Based on various researches at Oak Spring University , Gulf Keystone Petroleum ADR is operating in a macro-environment that has been destablized by – competitive advantages are harder to sustain because of technology dispersion, increasing transportation and logistics costs, geopolitical disruptions, digital marketing is dominated by two big players Facebook and Google, supply chains are disrupted by pandemic , there is backlash against globalization, increasing household debt because of falling income levels,
increasing commodity prices, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of Gulf Keystone Petroleum ADR
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Gulf Keystone Petroleum ADR can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Gulf Keystone Petroleum ADR, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Gulf Keystone Petroleum ADR 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 Gulf Keystone Petroleum ADR can be done for the following purposes –
1. Strategic planning of Gulf Keystone Petroleum ADR
2. Improving business portfolio management of Gulf Keystone Petroleum ADR
3. Assessing feasibility of the new initiative in United States
4. Making a sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Gulf Keystone Petroleum ADR
Strengths of Gulf Keystone Petroleum ADR | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Gulf Keystone Petroleum ADR are -
Low bargaining power of suppliers
– Suppliers of Gulf Keystone Petroleum ADR in the sector have low bargaining power. Gulf Keystone Petroleum ADR has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Gulf Keystone Petroleum ADR to manage not only supply disruptions but also source products at highly competitive prices.
High brand equity
– Gulf Keystone Petroleum ADR has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Gulf Keystone Petroleum ADR to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Highly skilled collaborators
– Gulf Keystone Petroleum ADR has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive industry. Secondly the value chain collaborators of Gulf Keystone Petroleum ADR have helped the firm to develop new products and bring them quickly to the marketplace.
Cross disciplinary teams
– Horizontal connected teams at the Gulf Keystone Petroleum ADR 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.
Operational resilience
– The operational resilience strategy of Gulf Keystone Petroleum ADR comprises – understanding the underlying the factors in the 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.
Effective Research and Development (R&D)
– Gulf Keystone Petroleum ADR has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Gulf Keystone Petroleum ADR staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Organizational Resilience of Gulf Keystone Petroleum ADR
– The covid-19 pandemic has put organizational resilience at the centre of everthing Gulf Keystone Petroleum ADR does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High switching costs
– The high switching costs that Gulf Keystone Petroleum ADR 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.
Training and development
– Gulf Keystone Petroleum ADR has one of the best training and development program in 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.
Ability to recruit top talent
– Gulf Keystone Petroleum ADR is one of the leading players in the 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.
Ability to lead change in
– Gulf Keystone Petroleum ADR is one of the leading players in the industry in United States. Over the years it has not only transformed the business landscape in the industry in United States but also across the existing markets. The ability to lead change has enabled Gulf Keystone Petroleum ADR in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Superior customer experience
– The customer experience strategy of Gulf Keystone Petroleum ADR in industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses of Gulf Keystone Petroleum ADR | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Gulf Keystone Petroleum ADR are -
High dependence on Gulf Keystone Petroleum ADR ‘s star products
– The top 2 products and services of Gulf Keystone Petroleum ADR still accounts for major business revenue. This dependence on star products in industry has resulted into insufficient focus on developing new products, even though Gulf Keystone Petroleum ADR has relatively successful track record of launching new products.
Capital Spending Reduction
– Even during the low interest decade, Gulf Keystone Petroleum ADR 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 industry using digital technology.
High bargaining power of channel partners in industry
– because of the regulatory requirements in United States, Gulf Keystone Petroleum ADR 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 industry.
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 Gulf Keystone Petroleum ADR supply chain. Even after few cautionary changes, Gulf Keystone Petroleum ADR is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Gulf Keystone Petroleum ADR vulnerable to further global disruptions in South East Asia.
High cash cycle compare to competitors
Gulf Keystone Petroleum ADR has a high cash cycle compare to other players in the 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 Gulf Keystone Petroleum ADR, in the dynamic environment of industry it has struggled to respond to the nimble upstart competition. Gulf Keystone Petroleum ADR has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Lack of clear differentiation of Gulf Keystone Petroleum ADR products
– To increase the profitability and margins on the products, Gulf Keystone Petroleum ADR needs to provide more differentiated products than what it is currently offering in the marketplace.
