AJ Networks Co Ltd (95570) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for AJ Networks Co Ltd (South Korea)

Based on various researches at Oak Spring University , AJ Networks Co Ltd is operating in a macro-environment that has been destablized by – cloud computing is disrupting traditional business models, central banks are concerned over increasing inflation, geopolitical disruptions, increasing commodity prices, competitive advantages are harder to sustain because of technology dispersion, customer relationship management is fast transforming because of increasing concerns over data privacy, there is backlash against globalization, there is increasing trade war between United States & China, supply chains are disrupted by pandemic , etc

---

---

---

---

Introduction to SWOT Analysis of AJ Networks Co Ltd

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that AJ Networks Co Ltd can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the AJ Networks Co Ltd, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which AJ Networks Co 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 AJ Networks Co Ltd can be done for the following purposes –
1. Strategic planning of AJ Networks Co Ltd
2. Improving business portfolio management of AJ Networks Co Ltd
3. Assessing feasibility of the new initiative in South Korea
4. Making a Rental & Leasing sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of AJ Networks Co Ltd

---

Strengths of AJ Networks Co Ltd | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of AJ Networks Co Ltd are -

Innovation driven organization

– AJ Networks Co Ltd is one of the most innovative firm in Rental & Leasing sector.

Cross disciplinary teams

– Horizontal connected teams at the AJ Networks Co 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 AJ Networks Co Ltd comprises – understanding the underlying the factors in the Rental & Leasing 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.

Digital Transformation in Rental & Leasing industry

- digital transformation varies from industry to industry. For AJ Networks Co Ltd digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. AJ Networks Co Ltd 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.

Superior customer experience

– The customer experience strategy of AJ Networks Co Ltd in Rental & Leasing industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

High brand equity

– AJ Networks Co Ltd has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled AJ Networks Co Ltd to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Effective Research and Development (R&D)

– AJ Networks Co Ltd has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – AJ Networks Co Ltd staying ahead in the Rental & Leasing industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

Sustainable margins compare to other players in Rental & Leasing industry

– AJ Networks Co Ltd has clearly differentiated products in the market place. This has enabled AJ Networks Co Ltd to fetch slight price premium compare to the competitors in the Rental & Leasing industry. The sustainable margins have also helped AJ Networks Co Ltd to invest into research and development (R&D) and innovation.

Low bargaining power of suppliers

– Suppliers of AJ Networks Co Ltd in the Services sector have low bargaining power. AJ Networks Co Ltd has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps AJ Networks Co Ltd to manage not only supply disruptions but also source products at highly competitive prices.

Strong track record of project management in the Rental & Leasing industry

– AJ Networks Co 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 Rental & Leasing

– AJ Networks Co Ltd is one of the leading players in the Rental & Leasing industry in South Korea. Over the years it has not only transformed the business landscape in the Rental & Leasing industry in South Korea but also across the existing markets. The ability to lead change has enabled AJ Networks Co Ltd in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

Highly skilled collaborators

– AJ Networks Co Ltd has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Rental & Leasing industry. Secondly the value chain collaborators of AJ Networks Co Ltd have helped the firm to develop new products and bring them quickly to the marketplace.

---

---

Weaknesses of AJ Networks Co Ltd | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of AJ Networks Co Ltd are -

Need for greater diversity

– AJ Networks Co 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 Rental & Leasing industry

– because of the regulatory requirements in South Korea, AJ Networks Co 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 Rental & Leasing industry.

Ability to respond to the competition

– As the decision making is very deliberative at AJ Networks Co Ltd, in the dynamic environment of Rental & Leasing industry it has struggled to respond to the nimble upstart competition. AJ Networks Co Ltd has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

Skills based hiring in Rental & Leasing industry

– The stress on hiring functional specialists at AJ Networks Co 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.

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 AJ Networks Co Ltd supply chain. Even after few cautionary changes, AJ Networks Co Ltd is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left AJ Networks Co Ltd vulnerable to further global disruptions in South East Asia.

High operating costs

– Compare to the competitors, AJ Networks Co Ltd has high operating costs in the Rental & Leasing industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract AJ Networks Co Ltd lucrative customers.

Compensation and incentives

– The revenue per employee of AJ Networks Co Ltd is just above the Rental & Leasing 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.

