Diversicare (DVCR) SWOT Analysis / TOWS Matrix / MBA Resources
Healthcare Facilities
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Diversicare (United States)
Based on various researches at Oak Spring University , Diversicare is operating in a macro-environment that has been destablized by – customer relationship management is fast transforming because of increasing concerns over data privacy, increasing energy prices, increasing household debt because of falling income levels, digital marketing is dominated by two big players Facebook and Google, banking and financial system is disrupted by Bitcoin and other crypto currencies, competitive advantages are harder to sustain because of technology dispersion, increasing government debt because of Covid-19 spendings,
geopolitical disruptions, there is increasing trade war between United States & China, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Diversicare can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Diversicare, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Diversicare 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 Diversicare can be done for the following purposes –
1. Strategic planning of Diversicare
2. Improving business portfolio management of Diversicare
3. Assessing feasibility of the new initiative in United States
4. Making a Healthcare Facilities sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Diversicare
Strengths of Diversicare | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Diversicare are -
Diverse revenue streams
– Diversicare is present in almost all the verticals within the Healthcare Facilities industry. This has provided Diversicare 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.
Strong track record of project management in the Healthcare Facilities industry
– Diversicare is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Learning organization
- Diversicare 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 Diversicare is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Diversicare emphasize – knowledge, initiative, and innovation.
Successful track record of launching new products
– Diversicare has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Diversicare 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.
Ability to lead change in Healthcare Facilities
– Diversicare is one of the leading players in the Healthcare Facilities industry in United States. Over the years it has not only transformed the business landscape in the Healthcare Facilities industry in United States but also across the existing markets. The ability to lead change has enabled Diversicare in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High switching costs
– The high switching costs that Diversicare 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.
Digital Transformation in Healthcare Facilities industry
- digital transformation varies from industry to industry. For Diversicare digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Diversicare 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.
Superior customer experience
– The customer experience strategy of Diversicare in Healthcare Facilities industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Analytics focus
– Diversicare 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 Healthcare Facilities 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.
High brand equity
– Diversicare has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Diversicare to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Highly skilled collaborators
– Diversicare has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Healthcare Facilities industry. Secondly the value chain collaborators of Diversicare have helped the firm to develop new products and bring them quickly to the marketplace.
Low bargaining power of suppliers
– Suppliers of Diversicare in the Healthcare sector have low bargaining power. Diversicare has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Diversicare to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses of Diversicare | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Diversicare are -
High operating costs
– Compare to the competitors, Diversicare has high operating costs in the Healthcare Facilities industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Diversicare lucrative customers.
Slow decision making process
– As mentioned earlier in the report, Diversicare has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Healthcare Facilities industry over the last five years. Diversicare 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Diversicare is slow explore the new channels of communication. These new channels of communication can help Diversicare to provide better information regarding Healthcare Facilities products and services. It can also build an online community to further reach out to potential customers.
Lack of clear differentiation of Diversicare products
– To increase the profitability and margins on the products, Diversicare needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to strategic competitive environment developments
– As Diversicare is one of the leading players in the Healthcare Facilities industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Healthcare Facilities industry in last five years.
Low market penetration in new markets
– Outside its home market of United States, Diversicare needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Aligning sales with marketing
– From the outside it seems that Diversicare needs to have more collaboration between its sales team and marketing team. Sales professionals in the Healthcare Facilities industry have deep experience in developing customer relationships. Marketing department at Diversicare can leverage the sales team experience to cultivate customer relationships as Diversicare is planning to shift buying processes online.
Increasing silos among functional specialists
– The organizational structure of Diversicare is dominated by functional specialists. It is not different from other players in the Healthcare Facilities industry, but Diversicare needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Diversicare to focus more on services in the Healthcare Facilities industry rather than just following the product oriented approach.
No frontier risks strategy
– From the 10K / annual statement of Diversicare, it seems that company is thinking out the frontier risks that can impact Healthcare Facilities 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.
Workers concerns about automation
– As automation is fast increasing in the Healthcare Facilities industry, Diversicare 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.
Ability to respond to the competition
– As the decision making is very deliberative at Diversicare, in the dynamic environment of Healthcare Facilities industry it has struggled to respond to the nimble upstart competition. Diversicare has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Diversicare Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Diversicare are -
Learning at scale
– Online learning technologies has now opened space for Diversicare 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Healthcare Facilities industry, but it has also influenced the consumer preferences. Diversicare 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
– Diversicare can develop new processes and procedures in Healthcare Facilities 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 Diversicare can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Building a culture of innovation
– managers at Diversicare 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 Healthcare Facilities industry.
Creating value in data economy
– The success of analytics program of Diversicare has opened avenues for new revenue streams for the organization in Healthcare Facilities industry. This can help Diversicare to build a more holistic ecosystem for Diversicare products in the Healthcare Facilities 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, Diversicare is facing challenges because of the dominance of functional experts in the organization. Diversicare can utilize new technology in the field of Healthcare Facilities industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Better consumer reach
– The expansion of the 5G network will help Diversicare to increase its market reach. Diversicare 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, Diversicare 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.
Use of Bitcoin and other crypto currencies for transactions in Healthcare Facilities industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Diversicare in the Healthcare Facilities industry. Now Diversicare can target international markets with far fewer capital restrictions requirements than the existing system.
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. Diversicare can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Manufacturing automation
– Diversicare can use the latest technology developments to improve its manufacturing and designing process in Healthcare Facilities 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Diversicare can use these opportunities to build new business models that can help the communities that Diversicare operates in. Secondly it can use opportunities from government spending in Healthcare Facilities sector.
Threats Diversicare External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Diversicare are -
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. Diversicare 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.
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 Diversicare in the Healthcare Facilities sector and impact the bottomline of the organization.
Easy access to finance
– Easy access to finance in Healthcare Facilities industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Diversicare 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 Diversicare
– 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 Diversicare.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Diversicare may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Healthcare Facilities sector.
Environmental challenges
– Diversicare 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. Diversicare can take advantage of this fund but it will also bring new competitors in the Healthcare Facilities industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Diversicare 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 Diversicare prominent markets.
Regulatory challenges
– Diversicare 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 Healthcare Facilities industry regulations.
Consumer confidence and its impact on Diversicare 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 Healthcare Facilities industry and other sectors.
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 Diversicare business can come under increasing regulations regarding data privacy, data security, etc.
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.
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 Diversicare.
Shortening product life cycle
– it is one of the major threat that Diversicare is facing in Healthcare Facilities sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Diversicare Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Diversicare 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 Diversicare 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 Diversicare 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 Diversicare 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 Diversicare needs to make to build a sustainable competitive advantage.
