Nong Woo Bio (54050) SWOT Analysis / TOWS Matrix / MBA Resources
Crops
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Nong Woo Bio (South Korea)
Based on various researches at Oak Spring University , Nong Woo Bio is operating in a macro-environment that has been destablized by – technology disruption, increasing inequality as vast percentage of new income is going to the top 1%, increasing government debt because of Covid-19 spendings, talent flight as more people leaving formal jobs, digital marketing is dominated by two big players Facebook and Google, competitive advantages are harder to sustain because of technology dispersion, wage bills are increasing,
supply chains are disrupted by pandemic , cloud computing is disrupting traditional business models, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Nong Woo Bio can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Nong Woo Bio, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Nong Woo Bio 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 Nong Woo Bio can be done for the following purposes –
1. Strategic planning of Nong Woo Bio
2. Improving business portfolio management of Nong Woo Bio
3. Assessing feasibility of the new initiative in South Korea
4. Making a Crops sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Nong Woo Bio
Strengths of Nong Woo Bio | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Nong Woo Bio are -
Digital Transformation in Crops industry
- digital transformation varies from industry to industry. For Nong Woo Bio digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Nong Woo Bio 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.
Cross disciplinary teams
– Horizontal connected teams at the Nong Woo Bio 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.
Highly skilled collaborators
– Nong Woo Bio has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Crops industry. Secondly the value chain collaborators of Nong Woo Bio have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Nong Woo Bio is one of the most innovative firm in Crops sector.
Sustainable margins compare to other players in Crops industry
– Nong Woo Bio has clearly differentiated products in the market place. This has enabled Nong Woo Bio to fetch slight price premium compare to the competitors in the Crops industry. The sustainable margins have also helped Nong Woo Bio to invest into research and development (R&D) and innovation.
High switching costs
– The high switching costs that Nong Woo Bio 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.
High brand equity
– Nong Woo Bio has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Nong Woo Bio to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Training and development
– Nong Woo Bio has one of the best training and development program in Consumer/Non-Cyclical 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.
Low bargaining power of suppliers
– Suppliers of Nong Woo Bio in the Consumer/Non-Cyclical sector have low bargaining power. Nong Woo Bio has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Nong Woo Bio to manage not only supply disruptions but also source products at highly competitive prices.
Operational resilience
– The operational resilience strategy of Nong Woo Bio comprises – understanding the underlying the factors in the Crops 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.
Diverse revenue streams
– Nong Woo Bio is present in almost all the verticals within the Crops industry. This has provided Nong Woo Bio 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.
Strong track record of project management in the Crops industry
– Nong Woo Bio is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses of Nong Woo Bio | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Nong Woo Bio are -
Lack of clear differentiation of Nong Woo Bio products
– To increase the profitability and margins on the products, Nong Woo Bio needs to provide more differentiated products than what it is currently offering in the marketplace.
Skills based hiring in Crops industry
– The stress on hiring functional specialists at Nong Woo Bio 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, Nong Woo Bio 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 bargaining power of channel partners in Crops industry
– because of the regulatory requirements in South Korea, Nong Woo Bio 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 Crops industry.
Products dominated business model
– Even though Nong Woo Bio has some of the most successful models in the Crops industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Nong Woo Bio should strive to include more intangible value offerings along with its core products and services.
Ability to respond to the competition
– As the decision making is very deliberative at Nong Woo Bio, in the dynamic environment of Crops industry it has struggled to respond to the nimble upstart competition. Nong Woo Bio has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
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 Nong Woo Bio supply chain. Even after few cautionary changes, Nong Woo Bio is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Nong Woo Bio vulnerable to further global disruptions in South East Asia.
Slow to strategic competitive environment developments
– As Nong Woo Bio is one of the leading players in the Crops industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Crops industry in last five years.
Workers concerns about automation
– As automation is fast increasing in the Crops industry, Nong Woo Bio needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
High operating costs
– Compare to the competitors, Nong Woo Bio has high operating costs in the Crops industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Nong Woo Bio lucrative customers.
Slow decision making process
– As mentioned earlier in the report, Nong Woo Bio has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Crops industry over the last five years. Nong Woo Bio 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.
Nong Woo Bio Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Nong Woo Bio are -
Low interest rates
– Even though inflation is raising its head in most developed economies, Nong Woo Bio 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Nong Woo Bio can use these opportunities to build new business models that can help the communities that Nong Woo Bio operates in. Secondly it can use opportunities from government spending in Crops sector.
Building a culture of innovation
– managers at Nong Woo Bio 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 Crops industry.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Crops industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Nong Woo Bio 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. Nong Woo Bio 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.
Leveraging digital technologies
– Nong Woo Bio 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.
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. Nong Woo Bio can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Nong Woo Bio in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Crops industry, and it will provide faster access to the consumers.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Nong Woo Bio is facing challenges because of the dominance of functional experts in the organization. Nong Woo Bio can utilize new technology in the field of Crops industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Nong Woo Bio 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 Nong Woo Bio to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Use of Bitcoin and other crypto currencies for transactions in Crops industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Nong Woo Bio in the Crops industry. Now Nong Woo Bio can target international markets with far fewer capital restrictions requirements than the existing system.
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 Nong Woo Bio 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.
Creating value in data economy
– The success of analytics program of Nong Woo Bio has opened avenues for new revenue streams for the organization in Crops industry. This can help Nong Woo Bio to build a more holistic ecosystem for Nong Woo Bio products in the Crops industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Learning at scale
– Online learning technologies has now opened space for Nong Woo Bio 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 Nong Woo Bio External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Nong Woo Bio are -
Increasing wage structure of Nong Woo Bio
– 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 Nong Woo Bio.
Regulatory challenges
– Nong Woo Bio 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 Crops industry regulations.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Nong Woo Bio may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Crops 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. Nong Woo Bio needs to understand the core reasons impacting the Crops industry. This will help it in building a better workplace.
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Nong Woo Bio in Crops industry. The Crops 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.
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 Nong Woo Bio.
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.
Shortening product life cycle
– it is one of the major threat that Nong Woo Bio is facing in Crops sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Nong Woo Bio business can come under increasing regulations regarding data privacy, data security, etc.
Technology acceleration in Forth Industrial Revolution
– Nong Woo Bio has witnessed rapid integration of technology during Covid-19 in the Crops industry. As one of the leading players in the industry, Nong Woo Bio needs to keep up with the evolution of technology in the Crops 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.
Stagnating economy with rate increase
– Nong Woo Bio 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 Crops industry.
Consumer confidence and its impact on Nong Woo Bio 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 Crops industry and other sectors.
Weighted SWOT Analysis of Nong Woo Bio Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Nong Woo Bio 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 Nong Woo Bio 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 Nong Woo Bio 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 Nong Woo Bio 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 Nong Woo Bio needs to make to build a sustainable competitive advantage.