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 – wage bills are increasing, technology disruption, geopolitical disruptions, talent flight as more people leaving formal jobs, digital marketing is dominated by two big players Facebook and Google, central banks are concerned over increasing inflation, increasing government debt because of Covid-19 spendings, increasing household debt because of falling income levels, increasing inequality as vast percentage of new income is going to the top 1%, 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 -

Digital Transformation in Communications Equipment industry

- digital transformation varies from industry to industry. For ThinkwareSystems digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. ThinkwareSystems 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.

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.

Effective Research and Development (R&D)

– ThinkwareSystems has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – ThinkwareSystems staying ahead in the Communications Equipment industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

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.

Training and development

– ThinkwareSystems has one of the best training and development program in Technology 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.

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.

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.

High brand equity

– ThinkwareSystems has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled ThinkwareSystems to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

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.

Strong track record of project management in the Communications Equipment industry

– ThinkwareSystems is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

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.

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.

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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 -

Aligning sales with marketing

– From the outside it seems that ThinkwareSystems needs to have more collaboration between its sales team and marketing team. Sales professionals in the Communications Equipment industry have deep experience in developing customer relationships. Marketing department at ThinkwareSystems can leverage the sales team experience to cultivate customer relationships as ThinkwareSystems is planning to shift buying processes online.

Slow decision making process

– As mentioned earlier in the report, ThinkwareSystems has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Communications Equipment industry over the last five years. ThinkwareSystems 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.

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.

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.

High cash cycle compare to competitors

ThinkwareSystems has a high cash cycle compare to other players in the Communications Equipment industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.

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.

Low market penetration in new markets

– Outside its home market of South Korea, ThinkwareSystems needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.

High dependence on ThinkwareSystems ‘s star products

– The top 2 products and services of ThinkwareSystems still accounts for major business revenue. This dependence on star products in Communications Equipment industry has resulted into insufficient focus on developing new products, even though ThinkwareSystems has relatively successful track record of launching new products.

Skills based hiring in Communications Equipment industry

– The stress on hiring functional specialists at ThinkwareSystems 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.

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.

High operating costs

– Compare to the competitors, ThinkwareSystems has high operating costs in the Communications Equipment industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract ThinkwareSystems lucrative customers.

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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 -

Changes in consumer behavior post Covid-19

– consumer behavior has changed in the Communications Equipment industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. ThinkwareSystems 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. ThinkwareSystems 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.

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.

Manufacturing automation

– ThinkwareSystems can use the latest technology developments to improve its manufacturing and designing process in Communications Equipment 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.

Developing new processes and practices

– ThinkwareSystems can develop new processes and procedures in Communications Equipment 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.

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.

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.

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.

Use of Bitcoin and other crypto currencies for transactions in Communications Equipment industry

– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for ThinkwareSystems in the Communications Equipment industry. Now ThinkwareSystems can target international markets with far fewer capital restrictions requirements than the existing system.

Finding new ways to collaborate

– Covid-19 has not only transformed business models of companies in Communications Equipment industry, but it has also influenced the consumer preferences. ThinkwareSystems can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

Redefining models of collaboration and team work

– As explained in the weaknesses section, ThinkwareSystems is facing challenges because of the dominance of functional experts in the organization. ThinkwareSystems can utilize new technology in the field of Communications Equipment industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.

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.

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.

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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 -

Technology acceleration in Forth Industrial Revolution

– ThinkwareSystems has witnessed rapid integration of technology during Covid-19 in the Communications Equipment industry. As one of the leading players in the industry, ThinkwareSystems needs to keep up with the evolution of technology in the Communications Equipment 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

– ThinkwareSystems 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 Communications Equipment industry.

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.

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 ThinkwareSystems.

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.

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 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.

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.

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. ThinkwareSystems 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.

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.

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.

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.

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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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