ThinkwareSystems (84730) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for ThinkwareSystems (South Korea)

Based on various researches at Oak Spring University , ThinkwareSystems is operating in a macro-environment that has been destablized by – geopolitical disruptions, technology disruption, central banks are concerned over increasing inflation, talent flight as more people leaving formal jobs, banking and financial system is disrupted by Bitcoin and other crypto currencies, competitive advantages are harder to sustain because of technology dispersion, increasing government debt because of Covid-19 spendings, increasing commodity prices, there is increasing trade war between United States & China, etc

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Introduction to SWOT Analysis of ThinkwareSystems

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that ThinkwareSystems can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the ThinkwareSystems, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which ThinkwareSystems 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of ThinkwareSystems can be done for the following purposes –
1. Strategic planning of ThinkwareSystems
2. Improving business portfolio management of ThinkwareSystems
3. Assessing feasibility of the new initiative in South Korea
4. Making a Communications Equipment sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of ThinkwareSystems

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Strengths of ThinkwareSystems | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of ThinkwareSystems are -

Low bargaining power of suppliers

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

Diverse revenue streams

– ThinkwareSystems is present in almost all the verticals within the Communications Equipment industry. This has provided ThinkwareSystems 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.

High switching costs

– The high switching costs that ThinkwareSystems 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.

Ability to recruit top talent

– ThinkwareSystems is one of the leading players in the Communications Equipment 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.

Cross disciplinary teams

– Horizontal connected teams at the ThinkwareSystems 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.

Organizational Resilience of ThinkwareSystems

– The covid-19 pandemic has put organizational resilience at the centre of everthing ThinkwareSystems does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.

Analytics focus

– ThinkwareSystems 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 Communications Equipment 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.

Highly skilled collaborators

– ThinkwareSystems has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Communications Equipment industry. Secondly the value chain collaborators of ThinkwareSystems have helped the firm to develop new products and bring them quickly to the marketplace.

Sustainable margins compare to other players in Communications Equipment industry

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

Learning organization

- ThinkwareSystems 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 ThinkwareSystems is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at ThinkwareSystems emphasize – knowledge, initiative, and innovation.

Innovation driven organization

– ThinkwareSystems is one of the most innovative firm in Communications Equipment sector.

Successful track record of launching new products

– ThinkwareSystems has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. ThinkwareSystems 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.

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Weaknesses of ThinkwareSystems | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of ThinkwareSystems are -

Products dominated business model

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

Compensation and incentives

– The revenue per employee of ThinkwareSystems is just above the Communications Equipment 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.

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, ThinkwareSystems is slow explore the new channels of communication. These new channels of communication can help ThinkwareSystems to provide better information regarding Communications Equipment products and services. It can also build an online community to further reach out to potential customers.

Capital Spending Reduction

– Even during the low interest decade, ThinkwareSystems 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 Communications Equipment industry using digital technology.

Workers concerns about automation

– As automation is fast increasing in the Communications Equipment industry, ThinkwareSystems 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.

Employees’ less understanding of ThinkwareSystems strategy

– From the outside it seems that the employees of ThinkwareSystems 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.

Ability to respond to the competition

– As the decision making is very deliberative at ThinkwareSystems, in the dynamic environment of Communications Equipment industry it has struggled to respond to the nimble upstart competition. ThinkwareSystems has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

Need for greater diversity

– ThinkwareSystems 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.

Increasing silos among functional specialists

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

Lack of clear differentiation of ThinkwareSystems products

– To increase the profitability and margins on the products, ThinkwareSystems needs to provide more differentiated products than what it is currently offering in the marketplace.

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

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ThinkwareSystems Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of ThinkwareSystems are -

Low interest rates

– Even though inflation is raising its head in most developed economies, ThinkwareSystems 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.

Using analytics as competitive advantage

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

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects ThinkwareSystems can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

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. ThinkwareSystems can explore opportunities that can attract volunteers and are consistent with its mission and vision.

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 ThinkwareSystems 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.

Leveraging digital technologies

– ThinkwareSystems 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.

Remote work and new talent hiring opportunities

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

Better consumer reach

– The expansion of the 5G network will help ThinkwareSystems to increase its market reach. ThinkwareSystems 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.

Building a culture of innovation

– managers at ThinkwareSystems 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 Communications Equipment industry.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, ThinkwareSystems can use these opportunities to build new business models that can help the communities that ThinkwareSystems operates in. Secondly it can use opportunities from government spending in Communications Equipment sector.

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, ThinkwareSystems 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 ThinkwareSystems to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

Buying journey improvements

– ThinkwareSystems can improve the customer journey of consumers in the Communications Equipment 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.

Learning at scale

– Online learning technologies has now opened space for ThinkwareSystems 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.

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Threats ThinkwareSystems External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of ThinkwareSystems are -

High dependence on third party suppliers

– ThinkwareSystems 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.

Regulatory challenges

– ThinkwareSystems 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 Communications Equipment industry regulations.

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, ThinkwareSystems may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Communications Equipment sector.

Increasing wage structure of ThinkwareSystems

– 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 ThinkwareSystems.

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. ThinkwareSystems needs to understand the core reasons impacting the Communications Equipment industry. This will help it in building a better workplace.

Shortening product life cycle

– it is one of the major threat that ThinkwareSystems is facing in Communications Equipment sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

Consumer confidence and its impact on ThinkwareSystems 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 Communications Equipment industry and other sectors.

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 ThinkwareSystems in the Communications Equipment sector and impact the bottomline of the organization.

Easy access to finance

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

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 ThinkwareSystems in Communications Equipment industry. The Communications Equipment 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.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry to Communications Equipment industry are lowering. It can presents ThinkwareSystems with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Communications Equipment sector.

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Weighted SWOT Analysis of ThinkwareSystems Template, Example

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

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