SWOT Analysis / TOWS Matrix for Ardmore Shpng (United States)
Based on various researches at Oak Spring University , Ardmore Shpng is operating in a macro-environment that has been destablized by – supply chains are disrupted by pandemic , increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies, increasing government debt because of Covid-19 spendings, geopolitical disruptions, cloud computing is disrupting traditional business models, competitive advantages are harder to sustain because of technology dispersion,
increasing household debt because of falling income levels, digital marketing is dominated by two big players Facebook and Google, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Ardmore Shpng can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Ardmore Shpng, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Ardmore Shpng 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 Ardmore Shpng can be done for the following purposes –
1. Strategic planning of Ardmore Shpng
2. Improving business portfolio management of Ardmore Shpng
3. Assessing feasibility of the new initiative in United States
4. Making a Water Transportation sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Ardmore Shpng
Strengths of Ardmore Shpng | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Ardmore Shpng are -
Diverse revenue streams
– Ardmore Shpng is present in almost all the verticals within the Water Transportation industry. This has provided Ardmore Shpng 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.
Superior customer experience
– The customer experience strategy of Ardmore Shpng in Water Transportation industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High brand equity
– Ardmore Shpng has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Ardmore Shpng to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
High switching costs
– The high switching costs that Ardmore Shpng 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.
Sustainable margins compare to other players in Water Transportation industry
– Ardmore Shpng has clearly differentiated products in the market place. This has enabled Ardmore Shpng to fetch slight price premium compare to the competitors in the Water Transportation industry. The sustainable margins have also helped Ardmore Shpng to invest into research and development (R&D) and innovation.
Operational resilience
– The operational resilience strategy of Ardmore Shpng comprises – understanding the underlying the factors in the Water Transportation 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.
Successful track record of launching new products
– Ardmore Shpng has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Ardmore Shpng 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.
Innovation driven organization
– Ardmore Shpng is one of the most innovative firm in Water Transportation sector.
Strong track record of project management in the Water Transportation industry
– Ardmore Shpng is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Low bargaining power of suppliers
– Suppliers of Ardmore Shpng in the Transportation sector have low bargaining power. Ardmore Shpng has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Ardmore Shpng to manage not only supply disruptions but also source products at highly competitive prices.
Cross disciplinary teams
– Horizontal connected teams at the Ardmore Shpng 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.
Learning organization
- Ardmore Shpng 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 Ardmore Shpng is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Ardmore Shpng emphasize – knowledge, initiative, and innovation.
Weaknesses of Ardmore Shpng | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Ardmore Shpng are -
High bargaining power of channel partners in Water Transportation industry
– because of the regulatory requirements in United States, Ardmore Shpng 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 Water Transportation industry.
Skills based hiring in Water Transportation industry
– The stress on hiring functional specialists at Ardmore Shpng 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.
Low market penetration in new markets
– Outside its home market of United States, Ardmore Shpng needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Ardmore Shpng is slow explore the new channels of communication. These new channels of communication can help Ardmore Shpng to provide better information regarding Water Transportation products and services. It can also build an online community to further reach out to potential customers.
Workers concerns about automation
– As automation is fast increasing in the Water Transportation industry, Ardmore Shpng 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.
High operating costs
– Compare to the competitors, Ardmore Shpng has high operating costs in the Water Transportation industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Ardmore Shpng lucrative customers.
Interest costs
– Compare to the competition, Ardmore Shpng 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.
Compensation and incentives
– The revenue per employee of Ardmore Shpng is just above the Water Transportation 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.
Aligning sales with marketing
– From the outside it seems that Ardmore Shpng needs to have more collaboration between its sales team and marketing team. Sales professionals in the Water Transportation industry have deep experience in developing customer relationships. Marketing department at Ardmore Shpng can leverage the sales team experience to cultivate customer relationships as Ardmore Shpng is planning to shift buying processes online.
High cash cycle compare to competitors
Ardmore Shpng has a high cash cycle compare to other players in the Water Transportation industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Ability to respond to the competition
– As the decision making is very deliberative at Ardmore Shpng, in the dynamic environment of Water Transportation industry it has struggled to respond to the nimble upstart competition. Ardmore Shpng has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Ardmore Shpng Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Ardmore Shpng are -
Creating value in data economy
– The success of analytics program of Ardmore Shpng has opened avenues for new revenue streams for the organization in Water Transportation industry. This can help Ardmore Shpng to build a more holistic ecosystem for Ardmore Shpng products in the Water Transportation industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Water Transportation industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Ardmore Shpng 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. Ardmore Shpng 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.
Use of Bitcoin and other crypto currencies for transactions in Water Transportation industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Ardmore Shpng in the Water Transportation industry. Now Ardmore Shpng can target international markets with far fewer capital restrictions requirements than the existing system.
Low interest rates
– Even though inflation is raising its head in most developed economies, Ardmore Shpng 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.
Learning at scale
– Online learning technologies has now opened space for Ardmore Shpng 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.
Buying journey improvements
– Ardmore Shpng can improve the customer journey of consumers in the Water Transportation 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.
Developing new processes and practices
– Ardmore Shpng can develop new processes and procedures in Water Transportation 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Ardmore Shpng can use these opportunities to build new business models that can help the communities that Ardmore Shpng operates in. Secondly it can use opportunities from government spending in Water Transportation sector.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Ardmore Shpng 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 Ardmore Shpng to hire the very best people irrespective of their geographical location.
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. Ardmore Shpng can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Ardmore Shpng 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 Ardmore Shpng to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Ardmore Shpng can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Ardmore Shpng is facing challenges because of the dominance of functional experts in the organization. Ardmore Shpng can utilize new technology in the field of Water Transportation industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Threats Ardmore Shpng External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Ardmore Shpng are -
Easy access to finance
– Easy access to finance in Water Transportation industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Ardmore Shpng 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 Ardmore Shpng in the Water Transportation sector and impact the bottomline of the organization.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Ardmore Shpng may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Water Transportation sector.
Technology acceleration in Forth Industrial Revolution
– Ardmore Shpng has witnessed rapid integration of technology during Covid-19 in the Water Transportation industry. As one of the leading players in the industry, Ardmore Shpng needs to keep up with the evolution of technology in the Water Transportation 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Water Transportation industry are lowering. It can presents Ardmore Shpng with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Water Transportation sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Ardmore Shpng 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 Ardmore Shpng prominent markets.
Regulatory challenges
– Ardmore Shpng 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 Water Transportation industry regulations.
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. Ardmore Shpng needs to understand the core reasons impacting the Water Transportation industry. This will help it in building a better workplace.
Stagnating economy with rate increase
– Ardmore Shpng 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 Water Transportation industry.
Consumer confidence and its impact on Ardmore Shpng 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 Water Transportation industry and other sectors.
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.
Environmental challenges
– Ardmore Shpng 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. Ardmore Shpng can take advantage of this fund but it will also bring new competitors in the Water Transportation industry.
Increasing wage structure of Ardmore Shpng
– 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 Ardmore Shpng.
Weighted SWOT Analysis of Ardmore Shpng Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Ardmore Shpng 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 Ardmore Shpng 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 Ardmore Shpng 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 Ardmore Shpng 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 Ardmore Shpng needs to make to build a sustainable competitive advantage.
