SWOT Analysis / TOWS Matrix for Cargo Carriers Ltd (South Africa)
Based on various researches at Oak Spring University , Cargo Carriers Ltd is operating in a macro-environment that has been destablized by – increasing household debt because of falling income levels, technology disruption, there is increasing trade war between United States & China, central banks are concerned over increasing inflation, increasing commodity prices, supply chains are disrupted by pandemic , challanges to central banks by blockchain based private currencies,
wage bills are increasing, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of Cargo Carriers Ltd
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Cargo Carriers Ltd can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Cargo Carriers Ltd, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Cargo Carriers 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 Cargo Carriers Ltd can be done for the following purposes –
1. Strategic planning of Cargo Carriers Ltd
2. Improving business portfolio management of Cargo Carriers Ltd
3. Assessing feasibility of the new initiative in South Africa
4. Making a Trucking sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Cargo Carriers Ltd
Strengths of Cargo Carriers Ltd | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Cargo Carriers Ltd are -
Highly skilled collaborators
– Cargo Carriers Ltd has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Trucking industry. Secondly the value chain collaborators of Cargo Carriers Ltd have helped the firm to develop new products and bring them quickly to the marketplace.
Operational resilience
– The operational resilience strategy of Cargo Carriers Ltd comprises – understanding the underlying the factors in the Trucking 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.
Sustainable margins compare to other players in Trucking industry
– Cargo Carriers Ltd has clearly differentiated products in the market place. This has enabled Cargo Carriers Ltd to fetch slight price premium compare to the competitors in the Trucking industry. The sustainable margins have also helped Cargo Carriers Ltd to invest into research and development (R&D) and innovation.
Ability to recruit top talent
– Cargo Carriers Ltd is one of the leading players in the Trucking 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.
Organizational Resilience of Cargo Carriers Ltd
– The covid-19 pandemic has put organizational resilience at the centre of everthing Cargo Carriers Ltd does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Diverse revenue streams
– Cargo Carriers Ltd is present in almost all the verticals within the Trucking industry. This has provided Cargo Carriers Ltd 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.
Analytics focus
– Cargo Carriers Ltd 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 Trucking 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.
Strong track record of project management in the Trucking industry
– Cargo Carriers Ltd is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to lead change in Trucking
– Cargo Carriers Ltd is one of the leading players in the Trucking industry in South Africa. Over the years it has not only transformed the business landscape in the Trucking industry in South Africa but also across the existing markets. The ability to lead change has enabled Cargo Carriers Ltd in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Learning organization
- Cargo Carriers 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 Cargo Carriers Ltd is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Cargo Carriers Ltd emphasize – knowledge, initiative, and innovation.
Training and development
– Cargo Carriers Ltd 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.
Successful track record of launching new products
– Cargo Carriers Ltd has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Cargo Carriers Ltd 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.
Weaknesses of Cargo Carriers Ltd | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Cargo Carriers Ltd are -
Capital Spending Reduction
– Even during the low interest decade, Cargo Carriers Ltd 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 Trucking industry using digital technology.
Increasing silos among functional specialists
– The organizational structure of Cargo Carriers Ltd is dominated by functional specialists. It is not different from other players in the Trucking industry, but Cargo Carriers Ltd needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Cargo Carriers Ltd to focus more on services in the Trucking industry rather than just following the product oriented approach.
Employees’ less understanding of Cargo Carriers Ltd strategy
– From the outside it seems that the employees of Cargo Carriers Ltd 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.
No frontier risks strategy
– From the 10K / annual statement of Cargo Carriers Ltd, it seems that company is thinking out the frontier risks that can impact Trucking 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.
Skills based hiring in Trucking industry
– The stress on hiring functional specialists at Cargo Carriers 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Cargo Carriers Ltd is slow explore the new channels of communication. These new channels of communication can help Cargo Carriers Ltd to provide better information regarding Trucking products and services. It can also build an online community to further reach out to potential customers.
Slow to strategic competitive environment developments
– As Cargo Carriers Ltd is one of the leading players in the Trucking industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Trucking industry in last five years.
Ability to respond to the competition
– As the decision making is very deliberative at Cargo Carriers Ltd, in the dynamic environment of Trucking industry it has struggled to respond to the nimble upstart competition. Cargo Carriers Ltd has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High dependence on Cargo Carriers Ltd ‘s star products
– The top 2 products and services of Cargo Carriers Ltd still accounts for major business revenue. This dependence on star products in Trucking industry has resulted into insufficient focus on developing new products, even though Cargo Carriers Ltd has relatively successful track record of launching new products.
Lack of clear differentiation of Cargo Carriers Ltd products
– To increase the profitability and margins on the products, Cargo Carriers Ltd needs to provide more differentiated products than what it is currently offering in the marketplace.
Compensation and incentives
– The revenue per employee of Cargo Carriers Ltd is just above the Trucking 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.
Cargo Carriers Ltd Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Cargo Carriers Ltd are -
Manufacturing automation
– Cargo Carriers Ltd can use the latest technology developments to improve its manufacturing and designing process in Trucking 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.
Leveraging digital technologies
– Cargo Carriers 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Cargo Carriers 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Trucking industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Cargo Carriers Ltd 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. Cargo Carriers Ltd 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.
Buying journey improvements
– Cargo Carriers Ltd can improve the customer journey of consumers in the Trucking 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.
Better consumer reach
– The expansion of the 5G network will help Cargo Carriers Ltd to increase its market reach. Cargo Carriers Ltd 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.
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 Cargo Carriers Ltd 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.
Learning at scale
– Online learning technologies has now opened space for Cargo Carriers Ltd 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 Cargo Carriers 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 Cargo Carriers Ltd to hire the very best people irrespective of their geographical location.
Loyalty marketing
– Cargo Carriers 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Cargo Carriers Ltd is facing challenges because of the dominance of functional experts in the organization. Cargo Carriers Ltd can utilize new technology in the field of Trucking industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Cargo Carriers 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 Trucking industry, and it will provide faster access to the consumers.
Building a culture of innovation
– managers at Cargo Carriers 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 Trucking industry.
Threats Cargo Carriers Ltd External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Cargo Carriers Ltd are -
Shortening product life cycle
– it is one of the major threat that Cargo Carriers Ltd is facing in Trucking sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Trucking industry are lowering. It can presents Cargo Carriers Ltd with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Trucking sector.
Stagnating economy with rate increase
– Cargo Carriers Ltd 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 Trucking industry.
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 Cargo Carriers Ltd business can come under increasing regulations regarding data privacy, data security, etc.
Increasing wage structure of Cargo Carriers Ltd
– 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 Cargo Carriers Ltd.
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. Cargo Carriers Ltd 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.
Easy access to finance
– Easy access to finance in Trucking industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Cargo Carriers Ltd 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 Cargo Carriers Ltd.
High dependence on third party suppliers
– Cargo Carriers 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.
Environmental challenges
– Cargo Carriers Ltd 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. Cargo Carriers Ltd can take advantage of this fund but it will also bring new competitors in the Trucking industry.
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, Cargo Carriers 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 Trucking sector.
Consumer confidence and its impact on Cargo Carriers 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 Trucking industry and other sectors.
Weighted SWOT Analysis of Cargo Carriers Ltd Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Cargo Carriers 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 Cargo Carriers 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 Cargo Carriers 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 Cargo Carriers 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 Cargo Carriers Ltd needs to make to build a sustainable competitive advantage.