SWOT Analysis / TOWS Matrix for Rand Merchant Inv (South Africa)
Based on various researches at Oak Spring University , Rand Merchant Inv is operating in a macro-environment that has been destablized by – technology disruption, increasing household debt because of falling income levels, increasing commodity prices, there is backlash against globalization, increasing inequality as vast percentage of new income is going to the top 1%, supply chains are disrupted by pandemic , competitive advantages are harder to sustain because of technology dispersion,
geopolitical disruptions, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
Introduction to SWOT Analysis of Rand Merchant Inv
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Rand Merchant Inv can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Rand Merchant Inv, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Rand Merchant Inv 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 Rand Merchant Inv can be done for the following purposes –
1. Strategic planning of Rand Merchant Inv
2. Improving business portfolio management of Rand Merchant Inv
3. Assessing feasibility of the new initiative in South Africa
4. Making a Insurance (Miscellaneous) sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Rand Merchant Inv
Strengths of Rand Merchant Inv | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Rand Merchant Inv are -
Ability to recruit top talent
– Rand Merchant Inv is one of the leading players in the Insurance (Miscellaneous) industry in South Africa. It is in a position to attract the best talent available in South Africa. The firm has a robust talent identification program that helps in identifying the brightest.
High switching costs
– The high switching costs that Rand Merchant Inv 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.
Operational resilience
– The operational resilience strategy of Rand Merchant Inv comprises – understanding the underlying the factors in the Insurance (Miscellaneous) 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.
Highly skilled collaborators
– Rand Merchant Inv has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Insurance (Miscellaneous) industry. Secondly the value chain collaborators of Rand Merchant Inv have helped the firm to develop new products and bring them quickly to the marketplace.
Learning organization
- Rand Merchant Inv 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 Rand Merchant Inv is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Rand Merchant Inv emphasize – knowledge, initiative, and innovation.
Successful track record of launching new products
– Rand Merchant Inv has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Rand Merchant Inv 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)
– Rand Merchant Inv has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Rand Merchant Inv staying ahead in the Insurance (Miscellaneous) industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Digital Transformation in Insurance (Miscellaneous) industry
- digital transformation varies from industry to industry. For Rand Merchant Inv digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Rand Merchant Inv 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.
Sustainable margins compare to other players in Insurance (Miscellaneous) industry
– Rand Merchant Inv has clearly differentiated products in the market place. This has enabled Rand Merchant Inv to fetch slight price premium compare to the competitors in the Insurance (Miscellaneous) industry. The sustainable margins have also helped Rand Merchant Inv to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Rand Merchant Inv 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.
Analytics focus
– Rand Merchant Inv 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 Insurance (Miscellaneous) industry. The technology infrastructure of South Africa 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.
Innovation driven organization
– Rand Merchant Inv is one of the most innovative firm in Insurance (Miscellaneous) sector.
Weaknesses of Rand Merchant Inv | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Rand Merchant Inv are -
Ability to respond to the competition
– As the decision making is very deliberative at Rand Merchant Inv, in the dynamic environment of Insurance (Miscellaneous) industry it has struggled to respond to the nimble upstart competition. Rand Merchant Inv has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Aligning sales with marketing
– From the outside it seems that Rand Merchant Inv needs to have more collaboration between its sales team and marketing team. Sales professionals in the Insurance (Miscellaneous) industry have deep experience in developing customer relationships. Marketing department at Rand Merchant Inv can leverage the sales team experience to cultivate customer relationships as Rand Merchant Inv is planning to shift buying processes online.
Slow to strategic competitive environment developments
– As Rand Merchant Inv is one of the leading players in the Insurance (Miscellaneous) industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Insurance (Miscellaneous) industry in last five years.
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 Rand Merchant Inv supply chain. Even after few cautionary changes, Rand Merchant Inv is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Rand Merchant Inv vulnerable to further global disruptions in South East Asia.
Employees’ less understanding of Rand Merchant Inv strategy
– From the outside it seems that the employees of Rand Merchant Inv 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.
Skills based hiring in Insurance (Miscellaneous) industry
– The stress on hiring functional specialists at Rand Merchant Inv 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.
Capital Spending Reduction
– Even during the low interest decade, Rand Merchant Inv 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 Insurance (Miscellaneous) industry using digital technology.
