Kolen (78650) SWOT Analysis / TOWS Matrix / MBA Resources
Scientific & Technical Instr.
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Kolen (South Korea)
Based on various researches at Oak Spring University , Kolen is operating in a macro-environment that has been destablized by – banking and financial system is disrupted by Bitcoin and other crypto currencies, cloud computing is disrupting traditional business models, increasing government debt because of Covid-19 spendings, increasing household debt because of falling income levels, wage bills are increasing, increasing transportation and logistics costs, technology disruption,
supply chains are disrupted by pandemic , increasing inequality as vast percentage of new income is going to the top 1%, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Kolen can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Kolen, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Kolen 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 Kolen can be done for the following purposes –
1. Strategic planning of Kolen
2. Improving business portfolio management of Kolen
3. Assessing feasibility of the new initiative in South Korea
4. Making a Scientific & Technical Instr. sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Kolen
Strengths of Kolen | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Kolen are -
Ability to lead change in Scientific & Technical Instr.
– Kolen is one of the leading players in the Scientific & Technical Instr. industry in South Korea. Over the years it has not only transformed the business landscape in the Scientific & Technical Instr. industry in South Korea but also across the existing markets. The ability to lead change has enabled Kolen in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Training and development
– Kolen 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.
Operational resilience
– The operational resilience strategy of Kolen comprises – understanding the underlying the factors in the Scientific & Technical Instr. 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.
High brand equity
– Kolen has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Kolen to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– Kolen is one of the most innovative firm in Scientific & Technical Instr. sector.
Successful track record of launching new products
– Kolen has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Kolen 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.
Highly skilled collaborators
– Kolen has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Scientific & Technical Instr. industry. Secondly the value chain collaborators of Kolen have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to recruit top talent
– Kolen is one of the leading players in the Scientific & Technical Instr. 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.
Diverse revenue streams
– Kolen is present in almost all the verticals within the Scientific & Technical Instr. industry. This has provided Kolen 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)
– Kolen has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Kolen staying ahead in the Scientific & Technical Instr. 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 Kolen in the Technology sector have low bargaining power. Kolen has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Kolen to manage not only supply disruptions but also source products at highly competitive prices.
Cross disciplinary teams
– Horizontal connected teams at the Kolen 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.
Weaknesses of Kolen | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Kolen are -
High cash cycle compare to competitors
Kolen has a high cash cycle compare to other players in the Scientific & Technical Instr. industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Compensation and incentives
– The revenue per employee of Kolen is just above the Scientific & Technical Instr. 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.
High dependence on Kolen ‘s star products
– The top 2 products and services of Kolen still accounts for major business revenue. This dependence on star products in Scientific & Technical Instr. industry has resulted into insufficient focus on developing new products, even though Kolen has relatively successful track record of launching new products.
Interest costs
– Compare to the competition, Kolen 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Kolen is slow explore the new channels of communication. These new channels of communication can help Kolen to provide better information regarding Scientific & Technical Instr. products and services. It can also build an online community to further reach out to potential customers.
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 Kolen supply chain. Even after few cautionary changes, Kolen is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Kolen vulnerable to further global disruptions in South East Asia.
High operating costs
– Compare to the competitors, Kolen has high operating costs in the Scientific & Technical Instr. industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Kolen lucrative customers.
Slow decision making process
– As mentioned earlier in the report, Kolen has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Scientific & Technical Instr. industry over the last five years. Kolen 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.
High bargaining power of channel partners in Scientific & Technical Instr. industry
– because of the regulatory requirements in South Korea, Kolen 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 Scientific & Technical Instr. industry.
Aligning sales with marketing
– From the outside it seems that Kolen needs to have more collaboration between its sales team and marketing team. Sales professionals in the Scientific & Technical Instr. industry have deep experience in developing customer relationships. Marketing department at Kolen can leverage the sales team experience to cultivate customer relationships as Kolen is planning to shift buying processes online.
Workers concerns about automation
– As automation is fast increasing in the Scientific & Technical Instr. industry, Kolen 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.
Kolen Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Kolen are -
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 Kolen 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Kolen can use these opportunities to build new business models that can help the communities that Kolen operates in. Secondly it can use opportunities from government spending in Scientific & Technical Instr. sector.
Manufacturing automation
– Kolen can use the latest technology developments to improve its manufacturing and designing process in Scientific & Technical Instr. 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Kolen 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 Kolen to hire the very best people irrespective of their geographical location.
Buying journey improvements
– Kolen can improve the customer journey of consumers in the Scientific & Technical Instr. 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Kolen 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 Kolen to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Use of Bitcoin and other crypto currencies for transactions in Scientific & Technical Instr. industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Kolen in the Scientific & Technical Instr. industry. Now Kolen can target international markets with far fewer capital restrictions requirements than the existing system.
Better consumer reach
– The expansion of the 5G network will help Kolen to increase its market reach. Kolen 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Kolen in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Scientific & Technical Instr. industry, and it will provide faster access to the consumers.
Using analytics as competitive advantage
– Kolen has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Scientific & Technical Instr. sector. This continuous investment in analytics has enabled Kolen to build a competitive advantage using analytics. The analytics driven competitive advantage can help Kolen to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Learning at scale
– Online learning technologies has now opened space for Kolen 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.
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. Kolen can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Loyalty marketing
– Kolen has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Threats Kolen External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Kolen are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Kolen 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 Kolen prominent markets.
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 Kolen 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 Scientific & Technical Instr. industry and other sectors.
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 Kolen in the Scientific & Technical Instr. sector and impact the bottomline of the organization.
Easy access to finance
– Easy access to finance in Scientific & Technical Instr. industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Kolen can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Kolen may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Scientific & Technical Instr. sector.
High dependence on third party suppliers
– Kolen 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
– Kolen 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 Scientific & Technical Instr. industry regulations.
Increasing wage structure of Kolen
– 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 Kolen.
Shortening product life cycle
– it is one of the major threat that Kolen is facing in Scientific & Technical Instr. sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Kolen.
Technology acceleration in Forth Industrial Revolution
– Kolen has witnessed rapid integration of technology during Covid-19 in the Scientific & Technical Instr. industry. As one of the leading players in the industry, Kolen needs to keep up with the evolution of technology in the Scientific & Technical Instr. 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Kolen in Scientific & Technical Instr. industry. The Scientific & Technical Instr. 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.
Weighted SWOT Analysis of Kolen Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Kolen 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 Kolen 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 Kolen 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 Kolen 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 Kolen needs to make to build a sustainable competitive advantage.
