SWOT Analysis / TOWS Matrix for Dong Ah Tire Rubber (South Korea)
Based on various researches at Oak Spring University , Dong Ah Tire Rubber is operating in a macro-environment that has been destablized by – there is backlash against globalization, banking and financial system is disrupted by Bitcoin and other crypto currencies, supply chains are disrupted by pandemic , wage bills are increasing, increasing transportation and logistics costs, geopolitical disruptions, increasing inequality as vast percentage of new income is going to the top 1%,
customer relationship management is fast transforming because of increasing concerns over data privacy, technology disruption, etc
Introduction to SWOT Analysis of Dong Ah Tire Rubber
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Dong Ah Tire Rubber can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Dong Ah Tire Rubber, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Dong Ah Tire Rubber 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 Dong Ah Tire Rubber can be done for the following purposes –
1. Strategic planning of Dong Ah Tire Rubber
2. Improving business portfolio management of Dong Ah Tire Rubber
3. Assessing feasibility of the new initiative in South Korea
4. Making a Tires sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Dong Ah Tire Rubber
Strengths of Dong Ah Tire Rubber | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Dong Ah Tire Rubber are -
Learning organization
- Dong Ah Tire Rubber 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 Dong Ah Tire Rubber is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Dong Ah Tire Rubber emphasize – knowledge, initiative, and innovation.
High brand equity
– Dong Ah Tire Rubber has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Dong Ah Tire Rubber to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
High switching costs
– The high switching costs that Dong Ah Tire Rubber 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.
Successful track record of launching new products
– Dong Ah Tire Rubber has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Dong Ah Tire Rubber 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.
Ability to lead change in Tires
– Dong Ah Tire Rubber is one of the leading players in the Tires industry in South Korea. Over the years it has not only transformed the business landscape in the Tires industry in South Korea but also across the existing markets. The ability to lead change has enabled Dong Ah Tire Rubber in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Diverse revenue streams
– Dong Ah Tire Rubber is present in almost all the verticals within the Tires industry. This has provided Dong Ah Tire Rubber 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.
Innovation driven organization
– Dong Ah Tire Rubber is one of the most innovative firm in Tires sector.
Training and development
– Dong Ah Tire Rubber has one of the best training and development program in Consumer 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.
Ability to recruit top talent
– Dong Ah Tire Rubber is one of the leading players in the Tires industry in South Korea. It is in a position to attract the best talent available in South Korea. The firm has a robust talent identification program that helps in identifying the brightest.
Sustainable margins compare to other players in Tires industry
– Dong Ah Tire Rubber has clearly differentiated products in the market place. This has enabled Dong Ah Tire Rubber to fetch slight price premium compare to the competitors in the Tires industry. The sustainable margins have also helped Dong Ah Tire Rubber to invest into research and development (R&D) and innovation.
Strong track record of project management in the Tires industry
– Dong Ah Tire Rubber is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Digital Transformation in Tires industry
- digital transformation varies from industry to industry. For Dong Ah Tire Rubber digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Dong Ah Tire Rubber 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.
Weaknesses of Dong Ah Tire Rubber | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Dong Ah Tire Rubber are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Dong Ah Tire Rubber is slow explore the new channels of communication. These new channels of communication can help Dong Ah Tire Rubber to provide better information regarding Tires products and services. It can also build an online community to further reach out to potential customers.
Need for greater diversity
– Dong Ah Tire Rubber 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 dependence on Dong Ah Tire Rubber ‘s star products
– The top 2 products and services of Dong Ah Tire Rubber still accounts for major business revenue. This dependence on star products in Tires industry has resulted into insufficient focus on developing new products, even though Dong Ah Tire Rubber has relatively successful track record of launching new products.
Aligning sales with marketing
– From the outside it seems that Dong Ah Tire Rubber needs to have more collaboration between its sales team and marketing team. Sales professionals in the Tires industry have deep experience in developing customer relationships. Marketing department at Dong Ah Tire Rubber can leverage the sales team experience to cultivate customer relationships as Dong Ah Tire Rubber is planning to shift buying processes online.
Skills based hiring in Tires industry
– The stress on hiring functional specialists at Dong Ah Tire Rubber 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.
