Based on various researches at Oak Spring University , Physicians Realty Trust is operating in a macro-environment that has been destablized by – increasing government debt because of Covid-19 spendings, geopolitical disruptions, there is increasing trade war between United States & China, increasing transportation and logistics costs, banking and financial system is disrupted by Bitcoin and other crypto currencies, technology disruption, increasing energy prices,
challanges to central banks by blockchain based private currencies, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Physicians Realty Trust
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Physicians Realty Trust can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Physicians Realty Trust, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Physicians Realty Trust 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 Physicians Realty Trust can be done for the following purposes –
1. Strategic planning of Physicians Realty Trust
2. Improving business portfolio management of Physicians Realty Trust
3. Assessing feasibility of the new initiative in United States
4. Making a Real Estate Operations sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Physicians Realty Trust
Strengths of Physicians Realty Trust | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Physicians Realty Trust are -
Organizational Resilience of Physicians Realty Trust
– The covid-19 pandemic has put organizational resilience at the centre of everthing Physicians Realty Trust does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Highly skilled collaborators
– Physicians Realty Trust has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Real Estate Operations industry. Secondly the value chain collaborators of Physicians Realty Trust have helped the firm to develop new products and bring them quickly to the marketplace.
Analytics focus
– Physicians Realty Trust is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the Real Estate Operations industry. The technology infrastructure of United States is also helping it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Diverse revenue streams
– Physicians Realty Trust is present in almost all the verticals within the Real Estate Operations industry. This has provided Physicians Realty Trust 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.
Cross disciplinary teams
– Horizontal connected teams at the Physicians Realty Trust 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.
Training and development
– Physicians Realty Trust has one of the best training and development program in Services 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.
Low bargaining power of suppliers
– Suppliers of Physicians Realty Trust in the Services sector have low bargaining power. Physicians Realty Trust has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Physicians Realty Trust to manage not only supply disruptions but also source products at highly competitive prices.
Operational resilience
– The operational resilience strategy of Physicians Realty Trust comprises – understanding the underlying the factors in the Real Estate Operations 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.
Digital Transformation in Real Estate Operations industry
- digital transformation varies from industry to industry. For Physicians Realty Trust digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Physicians Realty Trust has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Innovation driven organization
– Physicians Realty Trust is one of the most innovative firm in Real Estate Operations sector.
High brand equity
– Physicians Realty Trust has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Physicians Realty Trust to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to lead change in Real Estate Operations
– Physicians Realty Trust is one of the leading players in the Real Estate Operations industry in United States. Over the years it has not only transformed the business landscape in the Real Estate Operations industry in United States but also across the existing markets. The ability to lead change has enabled Physicians Realty Trust in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Weaknesses of Physicians Realty Trust | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Physicians Realty Trust are -
Lack of clear differentiation of Physicians Realty Trust products
– To increase the profitability and margins on the products, Physicians Realty Trust needs to provide more differentiated products than what it is currently offering in the marketplace.
Low market penetration in new markets
– Outside its home market of United States, Physicians Realty Trust needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High operating costs
– Compare to the competitors, Physicians Realty Trust has high operating costs in the Real Estate Operations industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Physicians Realty Trust lucrative customers.
High bargaining power of channel partners in Real Estate Operations industry
– because of the regulatory requirements in United States, Physicians Realty Trust 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 Real Estate Operations industry.
Employees’ less understanding of Physicians Realty Trust strategy
– From the outside it seems that the employees of Physicians Realty Trust 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.
Capital Spending Reduction
– Even during the low interest decade, Physicians Realty Trust 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 Real Estate Operations industry using digital technology.
No frontier risks strategy
– From the 10K / annual statement of Physicians Realty Trust, it seems that company is thinking out the frontier risks that can impact Real Estate Operations 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.
