ComfortDelGro (CMDG) SWOT Analysis / TOWS Matrix / MBA Resources
Misc. Transportation
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for ComfortDelGro (Singapore)
Based on various researches at Oak Spring University , ComfortDelGro is operating in a macro-environment that has been destablized by – talent flight as more people leaving formal jobs, there is backlash against globalization, technology disruption, increasing commodity prices, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing household debt because of falling income levels, increasing energy prices,
geopolitical disruptions, competitive advantages are harder to sustain because of technology dispersion, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that ComfortDelGro can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the ComfortDelGro, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which ComfortDelGro 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 ComfortDelGro can be done for the following purposes –
1. Strategic planning of ComfortDelGro
2. Improving business portfolio management of ComfortDelGro
3. Assessing feasibility of the new initiative in Singapore
4. Making a Misc. Transportation sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of ComfortDelGro
Strengths of ComfortDelGro | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of ComfortDelGro are -
Digital Transformation in Misc. Transportation industry
- digital transformation varies from industry to industry. For ComfortDelGro digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. ComfortDelGro 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
– ComfortDelGro is one of the leading players in the Misc. Transportation industry in Singapore. It is in a position to attract the best talent available in Singapore. The firm has a robust talent identification program that helps in identifying the brightest.
Cross disciplinary teams
– Horizontal connected teams at the ComfortDelGro 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.
Organizational Resilience of ComfortDelGro
– The covid-19 pandemic has put organizational resilience at the centre of everthing ComfortDelGro does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Diverse revenue streams
– ComfortDelGro is present in almost all the verticals within the Misc. Transportation industry. This has provided ComfortDelGro 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 ComfortDelGro in Misc. Transportation industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Strong track record of project management in the Misc. Transportation industry
– ComfortDelGro is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Low bargaining power of suppliers
– Suppliers of ComfortDelGro in the Transportation sector have low bargaining power. ComfortDelGro has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps ComfortDelGro to manage not only supply disruptions but also source products at highly competitive prices.
High brand equity
– ComfortDelGro has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled ComfortDelGro to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Training and development
– ComfortDelGro has one of the best training and development program in Transportation 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.
Operational resilience
– The operational resilience strategy of ComfortDelGro comprises – understanding the underlying the factors in the Misc. Transportation 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.
Analytics focus
– ComfortDelGro 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 Misc. Transportation industry. The technology infrastructure of Singapore 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 ComfortDelGro | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of ComfortDelGro are -
Aligning sales with marketing
– From the outside it seems that ComfortDelGro needs to have more collaboration between its sales team and marketing team. Sales professionals in the Misc. Transportation industry have deep experience in developing customer relationships. Marketing department at ComfortDelGro can leverage the sales team experience to cultivate customer relationships as ComfortDelGro is planning to shift buying processes online.
High bargaining power of channel partners in Misc. Transportation industry
– because of the regulatory requirements in Singapore, ComfortDelGro 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 Misc. Transportation industry.
Low market penetration in new markets
– Outside its home market of Singapore, ComfortDelGro needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Increasing silos among functional specialists
– The organizational structure of ComfortDelGro is dominated by functional specialists. It is not different from other players in the Misc. Transportation industry, but ComfortDelGro needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help ComfortDelGro to focus more on services in the Misc. Transportation industry rather than just following the product oriented approach.
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 ComfortDelGro supply chain. Even after few cautionary changes, ComfortDelGro is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left ComfortDelGro vulnerable to further global disruptions in South East Asia.
High operating costs
– Compare to the competitors, ComfortDelGro has high operating costs in the Misc. Transportation industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract ComfortDelGro lucrative customers.
No frontier risks strategy
– From the 10K / annual statement of ComfortDelGro, it seems that company is thinking out the frontier risks that can impact Misc. Transportation 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.
Slow decision making process
– As mentioned earlier in the report, ComfortDelGro has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Misc. Transportation industry over the last five years. ComfortDelGro 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.
Workers concerns about automation
– As automation is fast increasing in the Misc. Transportation industry, ComfortDelGro 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.
Skills based hiring in Misc. Transportation industry
– The stress on hiring functional specialists at ComfortDelGro 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, ComfortDelGro is slow explore the new channels of communication. These new channels of communication can help ComfortDelGro to provide better information regarding Misc. Transportation products and services. It can also build an online community to further reach out to potential customers.
ComfortDelGro Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of ComfortDelGro are -
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, ComfortDelGro can use these opportunities to build new business models that can help the communities that ComfortDelGro operates in. Secondly it can use opportunities from government spending in Misc. Transportation sector.
Better consumer reach
– The expansion of the 5G network will help ComfortDelGro to increase its market reach. ComfortDelGro 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Misc. Transportation industry, but it has also influenced the consumer preferences. ComfortDelGro 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, ComfortDelGro 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
– ComfortDelGro has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Misc. Transportation sector. This continuous investment in analytics has enabled ComfortDelGro to build a competitive advantage using analytics. The analytics driven competitive advantage can help ComfortDelGro to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Developing new processes and practices
– ComfortDelGro can develop new processes and procedures in Misc. Transportation 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects ComfortDelGro can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. ComfortDelGro can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Manufacturing automation
– ComfortDelGro can use the latest technology developments to improve its manufacturing and designing process in Misc. Transportation 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for ComfortDelGro 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 ComfortDelGro to hire the very best people irrespective of their geographical location.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Misc. Transportation industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. ComfortDelGro 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. ComfortDelGro 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.
Creating value in data economy
– The success of analytics program of ComfortDelGro has opened avenues for new revenue streams for the organization in Misc. Transportation industry. This can help ComfortDelGro to build a more holistic ecosystem for ComfortDelGro products in the Misc. Transportation industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for ComfortDelGro in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Misc. Transportation industry, and it will provide faster access to the consumers.
Threats ComfortDelGro External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of ComfortDelGro are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, ComfortDelGro may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Misc. Transportation sector.
Stagnating economy with rate increase
– ComfortDelGro 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 Misc. Transportation industry.
Easy access to finance
– Easy access to finance in Misc. Transportation industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. ComfortDelGro can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Technology acceleration in Forth Industrial Revolution
– ComfortDelGro has witnessed rapid integration of technology during Covid-19 in the Misc. Transportation industry. As one of the leading players in the industry, ComfortDelGro needs to keep up with the evolution of technology in the Misc. Transportation 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.
Regulatory challenges
– ComfortDelGro 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 Misc. Transportation industry regulations.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for ComfortDelGro in Misc. Transportation industry. The Misc. Transportation 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.
High dependence on third party suppliers
– ComfortDelGro 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.
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.
Increasing wage structure of ComfortDelGro
– 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 ComfortDelGro.
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 ComfortDelGro business can come under increasing regulations regarding data privacy, data security, etc.
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. ComfortDelGro 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, ComfortDelGro 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 ComfortDelGro prominent markets.
Consumer confidence and its impact on ComfortDelGro 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 Misc. Transportation industry and other sectors.
Weighted SWOT Analysis of ComfortDelGro Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at ComfortDelGro 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 ComfortDelGro 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 ComfortDelGro 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 ComfortDelGro 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 ComfortDelGro needs to make to build a sustainable competitive advantage.