SWOT Analysis / TOWS Matrix for NovaBay Pharmaceuticals (United States)
Based on various researches at Oak Spring University , NovaBay Pharmaceuticals is operating in a macro-environment that has been destablized by – there is backlash against globalization, there is increasing trade war between United States & China, customer relationship management is fast transforming because of increasing concerns over data privacy, competitive advantages are harder to sustain because of technology dispersion, digital marketing is dominated by two big players Facebook and Google, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing energy prices,
geopolitical disruptions, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of NovaBay Pharmaceuticals
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that NovaBay Pharmaceuticals can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the NovaBay Pharmaceuticals, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which NovaBay Pharmaceuticals 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 NovaBay Pharmaceuticals can be done for the following purposes –
1. Strategic planning of NovaBay Pharmaceuticals
2. Improving business portfolio management of NovaBay Pharmaceuticals
3. Assessing feasibility of the new initiative in United States
4. Making a Biotechnology & Drugs sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of NovaBay Pharmaceuticals
Strengths of NovaBay Pharmaceuticals | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of NovaBay Pharmaceuticals are -
High brand equity
– NovaBay Pharmaceuticals has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled NovaBay Pharmaceuticals to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– NovaBay Pharmaceuticals is present in almost all the verticals within the Biotechnology & Drugs industry. This has provided NovaBay Pharmaceuticals 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.
Superior customer experience
– The customer experience strategy of NovaBay Pharmaceuticals in Biotechnology & Drugs industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Successful track record of launching new products
– NovaBay Pharmaceuticals has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. NovaBay Pharmaceuticals 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 Biotechnology & Drugs industry
– NovaBay Pharmaceuticals has clearly differentiated products in the market place. This has enabled NovaBay Pharmaceuticals to fetch slight price premium compare to the competitors in the Biotechnology & Drugs industry. The sustainable margins have also helped NovaBay Pharmaceuticals to invest into research and development (R&D) and innovation.
Analytics focus
– NovaBay Pharmaceuticals 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 Biotechnology & Drugs 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.
Ability to recruit top talent
– NovaBay Pharmaceuticals is one of the leading players in the Biotechnology & Drugs 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
– NovaBay Pharmaceuticals has one of the best training and development program in Healthcare 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.
Cross disciplinary teams
– Horizontal connected teams at the NovaBay Pharmaceuticals 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.
Innovation driven organization
– NovaBay Pharmaceuticals is one of the most innovative firm in Biotechnology & Drugs sector.
Low bargaining power of suppliers
– Suppliers of NovaBay Pharmaceuticals in the Healthcare sector have low bargaining power. NovaBay Pharmaceuticals has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps NovaBay Pharmaceuticals to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that NovaBay Pharmaceuticals 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.
Weaknesses of NovaBay Pharmaceuticals | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of NovaBay Pharmaceuticals are -
Lack of clear differentiation of NovaBay Pharmaceuticals products
– To increase the profitability and margins on the products, NovaBay Pharmaceuticals needs to provide more differentiated products than what it is currently offering in the marketplace.
Low market penetration in new markets
– Outside its home market of United States, NovaBay Pharmaceuticals needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Products dominated business model
– Even though NovaBay Pharmaceuticals has some of the most successful models in the Biotechnology & Drugs industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. NovaBay Pharmaceuticals should strive to include more intangible value offerings along with its core products and services.
High dependence on NovaBay Pharmaceuticals ‘s star products
– The top 2 products and services of NovaBay Pharmaceuticals still accounts for major business revenue. This dependence on star products in Biotechnology & Drugs industry has resulted into insufficient focus on developing new products, even though NovaBay Pharmaceuticals has relatively successful track record of launching new products.
Workers concerns about automation
– As automation is fast increasing in the Biotechnology & Drugs industry, NovaBay Pharmaceuticals 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.
High operating costs
– Compare to the competitors, NovaBay Pharmaceuticals has high operating costs in the Biotechnology & Drugs industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract NovaBay Pharmaceuticals lucrative customers.
High bargaining power of channel partners in Biotechnology & Drugs industry
– because of the regulatory requirements in United States, NovaBay Pharmaceuticals 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 Biotechnology & Drugs industry.