Compensation and incentives
– The revenue per employee of Physicians Realty Trust is just above the Real Estate Operations 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 Physicians Realty Trust ‘s star products
– The top 2 products and services of Physicians Realty Trust still accounts for major business revenue. This dependence on star products in Real Estate Operations industry has resulted into insufficient focus on developing new products, even though Physicians Realty Trust has relatively successful track record of launching new products.
Aligning sales with marketing
– From the outside it seems that Physicians Realty Trust needs to have more collaboration between its sales team and marketing team. Sales professionals in the Real Estate Operations industry have deep experience in developing customer relationships. Marketing department at Physicians Realty Trust can leverage the sales team experience to cultivate customer relationships as Physicians Realty Trust is planning to shift buying processes online.
Increasing silos among functional specialists
– The organizational structure of Physicians Realty Trust is dominated by functional specialists. It is not different from other players in the Real Estate Operations industry, but Physicians Realty Trust needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Physicians Realty Trust to focus more on services in the Real Estate Operations industry rather than just following the product oriented approach.
Physicians Realty Trust Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Physicians Realty Trust are -
Manufacturing automation
– Physicians Realty Trust can use the latest technology developments to improve its manufacturing and designing process in Real Estate Operations 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.
Developing new processes and practices
– Physicians Realty Trust can develop new processes and procedures in Real Estate Operations 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, Physicians Realty Trust can use these opportunities to build new business models that can help the communities that Physicians Realty Trust operates in. Secondly it can use opportunities from government spending in Real Estate Operations sector.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Physicians Realty Trust in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Real Estate Operations industry, and it will provide faster access to the consumers.
Loyalty marketing
– Physicians Realty Trust 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Physicians Realty Trust 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 Physicians Realty Trust to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Building a culture of innovation
– managers at Physicians Realty Trust 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 Real Estate Operations industry.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Real Estate Operations industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Physicians Realty Trust 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. Physicians Realty Trust 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Physicians Realty Trust can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Creating value in data economy
– The success of analytics program of Physicians Realty Trust has opened avenues for new revenue streams for the organization in Real Estate Operations industry. This can help Physicians Realty Trust to build a more holistic ecosystem for Physicians Realty Trust products in the Real Estate Operations industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Physicians Realty Trust is facing challenges because of the dominance of functional experts in the organization. Physicians Realty Trust can utilize new technology in the field of Real Estate Operations industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Buying journey improvements
– Physicians Realty Trust can improve the customer journey of consumers in the Real Estate Operations 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Real Estate Operations industry, but it has also influenced the consumer preferences. Physicians Realty Trust can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats Physicians Realty Trust External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Physicians Realty Trust are -
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.
Stagnating economy with rate increase
– Physicians Realty Trust 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 Real Estate Operations industry.
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.
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. Physicians Realty Trust 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.
Environmental challenges
– Physicians Realty Trust 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. Physicians Realty Trust can take advantage of this fund but it will also bring new competitors in the Real Estate Operations industry.
Easy access to finance
– Easy access to finance in Real Estate Operations industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Physicians Realty Trust can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing wage structure of Physicians Realty Trust
– 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 Physicians Realty Trust.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Physicians Realty Trust 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 Physicians Realty Trust 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 Physicians Realty Trust in the Real Estate Operations sector and impact the bottomline of the organization.
Consumer confidence and its impact on Physicians Realty Trust 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 Real Estate Operations industry and other sectors.
Technology acceleration in Forth Industrial Revolution
– Physicians Realty Trust has witnessed rapid integration of technology during Covid-19 in the Real Estate Operations industry. As one of the leading players in the industry, Physicians Realty Trust needs to keep up with the evolution of technology in the Real Estate Operations 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.
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 Physicians Realty Trust.
Shortening product life cycle
– it is one of the major threat that Physicians Realty Trust is facing in Real Estate Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Physicians Realty Trust Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Physicians Realty Trust 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 Physicians Realty Trust 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 Physicians Realty Trust 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 Physicians Realty Trust 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 Physicians Realty Trust needs to make to build a sustainable competitive advantage.