covid-19 in the Communications Services industry. As one of the leading players in the industry, DiGi.Com needs to keep up with the evolution of technology in the Communications Services 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 international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, DiGi.Com 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 DiGi.Com prominent markets.
Stagnating economy with rate increase
– DiGi.Com 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 Communications Services industry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, DiGi.Com may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Communications Services sector.
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 DiGi.Com in the Communications Services sector and impact the bottomline of the organization.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for DiGi.Com in Communications Services industry. The Communications 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.
Weighted SWOT Analysis of DiGi.Com Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at DiGi.Com 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 DiGi.Com 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 DiGi.Com 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 DiGi.Com 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 DiGi.Com needs to make to build a sustainable competitive advantage.