Lincoln Educational (LINC) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Lincoln Educational (United States)

Based on various researches at Oak Spring University , Lincoln Educational is operating in a macro-environment that has been destablized by – supply chains are disrupted by pandemic , increasing transportation and logistics costs, customer relationship management is fast transforming because of increasing concerns over data privacy, central banks are concerned over increasing inflation, wage bills are increasing, geopolitical disruptions, increasing government debt because of Covid-19 spendings, there is backlash against globalization, digital marketing is dominated by two big players Facebook and Google, etc

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Introduction to SWOT Analysis of Lincoln Educational

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Lincoln Educational can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Lincoln Educational, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Lincoln Educational 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of Lincoln Educational can be done for the following purposes –
1. Strategic planning of Lincoln Educational
2. Improving business portfolio management of Lincoln Educational
3. Assessing feasibility of the new initiative in United States
4. Making a Schools sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Lincoln Educational

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Strengths of Lincoln Educational | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Lincoln Educational are -

Ability to lead change in Schools

– Lincoln Educational is one of the leading players in the Schools industry in United States. Over the years it has not only transformed the business landscape in the Schools industry in United States but also across the existing markets. The ability to lead change has enabled Lincoln Educational in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

Effective Research and Development (R&D)

– Lincoln Educational has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Lincoln Educational staying ahead in the Schools industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

High brand equity

– Lincoln Educational has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Lincoln Educational to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Ability to recruit top talent

– Lincoln Educational is one of the leading players in the Schools 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 Lincoln Educational in the Services sector have low bargaining power. Lincoln Educational has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Lincoln Educational to manage not only supply disruptions but also source products at highly competitive prices.

Highly skilled collaborators

– Lincoln Educational has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Schools industry. Secondly the value chain collaborators of Lincoln Educational have helped the firm to develop new products and bring them quickly to the marketplace.

Operational resilience

– The operational resilience strategy of Lincoln Educational comprises – understanding the underlying the factors in the Schools 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.

Analytics focus

– Lincoln Educational 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 Schools 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.

Digital Transformation in Schools industry

- digital transformation varies from industry to industry. For Lincoln Educational digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Lincoln Educational 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.

Strong track record of project management in the Schools industry

– Lincoln Educational is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Learning organization

- Lincoln Educational 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 Lincoln Educational is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Lincoln Educational emphasize – knowledge, initiative, and innovation.

Sustainable margins compare to other players in Schools industry

– Lincoln Educational has clearly differentiated products in the market place. This has enabled Lincoln Educational to fetch slight price premium compare to the competitors in the Schools industry. The sustainable margins have also helped Lincoln Educational to invest into research and development (R&D) and innovation.

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Weaknesses of Lincoln Educational | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Lincoln Educational are -

Skills based hiring in Schools industry

– The stress on hiring functional specialists at Lincoln Educational 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.

Ability to respond to the competition

– As the decision making is very deliberative at Lincoln Educational, in the dynamic environment of Schools industry it has struggled to respond to the nimble upstart competition. Lincoln Educational has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

Slow decision making process

– As mentioned earlier in the report, Lincoln Educational has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Schools industry over the last five years. Lincoln Educational 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.

Aligning sales with marketing

– From the outside it seems that Lincoln Educational needs to have more collaboration between its sales team and marketing team. Sales professionals in the Schools industry have deep experience in developing customer relationships. Marketing department at Lincoln Educational can leverage the sales team experience to cultivate customer relationships as Lincoln Educational is planning to shift buying processes online.

Need for greater diversity

– Lincoln Educational 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 Lincoln Educational has some of the most successful models in the Schools industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Lincoln Educational should strive to include more intangible value offerings along with its core products and services.

Workers concerns about automation

– As automation is fast increasing in the Schools industry, Lincoln Educational 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.

Compensation and incentives

– The revenue per employee of Lincoln Educational is just above the Schools 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.

High bargaining power of channel partners in Schools industry

– because of the regulatory requirements in United States, Lincoln Educational 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 Schools industry.

High cash cycle compare to competitors

Lincoln Educational has a high cash cycle compare to other players in the Schools industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Lincoln Educational is slow explore the new channels of communication. These new channels of communication can help Lincoln Educational to provide better information regarding Schools products and services. It can also build an online community to further reach out to potential customers.

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Lincoln Educational Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of Lincoln Educational are -

Better consumer reach

– The expansion of the 5G network will help Lincoln Educational to increase its market reach. Lincoln Educational 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.

Finding new ways to collaborate

– Covid-19 has not only transformed business models of companies in Schools industry, but it has also influenced the consumer preferences. Lincoln Educational can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

Building a culture of innovation

– managers at Lincoln Educational 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 Schools industry.

Buying journey improvements

– Lincoln Educational can improve the customer journey of consumers in the Schools 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 Schools industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Lincoln Educational 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. Lincoln Educational 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

– Lincoln Educational 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.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Lincoln Educational 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 Lincoln Educational to hire the very best people irrespective of their geographical location.

Loyalty marketing

– Lincoln Educational 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.

Use of Bitcoin and other crypto currencies for transactions in Schools industry

– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Lincoln Educational in the Schools industry. Now Lincoln Educational can target international markets with far fewer capital restrictions requirements than the existing system.

Redefining models of collaboration and team work

– As explained in the weaknesses section, Lincoln Educational is facing challenges because of the dominance of functional experts in the organization. Lincoln Educational can utilize new technology in the field of Schools industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, Lincoln Educational 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 Lincoln Educational to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Lincoln Educational can use these opportunities to build new business models that can help the communities that Lincoln Educational operates in. Secondly it can use opportunities from government spending in Schools sector.

Lowering marketing communication costs

– 5G expansion will open new opportunities for Lincoln Educational in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Schools industry, and it will provide faster access to the consumers.

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Threats Lincoln Educational External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of Lincoln Educational are -

Technology acceleration in Forth Industrial Revolution

– Lincoln Educational has witnessed rapid integration of technology during Covid-19 in the Schools industry. As one of the leading players in the industry, Lincoln Educational needs to keep up with the evolution of technology in the Schools 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.

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, Lincoln Educational may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Schools sector.

Stagnating economy with rate increase

– Lincoln Educational 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 Schools industry.

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.

Shortening product life cycle

– it is one of the major threat that Lincoln Educational is facing in Schools sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

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 Lincoln Educational.

High dependence on third party suppliers

– Lincoln Educational 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.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Lincoln Educational in Schools industry. The Schools 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.

Easy access to finance

– Easy access to finance in Schools industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Lincoln Educational can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.

Increasing wage structure of Lincoln Educational

– 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 Lincoln Educational.

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. Lincoln Educational 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.

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. Lincoln Educational needs to understand the core reasons impacting the Schools industry. This will help it in building a better workplace.

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 Lincoln Educational in the Schools sector and impact the bottomline of the organization.

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Weighted SWOT Analysis of Lincoln Educational Template, Example

Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Lincoln Educational 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 Lincoln Educational 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 Lincoln Educational 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 Lincoln Educational 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 Lincoln Educational needs to make to build a sustainable competitive advantage.

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