Iteris (ITI) SWOT Analysis / TOWS Matrix / MBA Resources
Security Systems & Services
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Iteris (United States)
Based on various researches at Oak Spring University , Iteris is operating in a macro-environment that has been destablized by – supply chains are disrupted by pandemic , talent flight as more people leaving formal jobs, increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies, increasing inequality as vast percentage of new income is going to the top 1%, technology disruption, digital marketing is dominated by two big players Facebook and Google,
there is backlash against globalization, increasing government debt because of Covid-19 spendings, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Iteris can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Iteris, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Iteris 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 Iteris can be done for the following purposes –
1. Strategic planning of Iteris
2. Improving business portfolio management of Iteris
3. Assessing feasibility of the new initiative in United States
4. Making a Security Systems & Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Iteris
Strengths of Iteris | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Iteris are -
Operational resilience
– The operational resilience strategy of Iteris comprises – understanding the underlying the factors in the Security Systems & Services 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.
Superior customer experience
– The customer experience strategy of Iteris in Security Systems & Services industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Learning organization
- Iteris 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 Iteris is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Iteris emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– Iteris is one of the most innovative firm in Security Systems & Services sector.
Successful track record of launching new products
– Iteris has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Iteris 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.
Diverse revenue streams
– Iteris is present in almost all the verticals within the Security Systems & Services industry. This has provided Iteris 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.
Highly skilled collaborators
– Iteris has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Security Systems & Services industry. Secondly the value chain collaborators of Iteris have helped the firm to develop new products and bring them quickly to the marketplace.
Training and development
– Iteris 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.
Ability to lead change in Security Systems & Services
– Iteris is one of the leading players in the Security Systems & Services industry in United States. Over the years it has not only transformed the business landscape in the Security Systems & Services industry in United States but also across the existing markets. The ability to lead change has enabled Iteris in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Strong track record of project management in the Security Systems & Services industry
– Iteris is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Organizational Resilience of Iteris
– The covid-19 pandemic has put organizational resilience at the centre of everthing Iteris does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Analytics focus
– Iteris 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 Security Systems & Services 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.
Weaknesses of Iteris | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Iteris are -
Aligning sales with marketing
– From the outside it seems that Iteris needs to have more collaboration between its sales team and marketing team. Sales professionals in the Security Systems & Services industry have deep experience in developing customer relationships. Marketing department at Iteris can leverage the sales team experience to cultivate customer relationships as Iteris is planning to shift buying processes online.
Ability to respond to the competition
– As the decision making is very deliberative at Iteris, in the dynamic environment of Security Systems & Services industry it has struggled to respond to the nimble upstart competition. Iteris has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Capital Spending Reduction
– Even during the low interest decade, Iteris 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 Security Systems & Services industry using digital technology.
Need for greater diversity
– Iteris 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 Iteris has some of the most successful models in the Security Systems & Services industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Iteris should strive to include more intangible value offerings along with its core products and services.
Slow decision making process
– As mentioned earlier in the report, Iteris has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Security Systems & Services industry over the last five years. Iteris 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.
Lack of clear differentiation of Iteris products
– To increase the profitability and margins on the products, Iteris needs to provide more differentiated products than what it is currently offering in the marketplace.
High bargaining power of channel partners in Security Systems & Services industry
– because of the regulatory requirements in United States, Iteris 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 Security Systems & Services industry.
High cash cycle compare to competitors
Iteris has a high cash cycle compare to other players in the Security Systems & Services 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, Iteris 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Iteris is slow explore the new channels of communication. These new channels of communication can help Iteris to provide better information regarding Security Systems & Services products and services. It can also build an online community to further reach out to potential customers.
Iteris Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Iteris are -
Using analytics as competitive advantage
– Iteris has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Security Systems & Services sector. This continuous investment in analytics has enabled Iteris to build a competitive advantage using analytics. The analytics driven competitive advantage can help Iteris to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Learning at scale
– Online learning technologies has now opened space for Iteris 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Iteris in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Security Systems & Services industry, and it will provide faster access to the consumers.
Better consumer reach
– The expansion of the 5G network will help Iteris to increase its market reach. Iteris 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.
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 Iteris 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.
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. Iteris can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Buying journey improvements
– Iteris can improve the customer journey of consumers in the Security Systems & Services 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, Iteris can use these opportunities to build new business models that can help the communities that Iteris operates in. Secondly it can use opportunities from government spending in Security Systems & Services sector.
Building a culture of innovation
– managers at Iteris 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 Security Systems & Services industry.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Iteris 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 Iteris to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Loyalty marketing
– Iteris 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
– Iteris can use the latest technology developments to improve its manufacturing and designing process in Security Systems & Services 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
– Iteris can develop new processes and procedures in Security Systems & Services 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.
Threats Iteris External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Iteris are -
High dependence on third party suppliers
– Iteris 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.
Stagnating economy with rate increase
– Iteris 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 Security Systems & Services industry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Iteris may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Security Systems & Services sector.
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 Iteris.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Iteris 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 Iteris prominent markets.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Iteris in Security Systems & Services industry. The Security Systems & Services 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Security Systems & Services industry are lowering. It can presents Iteris with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Security Systems & Services sector.
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. Iteris needs to understand the core reasons impacting the Security Systems & Services industry. This will help it in building a better workplace.
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. Iteris 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.
Regulatory challenges
– Iteris 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 Security Systems & Services industry regulations.
Technology acceleration in Forth Industrial Revolution
– Iteris has witnessed rapid integration of technology during Covid-19 in the Security Systems & Services industry. As one of the leading players in the industry, Iteris needs to keep up with the evolution of technology in the Security Systems & Services 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.
Environmental challenges
– Iteris 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. Iteris can take advantage of this fund but it will also bring new competitors in the Security Systems & Services industry.
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 Iteris business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of Iteris Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Iteris 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 Iteris 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 Iteris 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 Iteris 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 Iteris needs to make to build a sustainable competitive advantage.