AeroSpace Tech of Korea (67390) SWOT Analysis / TOWS Matrix / MBA Resources
Aerospace & Defense
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for AeroSpace Tech of Korea (South Korea)
Based on various researches at Oak Spring University , AeroSpace Tech of Korea is operating in a macro-environment that has been destablized by – there is increasing trade war between United States & China, there is backlash against globalization, wage bills are increasing, geopolitical disruptions, increasing household debt because of falling income levels, increasing government debt because of Covid-19 spendings, increasing transportation and logistics costs,
cloud computing is disrupting traditional business models, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of AeroSpace Tech of Korea
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that AeroSpace Tech of Korea can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the AeroSpace Tech of Korea, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which AeroSpace Tech of Korea 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 AeroSpace Tech of Korea can be done for the following purposes –
1. Strategic planning of AeroSpace Tech of Korea
2. Improving business portfolio management of AeroSpace Tech of Korea
3. Assessing feasibility of the new initiative in South Korea
4. Making a Aerospace & Defense sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of AeroSpace Tech of Korea
Strengths of AeroSpace Tech of Korea | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of AeroSpace Tech of Korea are -
Highly skilled collaborators
– AeroSpace Tech of Korea has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Aerospace & Defense industry. Secondly the value chain collaborators of AeroSpace Tech of Korea have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– AeroSpace Tech of Korea is one of the most innovative firm in Aerospace & Defense sector.
Superior customer experience
– The customer experience strategy of AeroSpace Tech of Korea in Aerospace & Defense industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– AeroSpace Tech of Korea has one of the best training and development program in Capital Goods 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.
Analytics focus
– AeroSpace Tech of Korea 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 Aerospace & Defense industry. The technology infrastructure of South Korea 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.
Digital Transformation in Aerospace & Defense industry
- digital transformation varies from industry to industry. For AeroSpace Tech of Korea digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. AeroSpace Tech of Korea 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.
Ability to lead change in Aerospace & Defense
– AeroSpace Tech of Korea is one of the leading players in the Aerospace & Defense industry in South Korea. Over the years it has not only transformed the business landscape in the Aerospace & Defense industry in South Korea but also across the existing markets. The ability to lead change has enabled AeroSpace Tech of Korea in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Learning organization
- AeroSpace Tech of Korea 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 AeroSpace Tech of Korea is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at AeroSpace Tech of Korea emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– AeroSpace Tech of Korea is one of the leading players in the Aerospace & Defense 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.
High switching costs
– The high switching costs that AeroSpace Tech of Korea 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.
Effective Research and Development (R&D)
– AeroSpace Tech of Korea has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – AeroSpace Tech of Korea staying ahead in the Aerospace & Defense industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High brand equity
– AeroSpace Tech of Korea has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled AeroSpace Tech of Korea to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses of AeroSpace Tech of Korea | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of AeroSpace Tech of Korea are -
Ability to respond to the competition
– As the decision making is very deliberative at AeroSpace Tech of Korea, in the dynamic environment of Aerospace & Defense industry it has struggled to respond to the nimble upstart competition. AeroSpace Tech of Korea has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Employees’ less understanding of AeroSpace Tech of Korea strategy
– From the outside it seems that the employees of AeroSpace Tech of Korea 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.
High bargaining power of channel partners in Aerospace & Defense industry
– because of the regulatory requirements in South Korea, AeroSpace Tech of Korea 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 Aerospace & Defense industry.
Need for greater diversity
– AeroSpace Tech of Korea 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.
Interest costs
– Compare to the competition, AeroSpace Tech of Korea 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.
Capital Spending Reduction
– Even during the low interest decade, AeroSpace Tech of Korea 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 Aerospace & Defense industry using digital technology.
Compensation and incentives
– The revenue per employee of AeroSpace Tech of Korea is just above the Aerospace & Defense 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.
