SWOT Analysis / TOWS Matrix for CosmoSteel Holdings Ltd (Singapore)
Based on various researches at Oak Spring University , CosmoSteel Holdings Ltd is operating in a macro-environment that has been destablized by – cloud computing is disrupting traditional business models, wage bills are increasing, increasing energy prices, technology disruption, competitive advantages are harder to sustain because of technology dispersion, talent flight as more people leaving formal jobs, digital marketing is dominated by two big players Facebook and Google,
there is increasing trade war between United States & China, there is backlash against globalization, etc
Introduction to SWOT Analysis of CosmoSteel Holdings Ltd
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that CosmoSteel Holdings Ltd can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the CosmoSteel Holdings Ltd, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which CosmoSteel Holdings Ltd 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 CosmoSteel Holdings Ltd can be done for the following purposes –
1. Strategic planning of CosmoSteel Holdings Ltd
2. Improving business portfolio management of CosmoSteel Holdings Ltd
3. Assessing feasibility of the new initiative in Singapore
4. Making a Misc. Fabricated Products sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of CosmoSteel Holdings Ltd
Strengths of CosmoSteel Holdings Ltd | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of CosmoSteel Holdings Ltd are -
Ability to lead change in Misc. Fabricated Products
– CosmoSteel Holdings Ltd is one of the leading players in the Misc. Fabricated Products industry in Singapore. Over the years it has not only transformed the business landscape in the Misc. Fabricated Products industry in Singapore but also across the existing markets. The ability to lead change has enabled CosmoSteel Holdings Ltd in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Effective Research and Development (R&D)
– CosmoSteel Holdings Ltd has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – CosmoSteel Holdings Ltd staying ahead in the Misc. Fabricated Products industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Superior customer experience
– The customer experience strategy of CosmoSteel Holdings Ltd in Misc. Fabricated Products industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– CosmoSteel Holdings Ltd has one of the best training and development program in Basic Materials 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.
Organizational Resilience of CosmoSteel Holdings Ltd
– The covid-19 pandemic has put organizational resilience at the centre of everthing CosmoSteel Holdings Ltd does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High switching costs
– The high switching costs that CosmoSteel Holdings Ltd 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.
Learning organization
- CosmoSteel Holdings Ltd 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 CosmoSteel Holdings Ltd is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at CosmoSteel Holdings Ltd emphasize – knowledge, initiative, and innovation.
High brand equity
– CosmoSteel Holdings Ltd has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled CosmoSteel Holdings Ltd to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of CosmoSteel Holdings Ltd in the Basic Materials sector have low bargaining power. CosmoSteel Holdings Ltd has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps CosmoSteel Holdings Ltd to manage not only supply disruptions but also source products at highly competitive prices.
Innovation driven organization
– CosmoSteel Holdings Ltd is one of the most innovative firm in Misc. Fabricated Products sector.
Cross disciplinary teams
– Horizontal connected teams at the CosmoSteel Holdings Ltd 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.
Operational resilience
– The operational resilience strategy of CosmoSteel Holdings Ltd comprises – understanding the underlying the factors in the Misc. Fabricated Products 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.
Weaknesses of CosmoSteel Holdings Ltd | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of CosmoSteel Holdings Ltd 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 CosmoSteel Holdings Ltd supply chain. Even after few cautionary changes, CosmoSteel Holdings Ltd is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left CosmoSteel Holdings Ltd vulnerable to further global disruptions in South East Asia.
High cash cycle compare to competitors
CosmoSteel Holdings Ltd has a high cash cycle compare to other players in the Misc. Fabricated Products industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Low market penetration in new markets
– Outside its home market of Singapore, CosmoSteel Holdings Ltd needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Skills based hiring in Misc. Fabricated Products industry
– The stress on hiring functional specialists at CosmoSteel Holdings Ltd 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.
Interest costs
– Compare to the competition, CosmoSteel Holdings Ltd 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 CosmoSteel Holdings Ltd ‘s star products
– The top 2 products and services of CosmoSteel Holdings Ltd still accounts for major business revenue. This dependence on star products in Misc. Fabricated Products industry has resulted into insufficient focus on developing new products, even though CosmoSteel Holdings Ltd has relatively successful track record of launching new products.
Increasing silos among functional specialists
– The organizational structure of CosmoSteel Holdings Ltd is dominated by functional specialists. It is not different from other players in the Misc. Fabricated Products industry, but CosmoSteel Holdings Ltd needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help CosmoSteel Holdings Ltd to focus more on services in the Misc. Fabricated Products industry rather than just following the product oriented approach.
