SWOT Analysis / TOWS Matrix for TAPEX INC (South Korea)
Based on various researches at Oak Spring University , TAPEX INC is operating in a macro-environment that has been destablized by – increasing household debt because of falling income levels, increasing transportation and logistics costs, wage bills are increasing, supply chains are disrupted by pandemic , cloud computing is disrupting traditional business models, geopolitical disruptions, there is backlash against globalization,
there is increasing trade war between United States & China, challanges to central banks by blockchain based private currencies, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that TAPEX INC can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the TAPEX INC, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which TAPEX INC 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 TAPEX INC can be done for the following purposes –
1. Strategic planning of TAPEX INC
2. Improving business portfolio management of TAPEX INC
3. Assessing feasibility of the new initiative in South Korea
4. Making a Containers & Packaging sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of TAPEX INC
Strengths of TAPEX INC | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of TAPEX INC are -
Effective Research and Development (R&D)
– TAPEX INC has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – TAPEX INC staying ahead in the Containers & Packaging industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Low bargaining power of suppliers
– Suppliers of TAPEX INC in the Basic Materials sector have low bargaining power. TAPEX INC has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps TAPEX INC to manage not only supply disruptions but also source products at highly competitive prices.
Ability to lead change in Containers & Packaging
– TAPEX INC is one of the leading players in the Containers & Packaging industry in South Korea. Over the years it has not only transformed the business landscape in the Containers & Packaging industry in South Korea but also across the existing markets. The ability to lead change has enabled TAPEX INC in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Diverse revenue streams
– TAPEX INC is present in almost all the verticals within the Containers & Packaging industry. This has provided TAPEX INC 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.
Successful track record of launching new products
– TAPEX INC has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. TAPEX INC 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.
High switching costs
– The high switching costs that TAPEX INC 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.
Organizational Resilience of TAPEX INC
– The covid-19 pandemic has put organizational resilience at the centre of everthing TAPEX INC does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Cross disciplinary teams
– Horizontal connected teams at the TAPEX INC 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.
Analytics focus
– TAPEX INC 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 Containers & Packaging 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.
Operational resilience
– The operational resilience strategy of TAPEX INC comprises – understanding the underlying the factors in the Containers & Packaging 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.
Highly skilled collaborators
– TAPEX INC has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Containers & Packaging industry. Secondly the value chain collaborators of TAPEX INC have helped the firm to develop new products and bring them quickly to the marketplace.
Learning organization
- TAPEX INC 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 TAPEX INC is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at TAPEX INC emphasize – knowledge, initiative, and innovation.
Weaknesses of TAPEX INC | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of TAPEX INC are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, TAPEX INC is slow explore the new channels of communication. These new channels of communication can help TAPEX INC to provide better information regarding Containers & Packaging products and services. It can also build an online community to further reach out to potential customers.
High operating costs
– Compare to the competitors, TAPEX INC has high operating costs in the Containers & Packaging industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract TAPEX INC lucrative customers.
High bargaining power of channel partners in Containers & Packaging industry
– because of the regulatory requirements in South Korea, TAPEX INC 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 Containers & Packaging industry.
Skills based hiring in Containers & Packaging industry
– The stress on hiring functional specialists at TAPEX INC 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.
Employees’ less understanding of TAPEX INC strategy
– From the outside it seems that the employees of TAPEX INC 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 cash cycle compare to competitors
TAPEX INC has a high cash cycle compare to other players in the Containers & Packaging industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Interest costs
– Compare to the competition, TAPEX INC 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.
Increasing silos among functional specialists
– The organizational structure of TAPEX INC is dominated by functional specialists. It is not different from other players in the Containers & Packaging industry, but TAPEX INC needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help TAPEX INC to focus more on services in the Containers & Packaging industry rather than just following the product oriented approach.
Need for greater diversity
– TAPEX INC 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.
No frontier risks strategy
– From the 10K / annual statement of TAPEX INC, it seems that company is thinking out the frontier risks that can impact Containers & Packaging 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.
Ability to respond to the competition
– As the decision making is very deliberative at TAPEX INC, in the dynamic environment of Containers & Packaging industry it has struggled to respond to the nimble upstart competition. TAPEX INC has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
TAPEX INC Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of TAPEX INC are -
Manufacturing automation
– TAPEX INC can use the latest technology developments to improve its manufacturing and designing process in Containers & Packaging 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, TAPEX INC 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 TAPEX INC to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Learning at scale
– Online learning technologies has now opened space for TAPEX INC 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.
Creating value in data economy
– The success of analytics program of TAPEX INC has opened avenues for new revenue streams for the organization in Containers & Packaging industry. This can help TAPEX INC to build a more holistic ecosystem for TAPEX INC products in the Containers & Packaging 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, TAPEX INC is facing challenges because of the dominance of functional experts in the organization. TAPEX INC can utilize new technology in the field of Containers & Packaging industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Developing new processes and practices
– TAPEX INC can develop new processes and procedures in Containers & Packaging 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.
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 TAPEX INC 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. TAPEX INC 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 Containers & Packaging industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. TAPEX INC 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. TAPEX INC 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.
Use of Bitcoin and other crypto currencies for transactions in Containers & Packaging industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for TAPEX INC in the Containers & Packaging industry. Now TAPEX INC can target international markets with far fewer capital restrictions requirements than the existing system.
Leveraging digital technologies
– TAPEX INC 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.
Building a culture of innovation
– managers at TAPEX INC 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 Containers & Packaging industry.
Buying journey improvements
– TAPEX INC can improve the customer journey of consumers in the Containers & Packaging 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.
Threats TAPEX INC External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of TAPEX INC are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Containers & Packaging industry are lowering. It can presents TAPEX INC with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Containers & Packaging sector.
Consumer confidence and its impact on TAPEX INC 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 Containers & Packaging industry and other sectors.
Environmental challenges
– TAPEX INC 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. TAPEX INC can take advantage of this fund but it will also bring new competitors in the Containers & Packaging industry.
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 TAPEX INC.
Stagnating economy with rate increase
– TAPEX INC 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 Containers & Packaging industry.
Regulatory challenges
– TAPEX INC 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 Containers & Packaging industry regulations.
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. TAPEX INC needs to understand the core reasons impacting the Containers & Packaging industry. This will help it in building a better workplace.
High dependence on third party suppliers
– TAPEX INC 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.
Shortening product life cycle
– it is one of the major threat that TAPEX INC is facing in Containers & Packaging sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 TAPEX INC in the Containers & Packaging sector and impact the bottomline of the organization.
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. TAPEX INC 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.
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 TAPEX INC business can come under increasing regulations regarding data privacy, data security, etc.
Increasing wage structure of TAPEX INC
– 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 TAPEX INC.
Weighted SWOT Analysis of TAPEX INC Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at TAPEX INC 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 TAPEX INC 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 TAPEX INC 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 TAPEX INC 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 TAPEX INC needs to make to build a sustainable competitive advantage.