Compensation and incentives
– The revenue per employee of NovaBay Pharmaceuticals is just above the Biotechnology & Drugs 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 decision making process
– As mentioned earlier in the report, NovaBay Pharmaceuticals has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Biotechnology & Drugs industry over the last five years. NovaBay Pharmaceuticals 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, NovaBay Pharmaceuticals is slow explore the new channels of communication. These new channels of communication can help NovaBay Pharmaceuticals to provide better information regarding Biotechnology & Drugs products and services. It can also build an online community to further reach out to potential customers.
Increasing silos among functional specialists
– The organizational structure of NovaBay Pharmaceuticals is dominated by functional specialists. It is not different from other players in the Biotechnology & Drugs industry, but NovaBay Pharmaceuticals needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help NovaBay Pharmaceuticals to focus more on services in the Biotechnology & Drugs industry rather than just following the product oriented approach.
NovaBay Pharmaceuticals Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of NovaBay Pharmaceuticals are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for NovaBay Pharmaceuticals in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Biotechnology & Drugs industry, and it will provide faster access to the consumers.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Biotechnology & Drugs industry, but it has also influenced the consumer preferences. NovaBay Pharmaceuticals can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Learning at scale
– Online learning technologies has now opened space for NovaBay Pharmaceuticals 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.
Leveraging digital technologies
– NovaBay Pharmaceuticals 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.
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 NovaBay Pharmaceuticals 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.
Developing new processes and practices
– NovaBay Pharmaceuticals can develop new processes and procedures in Biotechnology & Drugs 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, NovaBay Pharmaceuticals can use these opportunities to build new business models that can help the communities that NovaBay Pharmaceuticals operates in. Secondly it can use opportunities from government spending in Biotechnology & Drugs sector.
Building a culture of innovation
– managers at NovaBay Pharmaceuticals 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 Biotechnology & Drugs industry.
Use of Bitcoin and other crypto currencies for transactions in Biotechnology & Drugs industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for NovaBay Pharmaceuticals in the Biotechnology & Drugs industry. Now NovaBay Pharmaceuticals can target international markets with far fewer capital restrictions requirements than the existing system.
Better consumer reach
– The expansion of the 5G network will help NovaBay Pharmaceuticals to increase its market reach. NovaBay Pharmaceuticals 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.
Manufacturing automation
– NovaBay Pharmaceuticals can use the latest technology developments to improve its manufacturing and designing process in Biotechnology & Drugs 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects NovaBay Pharmaceuticals can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Using analytics as competitive advantage
– NovaBay Pharmaceuticals has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Biotechnology & Drugs sector. This continuous investment in analytics has enabled NovaBay Pharmaceuticals to build a competitive advantage using analytics. The analytics driven competitive advantage can help NovaBay Pharmaceuticals to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats NovaBay Pharmaceuticals External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of NovaBay Pharmaceuticals are -
Technology acceleration in Forth Industrial Revolution
– NovaBay Pharmaceuticals has witnessed rapid integration of technology during Covid-19 in the Biotechnology & Drugs industry. As one of the leading players in the industry, NovaBay Pharmaceuticals needs to keep up with the evolution of technology in the Biotechnology & Drugs 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.
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 NovaBay Pharmaceuticals.
Consumer confidence and its impact on NovaBay Pharmaceuticals 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 Biotechnology & Drugs industry and other sectors.
Stagnating economy with rate increase
– NovaBay Pharmaceuticals 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 Biotechnology & Drugs 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.
Easy access to finance
– Easy access to finance in Biotechnology & Drugs industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. NovaBay Pharmaceuticals can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. NovaBay Pharmaceuticals needs to understand the core reasons impacting the Biotechnology & Drugs industry. This will help it in building a better workplace.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Biotechnology & Drugs industry are lowering. It can presents NovaBay Pharmaceuticals with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Biotechnology & Drugs sector.
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. NovaBay Pharmaceuticals 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 dependence on third party suppliers
– NovaBay Pharmaceuticals 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 NovaBay Pharmaceuticals in Biotechnology & Drugs industry. The Biotechnology & Drugs 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.
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 NovaBay Pharmaceuticals in the Biotechnology & Drugs sector and impact the bottomline of the organization.
Environmental challenges
– NovaBay Pharmaceuticals 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. NovaBay Pharmaceuticals can take advantage of this fund but it will also bring new competitors in the Biotechnology & Drugs industry.
Weighted SWOT Analysis of NovaBay Pharmaceuticals Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at NovaBay Pharmaceuticals 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 NovaBay Pharmaceuticals 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 NovaBay Pharmaceuticals 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 NovaBay Pharmaceuticals 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 NovaBay Pharmaceuticals needs to make to build a sustainable competitive advantage.