United Malacca (UMRS) SWOT Analysis / TOWS Matrix / MBA Resources
Crops
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for United Malacca (Malaysia)
Based on various researches at Oak Spring University , United Malacca is operating in a macro-environment that has been destablized by – wage bills are increasing, digital marketing is dominated by two big players Facebook and Google, technology disruption, supply chains are disrupted by pandemic , increasing government debt because of Covid-19 spendings, central banks are concerned over increasing inflation, banking and financial system is disrupted by Bitcoin and other crypto currencies,
increasing inequality as vast percentage of new income is going to the top 1%, talent flight as more people leaving formal jobs, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that United Malacca can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the United Malacca, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which United Malacca 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 United Malacca can be done for the following purposes –
1. Strategic planning of United Malacca
2. Improving business portfolio management of United Malacca
3. Assessing feasibility of the new initiative in Malaysia
4. Making a Crops sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of United Malacca
Strengths of United Malacca | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of United Malacca are -
Organizational Resilience of United Malacca
– The covid-19 pandemic has put organizational resilience at the centre of everthing United Malacca does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Low bargaining power of suppliers
– Suppliers of United Malacca in the Consumer/Non-Cyclical sector have low bargaining power. United Malacca has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps United Malacca to manage not only supply disruptions but also source products at highly competitive prices.
High brand equity
– United Malacca has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled United Malacca to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Successful track record of launching new products
– United Malacca has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. United Malacca 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.
Operational resilience
– The operational resilience strategy of United Malacca comprises – understanding the underlying the factors in the Crops 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.
Digital Transformation in Crops industry
- digital transformation varies from industry to industry. For United Malacca digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. United Malacca 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.
Strong track record of project management in the Crops industry
– United Malacca 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 Crops industry
– United Malacca has clearly differentiated products in the market place. This has enabled United Malacca to fetch slight price premium compare to the competitors in the Crops industry. The sustainable margins have also helped United Malacca to invest into research and development (R&D) and innovation.
Innovation driven organization
– United Malacca is one of the most innovative firm in Crops sector.
Learning organization
- United Malacca 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 United Malacca is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at United Malacca emphasize – knowledge, initiative, and innovation.
High switching costs
– The high switching costs that United Malacca 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.
Highly skilled collaborators
– United Malacca has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Crops industry. Secondly the value chain collaborators of United Malacca have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses of United Malacca | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of United Malacca 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 United Malacca supply chain. Even after few cautionary changes, United Malacca is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left United Malacca vulnerable to further global disruptions in South East Asia.
Aligning sales with marketing
– From the outside it seems that United Malacca needs to have more collaboration between its sales team and marketing team. Sales professionals in the Crops industry have deep experience in developing customer relationships. Marketing department at United Malacca can leverage the sales team experience to cultivate customer relationships as United Malacca is planning to shift buying processes online.
Lack of clear differentiation of United Malacca products
– To increase the profitability and margins on the products, United Malacca needs to provide more differentiated products than what it is currently offering in the marketplace.
Products dominated business model
– Even though United Malacca has some of the most successful models in the Crops industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. United Malacca should strive to include more intangible value offerings along with its core products and services.
Slow to strategic competitive environment developments
– As United Malacca is one of the leading players in the Crops industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Crops industry in last five years.
Low market penetration in new markets
– Outside its home market of Malaysia, United Malacca needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Increasing silos among functional specialists
– The organizational structure of United Malacca is dominated by functional specialists. It is not different from other players in the Crops industry, but United Malacca needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help United Malacca to focus more on services in the Crops industry rather than just following the product oriented approach.
Employees’ less understanding of United Malacca strategy
– From the outside it seems that the employees of United Malacca 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.
High bargaining power of channel partners in Crops industry
– because of the regulatory requirements in Malaysia, United Malacca 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 Crops industry.
Slow decision making process
– As mentioned earlier in the report, United Malacca has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Crops industry over the last five years. United Malacca 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.
Ability to respond to the competition
– As the decision making is very deliberative at United Malacca, in the dynamic environment of Crops industry it has struggled to respond to the nimble upstart competition. United Malacca has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
United Malacca Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of United Malacca are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for United Malacca in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Crops industry, and it will provide faster access to the consumers.
Building a culture of innovation
– managers at United Malacca 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 Crops industry.
Creating value in data economy
– The success of analytics program of United Malacca has opened avenues for new revenue streams for the organization in Crops industry. This can help United Malacca to build a more holistic ecosystem for United Malacca products in the Crops 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 United Malacca to increase its market reach. United Malacca 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.
Use of Bitcoin and other crypto currencies for transactions in Crops industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for United Malacca in the Crops industry. Now United Malacca can target international markets with far fewer capital restrictions requirements than the existing system.
Manufacturing automation
– United Malacca can use the latest technology developments to improve its manufacturing and designing process in Crops 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.
Developing new processes and practices
– United Malacca can develop new processes and procedures in Crops 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, United Malacca can use these opportunities to build new business models that can help the communities that United Malacca operates in. Secondly it can use opportunities from government spending in Crops sector.
Buying journey improvements
– United Malacca can improve the customer journey of consumers in the Crops 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.
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 United Malacca 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, United Malacca is facing challenges because of the dominance of functional experts in the organization. United Malacca can utilize new technology in the field of Crops industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Leveraging digital technologies
– United Malacca 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.
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. United Malacca can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats United Malacca External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of United Malacca are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Crops industry are lowering. It can presents United Malacca with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Crops 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.
Technology acceleration in Forth Industrial Revolution
– United Malacca has witnessed rapid integration of technology during Covid-19 in the Crops industry. As one of the leading players in the industry, United Malacca needs to keep up with the evolution of technology in the Crops 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.
Easy access to finance
– Easy access to finance in Crops industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. United Malacca can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing wage structure of United Malacca
– 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 United Malacca.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, United Malacca may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Crops sector.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for United Malacca in Crops industry. The Crops 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.
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 United Malacca business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– United Malacca 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 Crops industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, United Malacca 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 United Malacca prominent markets.
High dependence on third party suppliers
– United Malacca 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.
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 United Malacca.
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 United Malacca in the Crops sector and impact the bottomline of the organization.
Weighted SWOT Analysis of United Malacca Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at United Malacca 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 United Malacca 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 United Malacca 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 United Malacca 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 United Malacca needs to make to build a sustainable competitive advantage.
