Goldman Sachs Group Inc Pd ADR (GS_pd) SWOT Analysis / TOWS Matrix / MBA Resources
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Goldman Sachs Group Inc Pd ADR (United States)
Based on various researches at Oak Spring University , Goldman Sachs Group Inc Pd ADR 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 household debt because of falling income levels, challanges to central banks by blockchain based private currencies, competitive advantages are harder to sustain because of technology dispersion, increasing government debt because of Covid-19 spendings, talent flight as more people leaving formal jobs, cloud computing is disrupting traditional business models,
increasing inequality as vast percentage of new income is going to the top 1%, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of Goldman Sachs Group Inc Pd ADR
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Goldman Sachs Group Inc Pd ADR can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Goldman Sachs Group Inc Pd ADR, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Goldman Sachs Group Inc Pd 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 Goldman Sachs Group Inc Pd ADR can be done for the following purposes –
1. Strategic planning of Goldman Sachs Group Inc Pd ADR
2. Improving business portfolio management of Goldman Sachs Group Inc Pd 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 Goldman Sachs Group Inc Pd ADR
Strengths of Goldman Sachs Group Inc Pd ADR | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Goldman Sachs Group Inc Pd ADR are -
Successful track record of launching new products
– Goldman Sachs Group Inc Pd ADR has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Goldman Sachs Group Inc Pd ADR 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.
Sustainable margins compare to other players in industry
– Goldman Sachs Group Inc Pd ADR has clearly differentiated products in the market place. This has enabled Goldman Sachs Group Inc Pd ADR to fetch slight price premium compare to the competitors in the industry. The sustainable margins have also helped Goldman Sachs Group Inc Pd ADR to invest into research and development (R&D) and innovation.
High switching costs
– The high switching costs that Goldman Sachs Group Inc Pd 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.
Operational resilience
– The operational resilience strategy of Goldman Sachs Group Inc Pd 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.
Strong track record of project management in the industry
– Goldman Sachs Group Inc Pd ADR is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Analytics focus
– Goldman Sachs Group Inc Pd ADR 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 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.
Learning organization
- Goldman Sachs Group Inc Pd ADR 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 Goldman Sachs Group Inc Pd ADR is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Goldman Sachs Group Inc Pd ADR emphasize – knowledge, initiative, and innovation.
Ability to lead change in
– Goldman Sachs Group Inc Pd 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 Goldman Sachs Group Inc Pd ADR in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Ability to recruit top talent
– Goldman Sachs Group Inc Pd 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.
Low bargaining power of suppliers
– Suppliers of Goldman Sachs Group Inc Pd ADR in the sector have low bargaining power. Goldman Sachs Group Inc Pd ADR has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Goldman Sachs Group Inc Pd ADR to manage not only supply disruptions but also source products at highly competitive prices.
Organizational Resilience of Goldman Sachs Group Inc Pd ADR
– The covid-19 pandemic has put organizational resilience at the centre of everthing Goldman Sachs Group Inc Pd ADR does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– Goldman Sachs Group Inc Pd 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.
Weaknesses of Goldman Sachs Group Inc Pd ADR | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Goldman Sachs Group Inc Pd ADR are -
Ability to respond to the competition
– As the decision making is very deliberative at Goldman Sachs Group Inc Pd ADR, in the dynamic environment of industry it has struggled to respond to the nimble upstart competition. Goldman Sachs Group Inc Pd ADR has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to strategic competitive environment developments
– As Goldman Sachs Group Inc Pd ADR is one of the leading players in the industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Low market penetration in new markets
– Outside its home market of United States, Goldman Sachs Group Inc Pd ADR needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High dependence on Goldman Sachs Group Inc Pd ADR ‘s star products
– The top 2 products and services of Goldman Sachs Group Inc Pd 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 Goldman Sachs Group Inc Pd ADR has relatively successful track record of launching new products.
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 Goldman Sachs Group Inc Pd ADR supply chain. Even after few cautionary changes, Goldman Sachs Group Inc Pd ADR is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Goldman Sachs Group Inc Pd ADR vulnerable to further global disruptions in South East Asia.
High cash cycle compare to competitors
Goldman Sachs Group Inc Pd 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.
