SWOT Analysis / TOWS Matrix for Silver Ridge (Malaysia)
Based on various researches at Oak Spring University , Silver Ridge is operating in a macro-environment that has been destablized by – challanges to central banks by blockchain based private currencies, talent flight as more people leaving formal jobs, increasing energy prices, digital marketing is dominated by two big players Facebook and Google, increasing transportation and logistics costs, wage bills are increasing, cloud computing is disrupting traditional business models,
increasing commodity prices, increasing government debt because of Covid-19 spendings, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Silver Ridge can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Silver Ridge, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Silver Ridge 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 Silver Ridge can be done for the following purposes –
1. Strategic planning of Silver Ridge
2. Improving business portfolio management of Silver Ridge
3. Assessing feasibility of the new initiative in Malaysia
4. Making a Software & Programming sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Silver Ridge
Strengths of Silver Ridge | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Silver Ridge are -
Innovation driven organization
– Silver Ridge is one of the most innovative firm in Software & Programming sector.
Superior customer experience
– The customer experience strategy of Silver Ridge in Software & Programming industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Effective Research and Development (R&D)
– Silver Ridge has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Silver Ridge staying ahead in the Software & Programming industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Organizational Resilience of Silver Ridge
– The covid-19 pandemic has put organizational resilience at the centre of everthing Silver Ridge does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Digital Transformation in Software & Programming industry
- digital transformation varies from industry to industry. For Silver Ridge digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Silver Ridge 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.
Successful track record of launching new products
– Silver Ridge has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Silver Ridge 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.
High brand equity
– Silver Ridge has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Silver Ridge to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to recruit top talent
– Silver Ridge is one of the leading players in the Software & Programming 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.
Sustainable margins compare to other players in Software & Programming industry
– Silver Ridge has clearly differentiated products in the market place. This has enabled Silver Ridge to fetch slight price premium compare to the competitors in the Software & Programming industry. The sustainable margins have also helped Silver Ridge to invest into research and development (R&D) and innovation.
Learning organization
- Silver Ridge 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 Silver Ridge is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Silver Ridge emphasize – knowledge, initiative, and innovation.
Operational resilience
– The operational resilience strategy of Silver Ridge comprises – understanding the underlying the factors in the Software & Programming 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.
Cross disciplinary teams
– Horizontal connected teams at the Silver Ridge 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.
Weaknesses of Silver Ridge | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Silver Ridge are -
Slow to strategic competitive environment developments
– As Silver Ridge is one of the leading players in the Software & Programming industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Software & Programming industry in last five years.
Capital Spending Reduction
– Even during the low interest decade, Silver Ridge 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 Software & Programming industry using digital technology.
Products dominated business model
– Even though Silver Ridge has some of the most successful models in the Software & Programming industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Silver Ridge should strive to include more intangible value offerings along with its core products and services.
High operating costs
– Compare to the competitors, Silver Ridge has high operating costs in the Software & Programming industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Silver Ridge lucrative customers.
Low market penetration in new markets
– Outside its home market of Malaysia, Silver Ridge needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Employees’ less understanding of Silver Ridge strategy
– From the outside it seems that the employees of Silver Ridge 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.
Compensation and incentives
– The revenue per employee of Silver Ridge is just above the Software & Programming 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.
High dependence on Silver Ridge ‘s star products
– The top 2 products and services of Silver Ridge still accounts for major business revenue. This dependence on star products in Software & Programming industry has resulted into insufficient focus on developing new products, even though Silver Ridge has relatively successful track record of launching new products.
High cash cycle compare to competitors
Silver Ridge has a high cash cycle compare to other players in the Software & Programming industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
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 Silver Ridge supply chain. Even after few cautionary changes, Silver Ridge is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Silver Ridge vulnerable to further global disruptions in South East Asia.
Ability to respond to the competition
– As the decision making is very deliberative at Silver Ridge, in the dynamic environment of Software & Programming industry it has struggled to respond to the nimble upstart competition. Silver Ridge has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Silver Ridge Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Silver Ridge 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 Silver Ridge 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Silver Ridge 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 Silver Ridge to hire the very best people irrespective of their geographical location.
Building a culture of innovation
– managers at Silver Ridge 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 Software & Programming industry.
Better consumer reach
– The expansion of the 5G network will help Silver Ridge to increase its market reach. Silver Ridge 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Silver Ridge in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Software & Programming industry, and it will provide faster access to the consumers.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Silver Ridge is facing challenges because of the dominance of functional experts in the organization. Silver Ridge can utilize new technology in the field of Software & Programming industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Leveraging digital technologies
– Silver Ridge 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.
Loyalty marketing
– Silver Ridge 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Software & Programming industry, but it has also influenced the consumer preferences. Silver Ridge can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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. Silver Ridge 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 Silver Ridge can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Using analytics as competitive advantage
– Silver Ridge has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Software & Programming sector. This continuous investment in analytics has enabled Silver Ridge to build a competitive advantage using analytics. The analytics driven competitive advantage can help Silver Ridge to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Creating value in data economy
– The success of analytics program of Silver Ridge has opened avenues for new revenue streams for the organization in Software & Programming industry. This can help Silver Ridge to build a more holistic ecosystem for Silver Ridge products in the Software & Programming industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Threats Silver Ridge External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Silver Ridge are -
Shortening product life cycle
– it is one of the major threat that Silver Ridge is facing in Software & Programming sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Easy access to finance
– Easy access to finance in Software & Programming industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Silver Ridge can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Environmental challenges
– Silver Ridge 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. Silver Ridge can take advantage of this fund but it will also bring new competitors in the Software & Programming industry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Silver Ridge may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Software & Programming 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.
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. Silver Ridge 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.
Consumer confidence and its impact on Silver Ridge 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 Software & Programming industry and other sectors.
Technology acceleration in Forth Industrial Revolution
– Silver Ridge has witnessed rapid integration of technology during Covid-19 in the Software & Programming industry. As one of the leading players in the industry, Silver Ridge needs to keep up with the evolution of technology in the Software & Programming 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.
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 Silver Ridge.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Software & Programming industry are lowering. It can presents Silver Ridge with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Software & Programming sector.
Regulatory challenges
– Silver Ridge 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 Software & Programming industry regulations.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Silver Ridge in Software & Programming industry. The Software & Programming 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.
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 Silver Ridge in the Software & Programming sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Silver Ridge Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Silver Ridge 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 Silver Ridge 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 Silver Ridge 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 Silver Ridge 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 Silver Ridge needs to make to build a sustainable competitive advantage.