Ability to respond to the competition
– As the decision making is very deliberative at CosmoSteel Holdings Ltd, in the dynamic environment of Misc. Fabricated Products industry it has struggled to respond to the nimble upstart competition. CosmoSteel Holdings Ltd has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Compensation and incentives
– The revenue per employee of CosmoSteel Holdings Ltd is just above the Misc. Fabricated Products 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.
Need for greater diversity
– CosmoSteel Holdings Ltd 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.
High bargaining power of channel partners in Misc. Fabricated Products industry
– because of the regulatory requirements in Singapore, CosmoSteel Holdings Ltd 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. Fabricated Products industry.
CosmoSteel Holdings Ltd Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of CosmoSteel Holdings Ltd are -
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Misc. Fabricated Products industry, but it has also influenced the consumer preferences. CosmoSteel Holdings Ltd can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Leveraging digital technologies
– CosmoSteel Holdings Ltd 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.
Building a culture of innovation
– managers at CosmoSteel Holdings Ltd 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 Misc. Fabricated Products industry.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, CosmoSteel Holdings Ltd can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help CosmoSteel Holdings Ltd to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, CosmoSteel Holdings Ltd can use these opportunities to build new business models that can help the communities that CosmoSteel Holdings Ltd operates in. Secondly it can use opportunities from government spending in Misc. Fabricated Products sector.
Redefining models of collaboration and team work
– As explained in the weaknesses section, CosmoSteel Holdings Ltd is facing challenges because of the dominance of functional experts in the organization. CosmoSteel Holdings Ltd can utilize new technology in the field of Misc. Fabricated Products industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Use of Bitcoin and other crypto currencies for transactions in Misc. Fabricated Products industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for CosmoSteel Holdings Ltd in the Misc. Fabricated Products industry. Now CosmoSteel Holdings Ltd can target international markets with far fewer capital restrictions requirements than the existing system.
Lowering marketing communication costs
– 5G expansion will open new opportunities for CosmoSteel Holdings Ltd 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. Fabricated Products industry, and it will provide faster access to the consumers.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for CosmoSteel Holdings Ltd 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 CosmoSteel Holdings Ltd to hire the very best people irrespective of their geographical location.
Low interest rates
– Even though inflation is raising its head in most developed economies, CosmoSteel Holdings Ltd 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.
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. CosmoSteel Holdings Ltd can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Creating value in data economy
– The success of analytics program of CosmoSteel Holdings Ltd has opened avenues for new revenue streams for the organization in Misc. Fabricated Products industry. This can help CosmoSteel Holdings Ltd to build a more holistic ecosystem for CosmoSteel Holdings Ltd products in the Misc. Fabricated Products industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Loyalty marketing
– CosmoSteel Holdings Ltd 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.
Threats CosmoSteel Holdings Ltd External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of CosmoSteel Holdings Ltd are -
Regulatory challenges
– CosmoSteel Holdings Ltd 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. Fabricated Products industry regulations.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, CosmoSteel Holdings Ltd 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 CosmoSteel Holdings Ltd prominent markets.
Consumer confidence and its impact on CosmoSteel Holdings Ltd 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. Fabricated Products industry and other sectors.
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 CosmoSteel Holdings Ltd.
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 CosmoSteel Holdings Ltd business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– CosmoSteel Holdings Ltd 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.
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 CosmoSteel Holdings Ltd in the Misc. Fabricated Products sector and impact the bottomline of the organization.
Easy access to finance
– Easy access to finance in Misc. Fabricated Products industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. CosmoSteel Holdings Ltd 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
– CosmoSteel Holdings Ltd has witnessed rapid integration of technology during Covid-19 in the Misc. Fabricated Products industry. As one of the leading players in the industry, CosmoSteel Holdings Ltd needs to keep up with the evolution of technology in the Misc. Fabricated Products 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, CosmoSteel Holdings Ltd 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. Fabricated Products sector.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Misc. Fabricated Products industry are lowering. It can presents CosmoSteel Holdings Ltd with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Misc. Fabricated Products 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.
Weighted SWOT Analysis of CosmoSteel Holdings Ltd Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at CosmoSteel Holdings Ltd 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 CosmoSteel Holdings Ltd 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 CosmoSteel Holdings Ltd 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 CosmoSteel Holdings Ltd 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 CosmoSteel Holdings Ltd needs to make to build a sustainable competitive advantage.