No frontier risks strategy
– From the 10K / annual statement of Goldman Sachs Group Inc Pd ADR, it seems that company is thinking out the frontier risks that can impact 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.
Capital Spending Reduction
– Even during the low interest decade, Goldman Sachs Group Inc Pd 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.
Slow decision making process
– As mentioned earlier in the report, Goldman Sachs Group Inc Pd ADR has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Goldman Sachs Group Inc Pd ADR 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.
High bargaining power of channel partners in industry
– because of the regulatory requirements in United States, Goldman Sachs Group Inc Pd 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.
Interest costs
– Compare to the competition, Goldman Sachs Group Inc Pd ADR 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.
Goldman Sachs Group Inc Pd ADR Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Goldman Sachs Group Inc Pd ADR are -
Buying journey improvements
– Goldman Sachs Group Inc Pd ADR can improve the customer journey of consumers in the 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Goldman Sachs Group Inc Pd ADR can use these opportunities to build new business models that can help the communities that Goldman Sachs Group Inc Pd ADR operates in. Secondly it can use opportunities from government spending in sector.
Building a culture of innovation
– managers at Goldman Sachs Group Inc Pd ADR 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 industry.
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. Goldman Sachs Group Inc Pd ADR can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Goldman Sachs Group Inc Pd ADR is facing challenges because of the dominance of functional experts in the organization. Goldman Sachs Group Inc Pd 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.
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. Goldman Sachs Group Inc Pd 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. Goldman Sachs Group Inc Pd 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.
Leveraging digital technologies
– Goldman Sachs Group Inc Pd ADR 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.
Using analytics as competitive advantage
– Goldman Sachs Group Inc Pd ADR has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in sector. This continuous investment in analytics has enabled Goldman Sachs Group Inc Pd ADR to build a competitive advantage using analytics. The analytics driven competitive advantage can help Goldman Sachs Group Inc Pd ADR to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Creating value in data economy
– The success of analytics program of Goldman Sachs Group Inc Pd ADR has opened avenues for new revenue streams for the organization in industry. This can help Goldman Sachs Group Inc Pd ADR to build a more holistic ecosystem for Goldman Sachs Group Inc Pd ADR products in the industry by providing – data insight services, data privacy related products, data based consulting services, 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 Goldman Sachs Group Inc Pd ADR in the industry. Now Goldman Sachs Group Inc Pd ADR can target international markets with far fewer capital restrictions requirements than the existing system.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Goldman Sachs Group Inc Pd ADR in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the industry, and it will provide faster access to the consumers.
Manufacturing automation
– Goldman Sachs Group Inc Pd 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 Goldman Sachs Group Inc Pd ADR can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Goldman Sachs Group Inc Pd ADR External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Goldman Sachs Group Inc Pd ADR 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.
Easy access to finance
– Easy access to finance in industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Goldman Sachs Group Inc Pd ADR can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Goldman Sachs Group Inc Pd 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.
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 Goldman Sachs Group Inc Pd 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.
Technology acceleration in Forth Industrial Revolution
– Goldman Sachs Group Inc Pd ADR has witnessed rapid integration of technology during Covid-19 in the industry. As one of the leading players in the industry, Goldman Sachs Group Inc Pd 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.
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. Goldman Sachs Group Inc Pd ADR needs to understand the core reasons impacting the industry. This will help it in building a better workplace.
Stagnating economy with rate increase
– Goldman Sachs Group Inc Pd 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 Goldman Sachs Group Inc Pd 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.
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 Goldman Sachs Group Inc Pd ADR in the sector and impact the bottomline of the organization.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to industry are lowering. It can presents Goldman Sachs Group Inc Pd ADR with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Environmental challenges
– Goldman Sachs Group Inc Pd ADR 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. Goldman Sachs Group Inc Pd ADR can take advantage of this fund but it will also bring new competitors in the industry.
High dependence on third party suppliers
– Goldman Sachs Group Inc Pd ADR 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.
Weighted SWOT Analysis of Goldman Sachs Group Inc Pd ADR Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Goldman Sachs Group Inc Pd 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 Goldman Sachs Group Inc Pd 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 Goldman Sachs Group Inc Pd 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 Goldman Sachs Group Inc Pd 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 Goldman Sachs Group Inc Pd ADR needs to make to build a sustainable competitive advantage.