Genesee&Wyoming (GWR) SWOT Analysis / TOWS Matrix / MBA Resources
Railroads
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Genesee&Wyoming (United States)
Based on various researches at Oak Spring University , Genesee&Wyoming is operating in a macro-environment that has been destablized by – increasing household debt because of falling income levels, challanges to central banks by blockchain based private currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing government debt because of Covid-19 spendings, increasing inequality as vast percentage of new income is going to the top 1%, competitive advantages are harder to sustain because of technology dispersion, central banks are concerned over increasing inflation,
cloud computing is disrupting traditional business models, technology disruption, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Genesee&Wyoming can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Genesee&Wyoming, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Genesee&Wyoming 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 Genesee&Wyoming can be done for the following purposes –
1. Strategic planning of Genesee&Wyoming
2. Improving business portfolio management of Genesee&Wyoming
3. Assessing feasibility of the new initiative in United States
4. Making a Railroads sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Genesee&Wyoming
Strengths of Genesee&Wyoming | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Genesee&Wyoming are -
Sustainable margins compare to other players in Railroads industry
– Genesee&Wyoming has clearly differentiated products in the market place. This has enabled Genesee&Wyoming to fetch slight price premium compare to the competitors in the Railroads industry. The sustainable margins have also helped Genesee&Wyoming to invest into research and development (R&D) and innovation.
Organizational Resilience of Genesee&Wyoming
– The covid-19 pandemic has put organizational resilience at the centre of everthing Genesee&Wyoming 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 Genesee&Wyoming 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 Railroads industry
- digital transformation varies from industry to industry. For Genesee&Wyoming digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Genesee&Wyoming 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.
Learning organization
- Genesee&Wyoming 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 Genesee&Wyoming is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Genesee&Wyoming emphasize – knowledge, initiative, and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Genesee&Wyoming 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.
Diverse revenue streams
– Genesee&Wyoming is present in almost all the verticals within the Railroads industry. This has provided Genesee&Wyoming 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.
Ability to lead change in Railroads
– Genesee&Wyoming is one of the leading players in the Railroads industry in United States. Over the years it has not only transformed the business landscape in the Railroads industry in United States but also across the existing markets. The ability to lead change has enabled Genesee&Wyoming 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
– Genesee&Wyoming is one of the leading players in the Railroads 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.
Training and development
– Genesee&Wyoming has one of the best training and development program in Transportation 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.
Operational resilience
– The operational resilience strategy of Genesee&Wyoming comprises – understanding the underlying the factors in the Railroads 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.
Low bargaining power of suppliers
– Suppliers of Genesee&Wyoming in the Transportation sector have low bargaining power. Genesee&Wyoming has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Genesee&Wyoming to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses of Genesee&Wyoming | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Genesee&Wyoming are -
High cash cycle compare to competitors
Genesee&Wyoming has a high cash cycle compare to other players in the Railroads industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Interest costs
– Compare to the competition, Genesee&Wyoming 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.
Need for greater diversity
– Genesee&Wyoming has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Products dominated business model
– Even though Genesee&Wyoming has some of the most successful models in the Railroads industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Genesee&Wyoming should strive to include more intangible value offerings along with its core products and services.
High dependence on Genesee&Wyoming ‘s star products
– The top 2 products and services of Genesee&Wyoming still accounts for major business revenue. This dependence on star products in Railroads industry has resulted into insufficient focus on developing new products, even though Genesee&Wyoming has relatively successful track record of launching new products.
Employees’ less understanding of Genesee&Wyoming strategy
– From the outside it seems that the employees of Genesee&Wyoming 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.
Skills based hiring in Railroads industry
– The stress on hiring functional specialists at Genesee&Wyoming has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Slow to strategic competitive environment developments
– As Genesee&Wyoming is one of the leading players in the Railroads industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Railroads industry in last five years.
Lack of clear differentiation of Genesee&Wyoming products
– To increase the profitability and margins on the products, Genesee&Wyoming needs to provide more differentiated products than what it is currently offering in the marketplace.
Increasing silos among functional specialists
– The organizational structure of Genesee&Wyoming is dominated by functional specialists. It is not different from other players in the Railroads industry, but Genesee&Wyoming needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Genesee&Wyoming to focus more on services in the Railroads industry rather than just following the product oriented approach.
Compensation and incentives
– The revenue per employee of Genesee&Wyoming is just above the Railroads 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.
Genesee&Wyoming Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Genesee&Wyoming are -
Leveraging digital technologies
– Genesee&Wyoming can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Learning at scale
– Online learning technologies has now opened space for Genesee&Wyoming 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.
Manufacturing automation
– Genesee&Wyoming can use the latest technology developments to improve its manufacturing and designing process in Railroads 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.
Using analytics as competitive advantage
– Genesee&Wyoming has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Railroads sector. This continuous investment in analytics has enabled Genesee&Wyoming to build a competitive advantage using analytics. The analytics driven competitive advantage can help Genesee&Wyoming to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Developing new processes and practices
– Genesee&Wyoming can develop new processes and procedures in Railroads 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.
Better consumer reach
– The expansion of the 5G network will help Genesee&Wyoming to increase its market reach. Genesee&Wyoming will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Genesee&Wyoming can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Genesee&Wyoming in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Railroads industry, and it will provide faster access to the consumers.
Use of Bitcoin and other crypto currencies for transactions in Railroads industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Genesee&Wyoming in the Railroads industry. Now Genesee&Wyoming can target international markets with far fewer capital restrictions requirements than the existing system.
Low interest rates
– Even though inflation is raising its head in most developed economies, Genesee&Wyoming 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.
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. Genesee&Wyoming can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Building a culture of innovation
– managers at Genesee&Wyoming 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 Railroads industry.
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 Genesee&Wyoming 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.
Threats Genesee&Wyoming External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Genesee&Wyoming are -
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 Genesee&Wyoming business can come under increasing regulations regarding data privacy, data security, etc.
Technology acceleration in Forth Industrial Revolution
– Genesee&Wyoming has witnessed rapid integration of technology during Covid-19 in the Railroads industry. As one of the leading players in the industry, Genesee&Wyoming needs to keep up with the evolution of technology in the Railroads 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 Genesee&Wyoming
– 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 Genesee&Wyoming.
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. Genesee&Wyoming needs to understand the core reasons impacting the Railroads industry. This will help it in building a better workplace.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Railroads industry are lowering. It can presents Genesee&Wyoming with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Railroads sector.
Stagnating economy with rate increase
– Genesee&Wyoming 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 Railroads industry.
Regulatory challenges
– Genesee&Wyoming 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 Railroads industry regulations.
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 Genesee&Wyoming in the Railroads sector and impact the bottomline of the organization.
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. Genesee&Wyoming 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Genesee&Wyoming 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 Genesee&Wyoming prominent markets.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Genesee&Wyoming in Railroads industry. The Railroads 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.
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 Genesee&Wyoming.
Shortening product life cycle
– it is one of the major threat that Genesee&Wyoming is facing in Railroads sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Genesee&Wyoming Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Genesee&Wyoming 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 Genesee&Wyoming 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 Genesee&Wyoming 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 Genesee&Wyoming 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 Genesee&Wyoming needs to make to build a sustainable competitive advantage.
