SCI Information Service (36120) SWOT Analysis / TOWS Matrix / MBA Resources
Business Services
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for SCI Information Service (South Korea)
Based on various researches at Oak Spring University , SCI Information Service is operating in a macro-environment that has been destablized by – central banks are concerned over increasing inflation, increasing government debt because of Covid-19 spendings, technology disruption, increasing inequality as vast percentage of new income is going to the top 1%, geopolitical disruptions, wage bills are increasing, banking and financial system is disrupted by Bitcoin and other crypto currencies,
increasing transportation and logistics costs, there is backlash against globalization, etc
Introduction to SWOT Analysis of SCI Information Service
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that SCI Information Service can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the SCI Information Service, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which SCI Information Service 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 SCI Information Service can be done for the following purposes –
1. Strategic planning of SCI Information Service
2. Improving business portfolio management of SCI Information Service
3. Assessing feasibility of the new initiative in South Korea
4. Making a Business Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of SCI Information Service
Strengths of SCI Information Service | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of SCI Information Service are -
Training and development
– SCI Information Service has one of the best training and development program in Services industry. The effectiveness of the training programs can be measured in – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Ability to lead change in Business Services
– SCI Information Service is one of the leading players in the Business Services industry in South Korea. Over the years it has not only transformed the business landscape in the Business Services industry in South Korea but also across the existing markets. The ability to lead change has enabled SCI Information Service in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Cross disciplinary teams
– Horizontal connected teams at the SCI Information Service 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
– SCI Information Service 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 Business Services 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.
Low bargaining power of suppliers
– Suppliers of SCI Information Service in the Services sector have low bargaining power. SCI Information Service has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps SCI Information Service to manage not only supply disruptions but also source products at highly competitive prices.
Learning organization
- SCI Information Service 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 SCI Information Service is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at SCI Information Service emphasize – knowledge, initiative, and innovation.
Highly skilled collaborators
– SCI Information Service has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Business Services industry. Secondly the value chain collaborators of SCI Information Service have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– SCI Information Service has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. SCI Information Service 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 SCI Information Service 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.
Digital Transformation in Business Services industry
- digital transformation varies from industry to industry. For SCI Information Service digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. SCI Information Service 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.
Organizational Resilience of SCI Information Service
– The covid-19 pandemic has put organizational resilience at the centre of everthing SCI Information Service does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Strong track record of project management in the Business Services industry
– SCI Information Service is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses of SCI Information Service | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of SCI Information Service are -
Skills based hiring in Business Services industry
– The stress on hiring functional specialists at SCI Information Service 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 bargaining power of channel partners in Business Services industry
– because of the regulatory requirements in South Korea, SCI Information Service 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 Business Services industry.
Increasing silos among functional specialists
– The organizational structure of SCI Information Service is dominated by functional specialists. It is not different from other players in the Business Services industry, but SCI Information Service needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help SCI Information Service to focus more on services in the Business Services industry rather than just following the product oriented approach.
Aligning sales with marketing
– From the outside it seems that SCI Information Service needs to have more collaboration between its sales team and marketing team. Sales professionals in the Business Services industry have deep experience in developing customer relationships. Marketing department at SCI Information Service can leverage the sales team experience to cultivate customer relationships as SCI Information Service is planning to shift buying processes online.
Compensation and incentives
– The revenue per employee of SCI Information Service is just above the Business Services 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.
Low market penetration in new markets
– Outside its home market of South Korea, SCI Information Service needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Products dominated business model
– Even though SCI Information Service has some of the most successful models in the Business Services industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. SCI Information Service should strive to include more intangible value offerings along with its core products and services.
Lack of clear differentiation of SCI Information Service products
– To increase the profitability and margins on the products, SCI Information Service needs to provide more differentiated products than what it is currently offering in the marketplace.
Interest costs
– Compare to the competition, SCI Information Service 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.
Employees’ less understanding of SCI Information Service strategy
– From the outside it seems that the employees of SCI Information Service 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
SCI Information Service has a high cash cycle compare to other players in the Business Services industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
SCI Information Service Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of SCI Information Service are -
Manufacturing automation
– SCI Information Service can use the latest technology developments to improve its manufacturing and designing process in Business Services 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.
Buying journey improvements
– SCI Information Service can improve the customer journey of consumers in the Business Services 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Business Services industry, but it has also influenced the consumer preferences. SCI Information Service can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, SCI Information Service can use these opportunities to build new business models that can help the communities that SCI Information Service operates in. Secondly it can use opportunities from government spending in Business Services sector.
Redefining models of collaboration and team work
– As explained in the weaknesses section, SCI Information Service is facing challenges because of the dominance of functional experts in the organization. SCI Information Service can utilize new technology in the field of Business Services industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for SCI Information Service in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Business Services industry, and it will provide faster access to the consumers.
Better consumer reach
– The expansion of the 5G network will help SCI Information Service to increase its market reach. SCI Information Service 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.
Creating value in data economy
– The success of analytics program of SCI Information Service has opened avenues for new revenue streams for the organization in Business Services industry. This can help SCI Information Service to build a more holistic ecosystem for SCI Information Service products in the Business Services industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects SCI Information Service can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Building a culture of innovation
– managers at SCI Information Service 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 Business Services industry.
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. SCI Information Service can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Low interest rates
– Even though inflation is raising its head in most developed economies, SCI Information Service 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.
Leveraging digital technologies
– SCI Information Service can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Threats SCI Information Service External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of SCI Information Service are -
Increasing wage structure of SCI Information Service
– 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 SCI Information Service.
Technology acceleration in Forth Industrial Revolution
– SCI Information Service has witnessed rapid integration of technology during Covid-19 in the Business Services industry. As one of the leading players in the industry, SCI Information Service needs to keep up with the evolution of technology in the Business Services 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.
Environmental challenges
– SCI Information Service 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. SCI Information Service can take advantage of this fund but it will also bring new competitors in the Business Services industry.
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.
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 SCI Information Service.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, SCI Information Service 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 SCI Information Service prominent markets.
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 SCI Information Service business can come under increasing regulations regarding data privacy, data security, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Business Services industry are lowering. It can presents SCI Information Service with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Business Services sector.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, SCI Information Service may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Business Services sector.
High dependence on third party suppliers
– SCI Information Service 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
– SCI Information Service 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 Business Services industry regulations.
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 SCI Information Service in the Business Services 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. SCI Information Service 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.
Weighted SWOT Analysis of SCI Information Service Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at SCI Information Service 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 SCI Information Service 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 SCI Information Service 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 SCI Information Service 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 SCI Information Service needs to make to build a sustainable competitive advantage.