Amadeus IT Holding SA PK (AMADY) SWOT Analysis / TOWS Matrix / MBA Resources
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Amadeus IT Holding SA PK (United States)
Based on various researches at Oak Spring University , Amadeus IT Holding SA PK is operating in a macro-environment that has been destablized by – challanges to central banks by blockchain based private currencies, increasing government debt because of Covid-19 spendings, technology disruption, talent flight as more people leaving formal jobs, increasing inequality as vast percentage of new income is going to the top 1%, wage bills are increasing, digital marketing is dominated by two big players Facebook and Google,
competitive advantages are harder to sustain because of technology dispersion, increasing energy prices, etc
Introduction to SWOT Analysis of Amadeus IT Holding SA PK
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Amadeus IT Holding SA PK can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Amadeus IT Holding SA PK, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Amadeus IT Holding SA PK 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 Amadeus IT Holding SA PK can be done for the following purposes –
1. Strategic planning of Amadeus IT Holding SA PK
2. Improving business portfolio management of Amadeus IT Holding SA PK
3. Assessing feasibility of the new initiative in United States
4. Making a sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Amadeus IT Holding SA PK
Strengths of Amadeus IT Holding SA PK | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Amadeus IT Holding SA PK are -
Innovation driven organization
– Amadeus IT Holding SA PK is one of the most innovative firm in sector.
High brand equity
– Amadeus IT Holding SA PK has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Amadeus IT Holding SA PK to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Amadeus IT Holding SA PK is present in almost all the verticals within the industry. This has provided Amadeus IT Holding SA PK a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Successful track record of launching new products
– Amadeus IT Holding SA PK has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Amadeus IT Holding SA PK 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.
Organizational Resilience of Amadeus IT Holding SA PK
– The covid-19 pandemic has put organizational resilience at the centre of everthing Amadeus IT Holding SA PK does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Amadeus IT Holding SA PK is one of the leading players in the industry in United States. It is in a position to attract the best talent available in United States. The firm has a robust talent identification program that helps in identifying the brightest.
Low bargaining power of suppliers
– Suppliers of Amadeus IT Holding SA PK in the sector have low bargaining power. Amadeus IT Holding SA PK has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Amadeus IT Holding SA PK to manage not only supply disruptions but also source products at highly competitive prices.
Strong track record of project management in the industry
– Amadeus IT Holding SA PK is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to lead change in
– Amadeus IT Holding SA PK is one of the leading players in the industry in United States. Over the years it has not only transformed the business landscape in the industry in United States but also across the existing markets. The ability to lead change has enabled Amadeus IT Holding SA PK in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Sustainable margins compare to other players in industry
– Amadeus IT Holding SA PK has clearly differentiated products in the market place. This has enabled Amadeus IT Holding SA PK to fetch slight price premium compare to the competitors in the industry. The sustainable margins have also helped Amadeus IT Holding SA PK to invest into research and development (R&D) and innovation.
Learning organization
- Amadeus IT Holding SA PK 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 Amadeus IT Holding SA PK is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Amadeus IT Holding SA PK emphasize – knowledge, initiative, and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Amadeus IT Holding SA PK 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 Amadeus IT Holding SA PK | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Amadeus IT Holding SA PK are -
Low market penetration in new markets
– Outside its home market of United States, Amadeus IT Holding SA PK needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Ability to respond to the competition
– As the decision making is very deliberative at Amadeus IT Holding SA PK, in the dynamic environment of industry it has struggled to respond to the nimble upstart competition. Amadeus IT Holding SA PK has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Capital Spending Reduction
– Even during the low interest decade, Amadeus IT Holding SA PK 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 industry using digital technology.
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 Amadeus IT Holding SA PK supply chain. Even after few cautionary changes, Amadeus IT Holding SA PK is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Amadeus IT Holding SA PK vulnerable to further global disruptions in South East Asia.
High operating costs
– Compare to the competitors, Amadeus IT Holding SA PK has high operating costs in the industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Amadeus IT Holding SA PK lucrative customers.
