SWOT Analysis / TOWS Matrix for LCI Industries (United States)
Based on various researches at Oak Spring University , LCI Industries is operating in a macro-environment that has been destablized by – wage bills are increasing, digital marketing is dominated by two big players Facebook and Google, there is backlash against globalization, challanges to central banks by blockchain based private currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, geopolitical disruptions, cloud computing is disrupting traditional business models,
increasing commodity prices, competitive advantages are harder to sustain because of technology dispersion, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that LCI Industries can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the LCI Industries, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which LCI Industries 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 LCI Industries can be done for the following purposes –
1. Strategic planning of LCI Industries
2. Improving business portfolio management of LCI Industries
3. Assessing feasibility of the new initiative in United States
4. Making a Mobile Homes & RVs sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of LCI Industries
Strengths of LCI Industries | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of LCI Industries are -
Cross disciplinary teams
– Horizontal connected teams at the LCI Industries 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.
Ability to lead change in Mobile Homes & RVs
– LCI Industries is one of the leading players in the Mobile Homes & RVs industry in United States. Over the years it has not only transformed the business landscape in the Mobile Homes & RVs industry in United States but also across the existing markets. The ability to lead change has enabled LCI Industries 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 Mobile Homes & RVs industry
– LCI Industries is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Superior customer experience
– The customer experience strategy of LCI Industries in Mobile Homes & RVs industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Operational resilience
– The operational resilience strategy of LCI Industries comprises – understanding the underlying the factors in the Mobile Homes & RVs 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)
– LCI Industries has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – LCI Industries staying ahead in the Mobile Homes & RVs industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to recruit top talent
– LCI Industries is one of the leading players in the Mobile Homes & RVs 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.
Digital Transformation in Mobile Homes & RVs industry
- digital transformation varies from industry to industry. For LCI Industries digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. LCI Industries 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.
Low bargaining power of suppliers
– Suppliers of LCI Industries in the Capital Goods sector have low bargaining power. LCI Industries has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps LCI Industries to manage not only supply disruptions but also source products at highly competitive prices.
Organizational Resilience of LCI Industries
– The covid-19 pandemic has put organizational resilience at the centre of everthing LCI Industries does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Sustainable margins compare to other players in Mobile Homes & RVs industry
– LCI Industries has clearly differentiated products in the market place. This has enabled LCI Industries to fetch slight price premium compare to the competitors in the Mobile Homes & RVs industry. The sustainable margins have also helped LCI Industries to invest into research and development (R&D) and innovation.
High brand equity
– LCI Industries has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled LCI Industries to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses of LCI Industries | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of LCI Industries are -
Skills based hiring in Mobile Homes & RVs industry
– The stress on hiring functional specialists at LCI Industries 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.
Employees’ less understanding of LCI Industries strategy
– From the outside it seems that the employees of LCI Industries 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.
Aligning sales with marketing
– From the outside it seems that LCI Industries needs to have more collaboration between its sales team and marketing team. Sales professionals in the Mobile Homes & RVs industry have deep experience in developing customer relationships. Marketing department at LCI Industries can leverage the sales team experience to cultivate customer relationships as LCI Industries is planning to shift buying processes online.
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 LCI Industries supply chain. Even after few cautionary changes, LCI Industries is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left LCI Industries vulnerable to further global disruptions in South East Asia.
Lack of clear differentiation of LCI Industries products
– To increase the profitability and margins on the products, LCI Industries needs to provide more differentiated products than what it is currently offering in the marketplace.
High bargaining power of channel partners in Mobile Homes & RVs industry
– because of the regulatory requirements in United States, LCI Industries 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 Mobile Homes & RVs industry.
Compensation and incentives
– The revenue per employee of LCI Industries is just above the Mobile Homes & RVs 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.
Slow to strategic competitive environment developments
– As LCI Industries is one of the leading players in the Mobile Homes & RVs industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Mobile Homes & RVs industry in last five years.
Ability to respond to the competition
– As the decision making is very deliberative at LCI Industries, in the dynamic environment of Mobile Homes & RVs industry it has struggled to respond to the nimble upstart competition. LCI Industries has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Workers concerns about automation
– As automation is fast increasing in the Mobile Homes & RVs industry, LCI Industries needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, LCI Industries is slow explore the new channels of communication. These new channels of communication can help LCI Industries to provide better information regarding Mobile Homes & RVs products and services. It can also build an online community to further reach out to potential customers.
LCI Industries Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of LCI Industries are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, LCI Industries is facing challenges because of the dominance of functional experts in the organization. LCI Industries can utilize new technology in the field of Mobile Homes & RVs industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
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 LCI Industries 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.
Buying journey improvements
– LCI Industries can improve the customer journey of consumers in the Mobile Homes & RVs 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.
Creating value in data economy
– The success of analytics program of LCI Industries has opened avenues for new revenue streams for the organization in Mobile Homes & RVs industry. This can help LCI Industries to build a more holistic ecosystem for LCI Industries products in the Mobile Homes & RVs industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Developing new processes and practices
– LCI Industries can develop new processes and procedures in Mobile Homes & RVs 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.
Using analytics as competitive advantage
– LCI Industries has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Mobile Homes & RVs sector. This continuous investment in analytics has enabled LCI Industries to build a competitive advantage using analytics. The analytics driven competitive advantage can help LCI Industries 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 LCI Industries 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.
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. LCI Industries can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Building a culture of innovation
– managers at LCI Industries 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 Mobile Homes & RVs industry.
Use of Bitcoin and other crypto currencies for transactions in Mobile Homes & RVs industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for LCI Industries in the Mobile Homes & RVs industry. Now LCI Industries can target international markets with far fewer capital restrictions requirements than the existing system.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, LCI Industries 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 LCI Industries to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Mobile Homes & RVs industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. LCI Industries 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. LCI Industries 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, LCI Industries 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 LCI Industries External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of LCI Industries are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Mobile Homes & RVs industry are lowering. It can presents LCI Industries with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Mobile Homes & RVs sector.
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 LCI Industries business can come under increasing regulations regarding data privacy, data security, etc.
Technology acceleration in Forth Industrial Revolution
– LCI Industries has witnessed rapid integration of technology during Covid-19 in the Mobile Homes & RVs industry. As one of the leading players in the industry, LCI Industries needs to keep up with the evolution of technology in the Mobile Homes & RVs 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. LCI Industries needs to understand the core reasons impacting the Mobile Homes & RVs industry. This will help it in building a better workplace.
Shortening product life cycle
– it is one of the major threat that LCI Industries is facing in Mobile Homes & RVs sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Stagnating economy with rate increase
– LCI Industries 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 Mobile Homes & RVs industry.
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.
Consumer confidence and its impact on LCI Industries 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 Mobile Homes & RVs industry and other sectors.
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for LCI Industries in Mobile Homes & RVs industry. The Mobile Homes & RVs 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, LCI Industries 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 LCI Industries prominent markets.
Increasing wage structure of LCI Industries
– 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 LCI Industries.
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 LCI Industries.
Weighted SWOT Analysis of LCI Industries Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at LCI Industries 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 LCI Industries 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 LCI Industries 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 LCI Industries 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 LCI Industries needs to make to build a sustainable competitive advantage.
