Based on various researches at Oak Spring University , CHS Inc CL Pref is operating in a macro-environment that has been destablized by – talent flight as more people leaving formal jobs, there is backlash against globalization, geopolitical disruptions, increasing household debt because of falling income levels, digital marketing is dominated by two big players Facebook and Google, there is increasing trade war between United States & China, increasing government debt because of Covid-19 spendings,
increasing energy prices, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that CHS Inc CL Pref can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the CHS Inc CL Pref, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which CHS Inc CL Pref 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 CHS Inc CL Pref can be done for the following purposes –
1. Strategic planning of CHS Inc CL Pref
2. Improving business portfolio management of CHS Inc CL Pref
3. Assessing feasibility of the new initiative in United States
4. Making a Crops sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of CHS Inc CL Pref
Strengths of CHS Inc CL Pref | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of CHS Inc CL Pref are -
Superior customer experience
– The customer experience strategy of CHS Inc CL Pref in Crops industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Successful track record of launching new products
– CHS Inc CL Pref has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. CHS Inc CL Pref 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.
Strong track record of project management in the Crops industry
– CHS Inc CL Pref 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 CHS Inc CL Pref 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.
Ability to recruit top talent
– CHS Inc CL Pref is one of the leading players in the Crops 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 CHS Inc CL Pref in the Consumer/Non-Cyclical sector have low bargaining power. CHS Inc CL Pref has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps CHS Inc CL Pref to manage not only supply disruptions but also source products at highly competitive prices.
Organizational Resilience of CHS Inc CL Pref
– The covid-19 pandemic has put organizational resilience at the centre of everthing CHS Inc CL Pref does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Diverse revenue streams
– CHS Inc CL Pref is present in almost all the verticals within the Crops industry. This has provided CHS Inc CL Pref 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.
Learning organization
- CHS Inc CL Pref 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 CHS Inc CL Pref is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at CHS Inc CL Pref emphasize – knowledge, initiative, and innovation.
Effective Research and Development (R&D)
– CHS Inc CL Pref has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – CHS Inc CL Pref staying ahead in the Crops industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Training and development
– CHS Inc CL Pref has one of the best training and development program in Consumer/Non-Cyclical 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.
Highly skilled collaborators
– CHS Inc CL Pref has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Crops industry. Secondly the value chain collaborators of CHS Inc CL Pref have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses of CHS Inc CL Pref | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of CHS Inc CL Pref are -
Need for greater diversity
– CHS Inc CL Pref 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.
No frontier risks strategy
– From the 10K / annual statement of CHS Inc CL Pref, it seems that company is thinking out the frontier risks that can impact Crops 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, CHS Inc CL Pref is slow explore the new channels of communication. These new channels of communication can help CHS Inc CL Pref to provide better information regarding Crops products and services. It can also build an online community to further reach out to potential customers.
Slow to strategic competitive environment developments
– As CHS Inc CL Pref is one of the leading players in the Crops industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Crops industry in last five years.
High operating costs
– Compare to the competitors, CHS Inc CL Pref has high operating costs in the Crops industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract CHS Inc CL Pref lucrative customers.
Slow decision making process
– As mentioned earlier in the report, CHS Inc CL Pref has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Crops industry over the last five years. CHS Inc CL Pref 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.
Interest costs
– Compare to the competition, CHS Inc CL Pref 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.
Capital Spending Reduction
– Even during the low interest decade, CHS Inc CL Pref 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 Crops industry using digital technology.
Increasing silos among functional specialists
– The organizational structure of CHS Inc CL Pref is dominated by functional specialists. It is not different from other players in the Crops industry, but CHS Inc CL Pref needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help CHS Inc CL Pref to focus more on services in the Crops industry rather than just following the product oriented approach.
Products dominated business model
– Even though CHS Inc CL Pref has some of the most successful models in the Crops industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. CHS Inc CL Pref should strive to include more intangible value offerings along with its core products and services.
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 CHS Inc CL Pref supply chain. Even after few cautionary changes, CHS Inc CL Pref is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left CHS Inc CL Pref vulnerable to further global disruptions in South East Asia.
CHS Inc CL Pref Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of CHS Inc CL Pref are -
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Crops industry, but it has also influenced the consumer preferences. CHS Inc CL Pref can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Better consumer reach
– The expansion of the 5G network will help CHS Inc CL Pref to increase its market reach. CHS Inc CL Pref 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects CHS Inc CL Pref can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Buying journey improvements
– CHS Inc CL Pref can improve the customer journey of consumers in the Crops 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, CHS Inc CL Pref 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for CHS Inc CL Pref 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 CHS Inc CL Pref to hire the very best people irrespective of their geographical location.
Lowering marketing communication costs
– 5G expansion will open new opportunities for CHS Inc CL Pref in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Crops industry, and it will provide faster access to the consumers.
Building a culture of innovation
– managers at CHS Inc CL Pref 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 Crops industry.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, CHS Inc CL Pref 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 CHS Inc CL Pref to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Leveraging digital technologies
– CHS Inc CL Pref 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.
Learning at scale
– Online learning technologies has now opened space for CHS Inc CL Pref 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.
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 CHS Inc CL Pref 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.
Use of Bitcoin and other crypto currencies for transactions in Crops industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for CHS Inc CL Pref in the Crops industry. Now CHS Inc CL Pref can target international markets with far fewer capital restrictions requirements than the existing system.
Threats CHS Inc CL Pref External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of CHS Inc CL Pref are -
Consumer confidence and its impact on CHS Inc CL Pref 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 Crops industry and other sectors.
Technology acceleration in Forth Industrial Revolution
– CHS Inc CL Pref has witnessed rapid integration of technology during Covid-19 in the Crops industry. As one of the leading players in the industry, CHS Inc CL Pref needs to keep up with the evolution of technology in the Crops 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.
Regulatory challenges
– CHS Inc CL Pref 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 Crops industry regulations.
Shortening product life cycle
– it is one of the major threat that CHS Inc CL Pref is facing in Crops 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 CHS Inc CL Pref.
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. CHS Inc CL Pref needs to understand the core reasons impacting the Crops industry. This will help it in building a better workplace.
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. CHS Inc CL Pref 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.
Easy access to finance
– Easy access to finance in Crops industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. CHS Inc CL Pref 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 CHS Inc CL Pref business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– CHS Inc CL Pref 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 Crops industry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, CHS Inc CL Pref may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Crops sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, CHS Inc CL Pref 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 CHS Inc CL Pref prominent markets.
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 CHS Inc CL Pref in the Crops sector and impact the bottomline of the organization.
Weighted SWOT Analysis of CHS Inc CL Pref Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at CHS Inc CL Pref 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 CHS Inc CL Pref 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 CHS Inc CL Pref 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 CHS Inc CL Pref 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 CHS Inc CL Pref needs to make to build a sustainable competitive advantage.