Aligning sales with marketing
– From the outside it seems that Gulf Keystone Petroleum ADR needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department at Gulf Keystone Petroleum ADR can leverage the sales team experience to cultivate customer relationships as Gulf Keystone Petroleum ADR is planning to shift buying processes online.
Products dominated business model
– Even though Gulf Keystone Petroleum ADR has some of the most successful models in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Gulf Keystone Petroleum ADR should strive to include more intangible value offerings along with its core products and services.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Gulf Keystone Petroleum ADR is slow explore the new channels of communication. These new channels of communication can help Gulf Keystone Petroleum ADR to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Increasing silos among functional specialists
– The organizational structure of Gulf Keystone Petroleum ADR is dominated by functional specialists. It is not different from other players in the industry, but Gulf Keystone Petroleum ADR needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Gulf Keystone Petroleum ADR to focus more on services in the industry rather than just following the product oriented approach.
Gulf Keystone Petroleum ADR Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Gulf Keystone Petroleum ADR are -
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Gulf Keystone Petroleum ADR 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. Gulf Keystone Petroleum ADR 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.
Creating value in data economy
– The success of analytics program of Gulf Keystone Petroleum ADR has opened avenues for new revenue streams for the organization in industry. This can help Gulf Keystone Petroleum ADR to build a more holistic ecosystem for Gulf Keystone Petroleum ADR products in the 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, Gulf Keystone Petroleum ADR is facing challenges because of the dominance of functional experts in the organization. Gulf Keystone Petroleum ADR can utilize new technology in the field of industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Use of Bitcoin and other crypto currencies for transactions in industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Gulf Keystone Petroleum ADR in the industry. Now Gulf Keystone Petroleum ADR can target international markets with far fewer capital restrictions requirements than the existing system.
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 Gulf Keystone Petroleum ADR 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Gulf Keystone Petroleum ADR can use these opportunities to build new business models that can help the communities that Gulf Keystone Petroleum ADR operates in. Secondly it can use opportunities from government spending in sector.
Loyalty marketing
– Gulf Keystone Petroleum ADR 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.
Manufacturing automation
– Gulf Keystone Petroleum ADR can use the latest technology developments to improve its manufacturing and designing process in 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Gulf Keystone Petroleum ADR can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Developing new processes and practices
– Gulf Keystone Petroleum ADR can develop new processes and procedures in 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Gulf Keystone Petroleum ADR 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 Gulf Keystone Petroleum ADR to hire the very best people irrespective of their geographical location.
Low interest rates
– Even though inflation is raising its head in most developed economies, Gulf Keystone Petroleum ADR 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in industry, but it has also influenced the consumer preferences. Gulf Keystone Petroleum ADR can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats Gulf Keystone Petroleum ADR External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Gulf Keystone Petroleum ADR are -
Technology acceleration in Forth Industrial Revolution
– Gulf Keystone Petroleum ADR has witnessed rapid integration of technology during Covid-19 in the industry. As one of the leading players in the industry, Gulf Keystone Petroleum ADR needs to keep up with the evolution of technology in the 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.
Increasing wage structure of Gulf Keystone Petroleum ADR
– 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 Gulf Keystone Petroleum ADR.
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Gulf Keystone Petroleum ADR 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 Gulf Keystone Petroleum ADR prominent markets.
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 Gulf Keystone Petroleum ADR business can come under increasing regulations regarding data privacy, data security, etc.
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. Gulf Keystone Petroleum ADR 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to industry are lowering. It can presents Gulf Keystone Petroleum ADR with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Gulf Keystone Petroleum ADR in industry. The 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 Gulf Keystone Petroleum ADR is facing in sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, 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.
Stagnating economy with rate increase
– Gulf Keystone Petroleum ADR 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 industry.
Consumer confidence and its impact on Gulf Keystone Petroleum ADR 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 industry and other sectors.
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. Gulf Keystone Petroleum ADR needs to understand the core reasons impacting the industry. This will help it in building a better workplace.
Weighted SWOT Analysis of Gulf Keystone Petroleum ADR Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Gulf Keystone Petroleum ADR 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 Gulf Keystone Petroleum ADR 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 Gulf Keystone Petroleum ADR 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 Gulf Keystone Petroleum ADR 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 Gulf Keystone Petroleum ADR needs to make to build a sustainable competitive advantage.
