Avic International Maritime (AVIC) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Avic International Maritime (Singapore)

Based on various researches at Oak Spring University , Avic International Maritime is operating in a macro-environment that has been destablized by – customer relationship management is fast transforming because of increasing concerns over data privacy, banking and financial system is disrupted by Bitcoin and other crypto currencies, technology disruption, challanges to central banks by blockchain based private currencies, increasing commodity prices, digital marketing is dominated by two big players Facebook and Google, increasing energy prices, wage bills are increasing, there is backlash against globalization, etc

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Introduction to SWOT Analysis of Avic International Maritime

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Avic International Maritime can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Avic International Maritime, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Avic International Maritime 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of Avic International Maritime can be done for the following purposes –
1. Strategic planning of Avic International Maritime
2. Improving business portfolio management of Avic International Maritime
3. Assessing feasibility of the new initiative in Singapore
4. Making a Business Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Avic International Maritime

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Strengths of Avic International Maritime | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Avic International Maritime are -

Cross disciplinary teams

– Horizontal connected teams at the Avic International Maritime 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.

Strong track record of project management in the Business Services industry

– Avic International Maritime is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

High brand equity

– Avic International Maritime has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Avic International Maritime to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Diverse revenue streams

– Avic International Maritime is present in almost all the verticals within the Business Services industry. This has provided Avic International Maritime 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 Avic International Maritime in Business Services industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Innovation driven organization

– Avic International Maritime is one of the most innovative firm in Business Services sector.

Analytics focus

– Avic International Maritime 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 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.

Successful track record of launching new products

– Avic International Maritime has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Avic International Maritime 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)

– Avic International Maritime has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Avic International Maritime 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.

Ability to lead change in Business Services

– Avic International Maritime is one of the leading players in the Business Services industry in Singapore. Over the years it has not only transformed the business landscape in the Business Services industry in Singapore but also across the existing markets. The ability to lead change has enabled Avic International Maritime in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

Sustainable margins compare to other players in Business Services industry

– Avic International Maritime has clearly differentiated products in the market place. This has enabled Avic International Maritime to fetch slight price premium compare to the competitors in the Business Services industry. The sustainable margins have also helped Avic International Maritime to invest into research and development (R&D) and innovation.

Digital Transformation in Business Services industry

- digital transformation varies from industry to industry. For Avic International Maritime digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Avic International Maritime 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.

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Weaknesses of Avic International Maritime | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Avic International Maritime are -

Need for greater diversity

– Avic International Maritime 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.

Interest costs

– Compare to the competition, Avic International Maritime 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.

High dependence on Avic International Maritime ‘s star products

– The top 2 products and services of Avic International Maritime still accounts for major business revenue. This dependence on star products in Business Services industry has resulted into insufficient focus on developing new products, even though Avic International Maritime has relatively successful track record of launching new products.

No frontier risks strategy

– From the 10K / annual statement of Avic International Maritime, it seems that company is thinking out the frontier risks that can impact Business 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.

Increasing silos among functional specialists

– The organizational structure of Avic International Maritime is dominated by functional specialists. It is not different from other players in the Business Services industry, but Avic International Maritime needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Avic International Maritime to focus more on services in the Business Services industry rather than just following the product oriented approach.

Slow decision making process

– As mentioned earlier in the report, Avic International Maritime has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Business Services industry over the last five years. Avic International Maritime 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.

High cash cycle compare to competitors

Avic International Maritime 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.

Ability to respond to the competition

– As the decision making is very deliberative at Avic International Maritime, in the dynamic environment of Business Services industry it has struggled to respond to the nimble upstart competition. Avic International Maritime has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

Employees’ less understanding of Avic International Maritime strategy

– From the outside it seems that the employees of Avic International Maritime 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.

Aligning sales with marketing

– From the outside it seems that Avic International Maritime 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 Avic International Maritime can leverage the sales team experience to cultivate customer relationships as Avic International Maritime is planning to shift buying processes online.

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Avic International Maritime is slow explore the new channels of communication. These new channels of communication can help Avic International Maritime to provide better information regarding Business Services products and services. It can also build an online community to further reach out to potential customers.

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Avic International Maritime Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of Avic International Maritime are -

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects Avic International Maritime can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

Building a culture of innovation

– managers at Avic International Maritime 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. Avic International Maritime can explore opportunities that can attract volunteers and are consistent with its mission and vision.

Developing new processes and practices

– Avic International Maritime can develop new processes and procedures in Business 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.

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 Avic International Maritime 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.

Manufacturing automation

– Avic International Maritime 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.

Learning at scale

– Online learning technologies has now opened space for Avic International Maritime 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.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Avic International Maritime 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 Avic International Maritime to hire the very best people irrespective of their geographical location.

Better consumer reach

– The expansion of the 5G network will help Avic International Maritime to increase its market reach. Avic International Maritime 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.

Redefining models of collaboration and team work

– As explained in the weaknesses section, Avic International Maritime is facing challenges because of the dominance of functional experts in the organization. Avic International Maritime can utilize new technology in the field of Business Services industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.

Loyalty marketing

– Avic International Maritime 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.

Buying journey improvements

– Avic International Maritime 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.

Creating value in data economy

– The success of analytics program of Avic International Maritime has opened avenues for new revenue streams for the organization in Business Services industry. This can help Avic International Maritime to build a more holistic ecosystem for Avic International Maritime products in the Business Services industry by providing – data insight services, data privacy related products, data based consulting services, etc.

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Threats Avic International Maritime External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of Avic International Maritime are -

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, Avic International Maritime 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 Avic International Maritime prominent markets.

Technology disruption because of hacks, piracy etc

– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.

High dependence on third party suppliers

– Avic International Maritime 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.

Environmental challenges

– Avic International Maritime 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. Avic International Maritime can take advantage of this fund but it will also bring new competitors in the Business Services industry.

Stagnating economy with rate increase

– Avic International Maritime 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.

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. Avic International Maritime can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.

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 Avic International Maritime.

Increasing wage structure of Avic International Maritime

– 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 Avic International Maritime.

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. Avic International Maritime needs to understand the core reasons impacting the Business Services industry. This will help it in building a better workplace.

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.

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, Avic International Maritime 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.

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 Avic International Maritime in the Business Services sector and impact the bottomline of the organization.

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 Avic International Maritime business can come under increasing regulations regarding data privacy, data security, etc.

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Weighted SWOT Analysis of Avic International Maritime Template, Example

Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Avic International Maritime 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 Avic International Maritime 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 Avic International Maritime 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 Avic International Maritime 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 Avic International Maritime needs to make to build a sustainable competitive advantage.

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