Interest costs
– Compare to the competition, Rand Merchant Inv 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.
Slow decision making process
– As mentioned earlier in the report, Rand Merchant Inv has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Insurance (Miscellaneous) industry over the last five years. Rand Merchant Inv 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.
Low market penetration in new markets
– Outside its home market of South Africa, Rand Merchant Inv needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
No frontier risks strategy
– From the 10K / annual statement of Rand Merchant Inv, it seems that company is thinking out the frontier risks that can impact Insurance (Miscellaneous) 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.
Rand Merchant Inv Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Rand Merchant Inv are -
Creating value in data economy
– The success of analytics program of Rand Merchant Inv has opened avenues for new revenue streams for the organization in Insurance (Miscellaneous) industry. This can help Rand Merchant Inv to build a more holistic ecosystem for Rand Merchant Inv products in the Insurance (Miscellaneous) industry by providing – data insight services, data privacy related products, data based consulting services, 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 Rand Merchant Inv 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.
Better consumer reach
– The expansion of the 5G network will help Rand Merchant Inv to increase its market reach. Rand Merchant Inv 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Rand Merchant Inv 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Rand Merchant Inv 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 Rand Merchant Inv to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Using analytics as competitive advantage
– Rand Merchant Inv has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Insurance (Miscellaneous) sector. This continuous investment in analytics has enabled Rand Merchant Inv to build a competitive advantage using analytics. The analytics driven competitive advantage can help Rand Merchant Inv to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Rand Merchant Inv is facing challenges because of the dominance of functional experts in the organization. Rand Merchant Inv can utilize new technology in the field of Insurance (Miscellaneous) industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Developing new processes and practices
– Rand Merchant Inv can develop new processes and procedures in Insurance (Miscellaneous) 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.
Loyalty marketing
– Rand Merchant Inv 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.
Use of Bitcoin and other crypto currencies for transactions in Insurance (Miscellaneous) industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Rand Merchant Inv in the Insurance (Miscellaneous) industry. Now Rand Merchant Inv can target international markets with far fewer capital restrictions requirements than the existing system.
Learning at scale
– Online learning technologies has now opened space for Rand Merchant Inv 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Insurance (Miscellaneous) industry, but it has also influenced the consumer preferences. Rand Merchant Inv can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Rand Merchant Inv can use these opportunities to build new business models that can help the communities that Rand Merchant Inv operates in. Secondly it can use opportunities from government spending in Insurance (Miscellaneous) sector.
Threats Rand Merchant Inv External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Rand Merchant Inv are -
Stagnating economy with rate increase
– Rand Merchant Inv 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 Insurance (Miscellaneous) industry.
Easy access to finance
– Easy access to finance in Insurance (Miscellaneous) industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Rand Merchant Inv 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
– Rand Merchant Inv has witnessed rapid integration of technology during Covid-19 in the Insurance (Miscellaneous) industry. As one of the leading players in the industry, Rand Merchant Inv needs to keep up with the evolution of technology in the Insurance (Miscellaneous) 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.
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 Rand Merchant Inv business can come under increasing regulations regarding data privacy, data security, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Rand Merchant Inv in Insurance (Miscellaneous) industry. The Insurance (Miscellaneous) 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.
Regulatory challenges
– Rand Merchant Inv 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 Insurance (Miscellaneous) industry regulations.
Shortening product life cycle
– it is one of the major threat that Rand Merchant Inv is facing in Insurance (Miscellaneous) sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Consumer confidence and its impact on Rand Merchant Inv 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 Insurance (Miscellaneous) industry and other sectors.
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. Rand Merchant Inv 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Rand Merchant Inv may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Insurance (Miscellaneous) sector.
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. Rand Merchant Inv needs to understand the core reasons impacting the Insurance (Miscellaneous) industry. This will help it in building a better workplace.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Insurance (Miscellaneous) industry are lowering. It can presents Rand Merchant Inv with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Insurance (Miscellaneous) 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.
Weighted SWOT Analysis of Rand Merchant Inv Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Rand Merchant Inv 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 Rand Merchant Inv 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 Rand Merchant Inv 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 Rand Merchant Inv 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 Rand Merchant Inv needs to make to build a sustainable competitive advantage.