Aligning sales with marketing
– From the outside it seems that AeroSpace Tech of Korea needs to have more collaboration between its sales team and marketing team. Sales professionals in the Aerospace & Defense industry have deep experience in developing customer relationships. Marketing department at AeroSpace Tech of Korea can leverage the sales team experience to cultivate customer relationships as AeroSpace Tech of Korea is planning to shift buying processes online.
Products dominated business model
– Even though AeroSpace Tech of Korea has some of the most successful models in the Aerospace & Defense industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. AeroSpace Tech of Korea should strive to include more intangible value offerings along with its core products and services.
Workers concerns about automation
– As automation is fast increasing in the Aerospace & Defense industry, AeroSpace Tech of Korea 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, AeroSpace Tech of Korea is slow explore the new channels of communication. These new channels of communication can help AeroSpace Tech of Korea to provide better information regarding Aerospace & Defense products and services. It can also build an online community to further reach out to potential customers.
AeroSpace Tech of Korea Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of AeroSpace Tech of Korea are -
Better consumer reach
– The expansion of the 5G network will help AeroSpace Tech of Korea to increase its market reach. AeroSpace Tech of Korea 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, AeroSpace Tech of Korea is facing challenges because of the dominance of functional experts in the organization. AeroSpace Tech of Korea can utilize new technology in the field of Aerospace & Defense industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects AeroSpace Tech of Korea can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Aerospace & Defense industry, but it has also influenced the consumer preferences. AeroSpace Tech of Korea can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Aerospace & Defense industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. AeroSpace Tech of Korea 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. AeroSpace Tech of Korea 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.
Learning at scale
– Online learning technologies has now opened space for AeroSpace Tech of Korea 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.
Loyalty marketing
– AeroSpace Tech of Korea 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, AeroSpace Tech of Korea can use these opportunities to build new business models that can help the communities that AeroSpace Tech of Korea operates in. Secondly it can use opportunities from government spending in Aerospace & Defense sector.
Developing new processes and practices
– AeroSpace Tech of Korea can develop new processes and procedures in Aerospace & Defense 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, AeroSpace Tech of Korea 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for AeroSpace Tech of Korea in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Aerospace & Defense industry, and it will provide faster access to the consumers.
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 AeroSpace Tech of Korea 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.
Using analytics as competitive advantage
– AeroSpace Tech of Korea has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Aerospace & Defense sector. This continuous investment in analytics has enabled AeroSpace Tech of Korea to build a competitive advantage using analytics. The analytics driven competitive advantage can help AeroSpace Tech of Korea to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats AeroSpace Tech of Korea External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of AeroSpace Tech of Korea are -
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 AeroSpace Tech of Korea business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– AeroSpace Tech of Korea 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 international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, AeroSpace Tech of Korea 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 AeroSpace Tech of Korea prominent markets.
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 AeroSpace Tech of Korea.
Stagnating economy with rate increase
– AeroSpace Tech of Korea 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 Aerospace & Defense industry.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for AeroSpace Tech of Korea in Aerospace & Defense industry. The Aerospace & Defense 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.
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.
Regulatory challenges
– AeroSpace Tech of Korea 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 Aerospace & Defense industry regulations.
Increasing wage structure of AeroSpace Tech of Korea
– 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 AeroSpace Tech of Korea.
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.
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 AeroSpace Tech of Korea in the Aerospace & Defense sector and impact the bottomline of the organization.
Environmental challenges
– AeroSpace Tech of Korea 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. AeroSpace Tech of Korea can take advantage of this fund but it will also bring new competitors in the Aerospace & Defense industry.
Technology acceleration in Forth Industrial Revolution
– AeroSpace Tech of Korea has witnessed rapid integration of technology during Covid-19 in the Aerospace & Defense industry. As one of the leading players in the industry, AeroSpace Tech of Korea needs to keep up with the evolution of technology in the Aerospace & Defense 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.
Weighted SWOT Analysis of AeroSpace Tech of Korea Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at AeroSpace Tech of Korea 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 AeroSpace Tech of Korea 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 AeroSpace Tech of Korea 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 AeroSpace Tech of Korea 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 AeroSpace Tech of Korea needs to make to build a sustainable competitive advantage.