Compensation and incentives
– The revenue per employee of Amadeus IT Holding SA PK is just above the 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 decision making process
– As mentioned earlier in the report, Amadeus IT Holding SA PK has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Amadeus IT Holding SA PK 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.
Aligning sales with marketing
– From the outside it seems that Amadeus IT Holding SA PK needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department at Amadeus IT Holding SA PK can leverage the sales team experience to cultivate customer relationships as Amadeus IT Holding SA PK is planning to shift buying processes online.
Skills based hiring in industry
– The stress on hiring functional specialists at Amadeus IT Holding SA PK 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.
No frontier risks strategy
– From the 10K / annual statement of Amadeus IT Holding SA PK, it seems that company is thinking out the frontier risks that can impact industry. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Increasing silos among functional specialists
– The organizational structure of Amadeus IT Holding SA PK is dominated by functional specialists. It is not different from other players in the industry, but Amadeus IT Holding SA PK needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Amadeus IT Holding SA PK to focus more on services in the industry rather than just following the product oriented approach.
Amadeus IT Holding SA PK Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Amadeus IT Holding SA PK are -
Better consumer reach
– The expansion of the 5G network will help Amadeus IT Holding SA PK to increase its market reach. Amadeus IT Holding SA PK 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.
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 Amadeus IT Holding SA PK 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in industry, but it has also influenced the consumer preferences. Amadeus IT Holding SA PK can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Developing new processes and practices
– Amadeus IT Holding SA PK can develop new processes and procedures in 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Amadeus IT Holding SA PK can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Low interest rates
– Even though inflation is raising its head in most developed economies, Amadeus IT Holding SA PK 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.
Buying journey improvements
– Amadeus IT Holding SA PK can improve the customer journey of consumers in the 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.
Manufacturing automation
– Amadeus IT Holding SA PK can use the latest technology developments to improve its manufacturing and designing process in 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 Amadeus IT Holding SA PK 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 Amadeus IT Holding SA PK to hire the very best people irrespective of their geographical location.
Creating value in data economy
– The success of analytics program of Amadeus IT Holding SA PK has opened avenues for new revenue streams for the organization in industry. This can help Amadeus IT Holding SA PK to build a more holistic ecosystem for Amadeus IT Holding SA PK products in the industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Learning at scale
– Online learning technologies has now opened space for Amadeus IT Holding SA PK 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.
Using analytics as competitive advantage
– Amadeus IT Holding SA PK has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in sector. This continuous investment in analytics has enabled Amadeus IT Holding SA PK to build a competitive advantage using analytics. The analytics driven competitive advantage can help Amadeus IT Holding SA PK to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Amadeus IT Holding SA PK can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats Amadeus IT Holding SA PK External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Amadeus IT Holding SA PK are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to industry are lowering. It can presents Amadeus IT Holding SA PK with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
Regulatory challenges
– Amadeus IT Holding SA PK 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 industry regulations.
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 Amadeus IT Holding SA PK business can come under increasing regulations regarding data privacy, data security, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Amadeus IT Holding SA PK may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of sector.
High dependence on third party suppliers
– Amadeus IT Holding SA PK 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.
Technology acceleration in Forth Industrial Revolution
– Amadeus IT Holding SA PK has witnessed rapid integration of technology during Covid-19 in the industry. As one of the leading players in the industry, Amadeus IT Holding SA PK needs to keep up with the evolution of technology in the 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.
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. Amadeus IT Holding SA PK needs to understand the core reasons impacting the industry. This will help it in building a better workplace.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Amadeus IT Holding SA PK 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 Amadeus IT Holding SA PK prominent markets.
Shortening product life cycle
– it is one of the major threat that Amadeus IT Holding SA PK is facing in sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Easy access to finance
– Easy access to finance in industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Amadeus IT Holding SA PK 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 Amadeus IT Holding SA PK in the sector and impact the bottomline 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 Amadeus IT Holding SA PK in industry. The 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 Amadeus IT Holding SA PK Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Amadeus IT Holding SA PK 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 Amadeus IT Holding SA PK 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 Amadeus IT Holding SA PK 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 Amadeus IT Holding SA PK 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 Amadeus IT Holding SA PK needs to make to build a sustainable competitive advantage.