Increasing silos among functional specialists
– The organizational structure of Dong Ah Tire Rubber is dominated by functional specialists. It is not different from other players in the Tires industry, but Dong Ah Tire Rubber needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Dong Ah Tire Rubber to focus more on services in the Tires industry rather than just following the product 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 Dong Ah Tire Rubber supply chain. Even after few cautionary changes, Dong Ah Tire Rubber is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Dong Ah Tire Rubber vulnerable to further global disruptions in South East Asia.
High operating costs
– Compare to the competitors, Dong Ah Tire Rubber has high operating costs in the Tires industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Dong Ah Tire Rubber lucrative customers.
High bargaining power of channel partners in Tires industry
– because of the regulatory requirements in South Korea, Dong Ah Tire Rubber 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 Tires industry.
Interest costs
– Compare to the competition, Dong Ah Tire Rubber 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 cash cycle compare to competitors
Dong Ah Tire Rubber has a high cash cycle compare to other players in the Tires industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Dong Ah Tire Rubber Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Dong Ah Tire Rubber are -
Better consumer reach
– The expansion of the 5G network will help Dong Ah Tire Rubber to increase its market reach. Dong Ah Tire Rubber 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Dong Ah Tire Rubber 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 Dong Ah Tire Rubber to hire the very best people irrespective of their geographical location.
Creating value in data economy
– The success of analytics program of Dong Ah Tire Rubber has opened avenues for new revenue streams for the organization in Tires industry. This can help Dong Ah Tire Rubber to build a more holistic ecosystem for Dong Ah Tire Rubber products in the Tires industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Dong Ah Tire Rubber is facing challenges because of the dominance of functional experts in the organization. Dong Ah Tire Rubber can utilize new technology in the field of Tires 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, Dong Ah Tire Rubber 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 Dong Ah Tire Rubber to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Building a culture of innovation
– managers at Dong Ah Tire Rubber 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 Tires industry.
Buying journey improvements
– Dong Ah Tire Rubber can improve the customer journey of consumers in the Tires 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Dong Ah Tire Rubber in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Tires industry, and it will provide faster access to the consumers.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Tires industry, but it has also influenced the consumer preferences. Dong Ah Tire Rubber can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Use of Bitcoin and other crypto currencies for transactions in Tires industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Dong Ah Tire Rubber in the Tires industry. Now Dong Ah Tire Rubber can target international markets with far fewer capital restrictions requirements than the existing system.
Using analytics as competitive advantage
– Dong Ah Tire Rubber has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Tires sector. This continuous investment in analytics has enabled Dong Ah Tire Rubber to build a competitive advantage using analytics. The analytics driven competitive advantage can help Dong Ah Tire Rubber to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Developing new processes and practices
– Dong Ah Tire Rubber can develop new processes and procedures in Tires 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.
Leveraging digital technologies
– Dong Ah Tire Rubber 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.
Threats Dong Ah Tire Rubber External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Dong Ah Tire Rubber are -
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 Dong Ah Tire Rubber.
Regulatory challenges
– Dong Ah Tire Rubber 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 Tires industry regulations.
Environmental challenges
– Dong Ah Tire Rubber 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. Dong Ah Tire Rubber can take advantage of this fund but it will also bring new competitors in the Tires 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 Dong Ah Tire Rubber business can come under increasing regulations regarding data privacy, data security, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Dong Ah Tire Rubber may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Tires sector.
Easy access to finance
– Easy access to finance in Tires industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Dong Ah Tire Rubber can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Dong Ah Tire Rubber 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.
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.
Consumer confidence and its impact on Dong Ah Tire Rubber 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 Tires industry and other sectors.
High dependence on third party suppliers
– Dong Ah Tire Rubber 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.
Increasing wage structure of Dong Ah Tire Rubber
– 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 Dong Ah Tire Rubber.
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Dong Ah Tire Rubber 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 Dong Ah Tire Rubber prominent markets.
Weighted SWOT Analysis of Dong Ah Tire Rubber Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Dong Ah Tire Rubber 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 Dong Ah Tire Rubber 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 Dong Ah Tire Rubber 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 Dong Ah Tire Rubber 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 Dong Ah Tire Rubber needs to make to build a sustainable competitive advantage.
