Intevac (IVAC) SWOT Analysis / TOWS Matrix / MBA Resources
Computer Storage Devices
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Intevac (United States)
Based on various researches at Oak Spring University , Intevac is operating in a macro-environment that has been destablized by – there is increasing trade war between United States & China, there is backlash against globalization, technology disruption, increasing household debt because of falling income levels, wage bills are increasing, central banks are concerned over increasing inflation, increasing transportation and logistics costs,
increasing government debt because of Covid-19 spendings, geopolitical disruptions, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Intevac can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Intevac, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Intevac 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 Intevac can be done for the following purposes –
1. Strategic planning of Intevac
2. Improving business portfolio management of Intevac
3. Assessing feasibility of the new initiative in United States
4. Making a Computer Storage Devices sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Intevac
Strengths of Intevac | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Intevac are -
Successful track record of launching new products
– Intevac has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Intevac 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 Computer Storage Devices industry
– Intevac has clearly differentiated products in the market place. This has enabled Intevac to fetch slight price premium compare to the competitors in the Computer Storage Devices industry. The sustainable margins have also helped Intevac to invest into research and development (R&D) and innovation.
Ability to lead change in Computer Storage Devices
– Intevac is one of the leading players in the Computer Storage Devices industry in United States. Over the years it has not only transformed the business landscape in the Computer Storage Devices industry in United States but also across the existing markets. The ability to lead change has enabled Intevac in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Digital Transformation in Computer Storage Devices industry
- digital transformation varies from industry to industry. For Intevac digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Intevac 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.
Effective Research and Development (R&D)
– Intevac has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Intevac staying ahead in the Computer Storage Devices industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Cross disciplinary teams
– Horizontal connected teams at the Intevac 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.
Superior customer experience
– The customer experience strategy of Intevac in Computer Storage Devices industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High switching costs
– The high switching costs that Intevac 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.
Ability to recruit top talent
– Intevac is one of the leading players in the Computer Storage Devices 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.
Analytics focus
– Intevac 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 Computer Storage Devices 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.
Highly skilled collaborators
– Intevac has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Computer Storage Devices industry. Secondly the value chain collaborators of Intevac have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of Intevac
– The covid-19 pandemic has put organizational resilience at the centre of everthing Intevac does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses of Intevac | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Intevac are -
Lack of clear differentiation of Intevac products
– To increase the profitability and margins on the products, Intevac needs to provide more differentiated products than what it is currently offering in the marketplace.
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 Intevac supply chain. Even after few cautionary changes, Intevac is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Intevac vulnerable to further global disruptions in South East Asia.
Employees’ less understanding of Intevac strategy
– From the outside it seems that the employees of Intevac 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.
Ability to respond to the competition
– As the decision making is very deliberative at Intevac, in the dynamic environment of Computer Storage Devices industry it has struggled to respond to the nimble upstart competition. Intevac has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Products dominated business model
– Even though Intevac has some of the most successful models in the Computer Storage Devices industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Intevac should strive to include more intangible value offerings along with its core products and services.
High dependence on Intevac ‘s star products
– The top 2 products and services of Intevac still accounts for major business revenue. This dependence on star products in Computer Storage Devices industry has resulted into insufficient focus on developing new products, even though Intevac has relatively successful track record of launching new products.
High cash cycle compare to competitors
Intevac has a high cash cycle compare to other players in the Computer Storage Devices industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
High operating costs
– Compare to the competitors, Intevac has high operating costs in the Computer Storage Devices industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Intevac lucrative customers.
No frontier risks strategy
– From the 10K / annual statement of Intevac, it seems that company is thinking out the frontier risks that can impact Computer Storage Devices 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Intevac is slow explore the new channels of communication. These new channels of communication can help Intevac to provide better information regarding Computer Storage Devices products and services. It can also build an online community to further reach out to potential customers.
High bargaining power of channel partners in Computer Storage Devices industry
– because of the regulatory requirements in United States, Intevac 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 Computer Storage Devices industry.
Intevac Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Intevac are -
Better consumer reach
– The expansion of the 5G network will help Intevac to increase its market reach. Intevac 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.
Developing new processes and practices
– Intevac can develop new processes and procedures in Computer Storage Devices 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.
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. Intevac can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Intevac 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 Intevac 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
– Intevac 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Intevac 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 Intevac 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 Computer Storage Devices industry.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Computer Storage Devices industry, but it has also influenced the consumer preferences. Intevac can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Intevac 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 Intevac to hire the very best people irrespective of their geographical location.
Buying journey improvements
– Intevac can improve the customer journey of consumers in the Computer Storage Devices 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Computer Storage Devices industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Intevac 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. Intevac 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
– Intevac 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Intevac 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.
Threats Intevac External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Intevac are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Intevac may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Computer Storage Devices sector.
Increasing wage structure of Intevac
– 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 Intevac.
Regulatory challenges
– Intevac 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 Computer Storage Devices industry regulations.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Computer Storage Devices industry are lowering. It can presents Intevac with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Computer Storage Devices sector.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Intevac in Computer Storage Devices industry. The Computer Storage Devices 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.
High dependence on third party suppliers
– Intevac 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.
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. Intevac 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.
Environmental challenges
– Intevac 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. Intevac can take advantage of this fund but it will also bring new competitors in the Computer Storage Devices industry.
Easy access to finance
– Easy access to finance in Computer Storage Devices industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Intevac can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Intevac in the Computer Storage Devices sector and impact the bottomline of the organization.
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
– Intevac 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 Computer Storage Devices industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Intevac 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 Intevac prominent markets.
Weighted SWOT Analysis of Intevac Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Intevac 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 Intevac 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 Intevac 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 Intevac 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 Intevac needs to make to build a sustainable competitive advantage.