High dependence on AJ Networks Co Ltd ‘s star products

– The top 2 products and services of AJ Networks Co Ltd still accounts for major business revenue. This dependence on star products in Rental & Leasing industry has resulted into insufficient focus on developing new products, even though AJ Networks Co Ltd has relatively successful track record of launching new products.

Increasing silos among functional specialists

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

Low market penetration in new markets

– Outside its home market of South Korea, AJ Networks Co Ltd needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.

Products dominated business model

– Even though AJ Networks Co Ltd has some of the most successful models in the Rental & Leasing industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. AJ Networks Co Ltd should strive to include more intangible value offerings along with its core products and services.

---

AJ Networks Co Ltd Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of AJ Networks Co Ltd are -

Finding new ways to collaborate

– Covid-19 has not only transformed business models of companies in Rental & Leasing industry, but it has also influenced the consumer preferences. AJ Networks Co Ltd can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

Creating value in data economy

– The success of analytics program of AJ Networks Co Ltd has opened avenues for new revenue streams for the organization in Rental & Leasing industry. This can help AJ Networks Co Ltd to build a more holistic ecosystem for AJ Networks Co Ltd products in the Rental & Leasing industry by providing – data insight services, data privacy related products, data based consulting services, etc.

Loyalty marketing

– AJ Networks Co 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.

Using analytics as competitive advantage

– AJ Networks Co Ltd has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Rental & Leasing sector. This continuous investment in analytics has enabled AJ Networks Co Ltd to build a competitive advantage using analytics. The analytics driven competitive advantage can help AJ Networks Co Ltd to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.

Buying journey improvements

– AJ Networks Co Ltd can improve the customer journey of consumers in the Rental & Leasing 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.

Developing new processes and practices

– AJ Networks Co Ltd can develop new processes and procedures in Rental & Leasing 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.

Building a culture of innovation

– managers at AJ Networks Co 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 Rental & Leasing industry.

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 AJ Networks Co 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.

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. AJ Networks Co Ltd can explore opportunities that can attract volunteers and are consistent with its mission and vision.

Changes in consumer behavior post Covid-19

– consumer behavior has changed in the Rental & Leasing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. AJ Networks Co 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. AJ Networks Co 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.

Redefining models of collaboration and team work

– As explained in the weaknesses section, AJ Networks Co Ltd is facing challenges because of the dominance of functional experts in the organization. AJ Networks Co Ltd can utilize new technology in the field of Rental & Leasing industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for AJ Networks Co 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 AJ Networks Co Ltd to hire the very best people irrespective of their geographical location.

Learning at scale

– Online learning technologies has now opened space for AJ Networks Co 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.

---

Threats AJ Networks Co Ltd External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of AJ Networks Co Ltd are -

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 AJ Networks Co Ltd in the Rental & Leasing sector and impact the bottomline of the organization.

Technology acceleration in Forth Industrial Revolution

– AJ Networks Co Ltd has witnessed rapid integration of technology during Covid-19 in the Rental & Leasing industry. As one of the leading players in the industry, AJ Networks Co Ltd needs to keep up with the evolution of technology in the Rental & Leasing 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.

Increasing wage structure of AJ Networks Co 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 AJ Networks Co Ltd.

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 AJ Networks Co 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 AJ Networks Co Ltd business can come under increasing regulations regarding data privacy, data security, etc.

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.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for AJ Networks Co Ltd in Rental & Leasing industry. The Rental & Leasing 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.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, AJ Networks Co 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 AJ Networks Co Ltd prominent markets.

High dependence on third party suppliers

– AJ Networks Co 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.

Easy access to finance

– Easy access to finance in Rental & Leasing industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. AJ Networks Co Ltd can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry to Rental & Leasing industry are lowering. It can presents AJ Networks Co Ltd with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Rental & Leasing sector.

Shortening product life cycle

– it is one of the major threat that AJ Networks Co Ltd is facing in Rental & Leasing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

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. AJ Networks Co Ltd needs to understand the core reasons impacting the Rental & Leasing industry. This will help it in building a better workplace.

---

Weighted SWOT Analysis of AJ Networks Co Ltd Template, Example

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

--- ---