Australian Agricultural (AAC) SWOT Analysis / TOWS Matrix / MBA Resources
Food Processing
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Australian Agricultural (Australia)
Based on various researches at Oak Spring University , Australian Agricultural is operating in a macro-environment that has been destablized by – there is increasing trade war between United States & China, increasing commodity prices, cloud computing is disrupting traditional business models, digital marketing is dominated by two big players Facebook and Google, central banks are concerned over increasing inflation, technology disruption, challanges to central banks by blockchain based private currencies,
customer relationship management is fast transforming because of increasing concerns over data privacy, increasing energy prices, etc
Introduction to SWOT Analysis of Australian Agricultural
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Australian Agricultural can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Australian Agricultural, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Australian Agricultural 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 Australian Agricultural can be done for the following purposes –
1. Strategic planning of Australian Agricultural
2. Improving business portfolio management of Australian Agricultural
3. Assessing feasibility of the new initiative in Australia
4. Making a Food Processing sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Australian Agricultural
Strengths of Australian Agricultural | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Australian Agricultural are -
Operational resilience
– The operational resilience strategy of Australian Agricultural comprises – understanding the underlying the factors in the Food Processing 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.
Low bargaining power of suppliers
– Suppliers of Australian Agricultural in the Consumer/Non-Cyclical sector have low bargaining power. Australian Agricultural has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Australian Agricultural to manage not only supply disruptions but also source products at highly competitive prices.
Ability to lead change in Food Processing
– Australian Agricultural is one of the leading players in the Food Processing industry in Australia. Over the years it has not only transformed the business landscape in the Food Processing industry in Australia but also across the existing markets. The ability to lead change has enabled Australian Agricultural 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 Australian Agricultural 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.
Strong track record of project management in the Food Processing industry
– Australian Agricultural is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High switching costs
– The high switching costs that Australian Agricultural 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.
High brand equity
– Australian Agricultural has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Australian Agricultural to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Highly skilled collaborators
– Australian Agricultural has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Food Processing industry. Secondly the value chain collaborators of Australian Agricultural have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Australian Agricultural is one of the most innovative firm in Food Processing sector.
Successful track record of launching new products
– Australian Agricultural has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Australian Agricultural 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.
Effective Research and Development (R&D)
– Australian Agricultural has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Australian Agricultural staying ahead in the Food Processing industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to recruit top talent
– Australian Agricultural is one of the leading players in the Food Processing industry in Australia. It is in a position to attract the best talent available in Australia. The firm has a robust talent identification program that helps in identifying the brightest.
Weaknesses of Australian Agricultural | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Australian Agricultural are -
High dependence on Australian Agricultural ‘s star products
– The top 2 products and services of Australian Agricultural still accounts for major business revenue. This dependence on star products in Food Processing industry has resulted into insufficient focus on developing new products, even though Australian Agricultural has relatively successful track record of launching new products.
High bargaining power of channel partners in Food Processing industry
– because of the regulatory requirements in Australia, Australian Agricultural 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 Food Processing industry.
Slow to strategic competitive environment developments
– As Australian Agricultural is one of the leading players in the Food Processing industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Food Processing industry in last five years.
Products dominated business model
– Even though Australian Agricultural has some of the most successful models in the Food Processing industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Australian Agricultural should strive to include more intangible value offerings along with its core products and services.
Low market penetration in new markets
– Outside its home market of Australia, Australian Agricultural needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Lack of clear differentiation of Australian Agricultural products
– To increase the profitability and margins on the products, Australian Agricultural needs to provide more differentiated products than what it is currently offering in the marketplace.
Employees’ less understanding of Australian Agricultural strategy
– From the outside it seems that the employees of Australian Agricultural 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.
Slow decision making process
– As mentioned earlier in the report, Australian Agricultural has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Food Processing industry over the last five years. Australian Agricultural 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.
Need for greater diversity
– Australian Agricultural has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Skills based hiring in Food Processing industry
– The stress on hiring functional specialists at Australian Agricultural 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 Australian Agricultural, it seems that company is thinking out the frontier risks that can impact Food Processing 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.
Australian Agricultural Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Australian Agricultural are -
Loyalty marketing
– Australian Agricultural 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Australian Agricultural can use these opportunities to build new business models that can help the communities that Australian Agricultural operates in. Secondly it can use opportunities from government spending in Food Processing sector.
Learning at scale
– Online learning technologies has now opened space for Australian Agricultural 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Australian Agricultural 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 Australian Agricultural to hire the very best people irrespective of their geographical location.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Australian Agricultural in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Food Processing industry, and it will provide faster access to the consumers.
Creating value in data economy
– The success of analytics program of Australian Agricultural has opened avenues for new revenue streams for the organization in Food Processing industry. This can help Australian Agricultural to build a more holistic ecosystem for Australian Agricultural products in the Food Processing 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 Food Processing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Australian Agricultural 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. Australian Agricultural 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.
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 Australian Agricultural 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Australian Agricultural is facing challenges because of the dominance of functional experts in the organization. Australian Agricultural can utilize new technology in the field of Food Processing industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Leveraging digital technologies
– Australian Agricultural 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.
Better consumer reach
– The expansion of the 5G network will help Australian Agricultural to increase its market reach. Australian Agricultural 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Australian Agricultural 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.
Manufacturing automation
– Australian Agricultural can use the latest technology developments to improve its manufacturing and designing process in Food Processing 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.
Threats Australian Agricultural External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Australian Agricultural are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Australian Agricultural in Food Processing industry. The Food Processing 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.
Shortening product life cycle
– it is one of the major threat that Australian Agricultural is facing in Food Processing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Environmental challenges
– Australian Agricultural 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. Australian Agricultural can take advantage of this fund but it will also bring new competitors in the Food Processing industry.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Food Processing industry are lowering. It can presents Australian Agricultural with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Food Processing 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.
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 Australian Agricultural in the Food Processing sector and impact the bottomline of the organization.
Stagnating economy with rate increase
– Australian Agricultural 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 Food Processing industry.
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. Australian Agricultural 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.
High dependence on third party suppliers
– Australian Agricultural 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 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.
Easy access to finance
– Easy access to finance in Food Processing industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Australian Agricultural can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Australian Agricultural 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, Australian Agricultural may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Food Processing sector.
Weighted SWOT Analysis of Australian Agricultural Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Australian Agricultural 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 Australian Agricultural 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 Australian Agricultural 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 Australian Agricultural 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 Australian Agricultural needs to make to build a sustainable competitive advantage.