SWOT Analysis / TOWS Matrix for NCS Multistage (United States)
Based on various researches at Oak Spring University , NCS Multistage is operating in a macro-environment that has been destablized by – customer relationship management is fast transforming because of increasing concerns over data privacy, central banks are concerned over increasing inflation, there is increasing trade war between United States & China, competitive advantages are harder to sustain because of technology dispersion, supply chains are disrupted by pandemic , banking and financial system is disrupted by Bitcoin and other crypto currencies, there is backlash against globalization,
increasing inequality as vast percentage of new income is going to the top 1%, increasing government debt because of Covid-19 spendings, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that NCS Multistage can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the NCS Multistage, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which NCS Multistage 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 NCS Multistage can be done for the following purposes –
1. Strategic planning of NCS Multistage
2. Improving business portfolio management of NCS Multistage
3. Assessing feasibility of the new initiative in United States
4. Making a Oil Well Services & Equipment sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of NCS Multistage
Strengths of NCS Multistage | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of NCS Multistage are -
Low bargaining power of suppliers
– Suppliers of NCS Multistage in the Energy sector have low bargaining power. NCS Multistage has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps NCS Multistage to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of NCS Multistage in Oil Well Services & Equipment industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Learning organization
- NCS Multistage 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 NCS Multistage is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at NCS Multistage emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– NCS Multistage is one of the most innovative firm in Oil Well Services & Equipment sector.
High switching costs
– The high switching costs that NCS Multistage 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.
Organizational Resilience of NCS Multistage
– The covid-19 pandemic has put organizational resilience at the centre of everthing NCS Multistage does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Analytics focus
– NCS Multistage 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 Oil Well Services & Equipment 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 lead change in Oil Well Services & Equipment
– NCS Multistage is one of the leading players in the Oil Well Services & Equipment industry in United States. Over the years it has not only transformed the business landscape in the Oil Well Services & Equipment industry in United States but also across the existing markets. The ability to lead change has enabled NCS Multistage in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Diverse revenue streams
– NCS Multistage is present in almost all the verticals within the Oil Well Services & Equipment industry. This has provided NCS Multistage 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.
Successful track record of launching new products
– NCS Multistage has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. NCS Multistage 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 Oil Well Services & Equipment industry
– NCS Multistage has clearly differentiated products in the market place. This has enabled NCS Multistage to fetch slight price premium compare to the competitors in the Oil Well Services & Equipment industry. The sustainable margins have also helped NCS Multistage to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– NCS Multistage has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Oil Well Services & Equipment industry. Secondly the value chain collaborators of NCS Multistage have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses of NCS Multistage | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of NCS Multistage are -
Slow decision making process
– As mentioned earlier in the report, NCS Multistage has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Oil Well Services & Equipment industry over the last five years. NCS Multistage 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.
Ability to respond to the competition
– As the decision making is very deliberative at NCS Multistage, in the dynamic environment of Oil Well Services & Equipment industry it has struggled to respond to the nimble upstart competition. NCS Multistage has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
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 NCS Multistage supply chain. Even after few cautionary changes, NCS Multistage is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left NCS Multistage vulnerable to further global disruptions in South East Asia.
Lack of clear differentiation of NCS Multistage products
– To increase the profitability and margins on the products, NCS Multistage needs to provide more differentiated products than what it is currently offering in the marketplace.
Skills based hiring in Oil Well Services & Equipment industry
– The stress on hiring functional specialists at NCS Multistage 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.
High bargaining power of channel partners in Oil Well Services & Equipment industry
– because of the regulatory requirements in United States, NCS Multistage 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 Oil Well Services & Equipment industry.
Aligning sales with marketing
– From the outside it seems that NCS Multistage needs to have more collaboration between its sales team and marketing team. Sales professionals in the Oil Well Services & Equipment industry have deep experience in developing customer relationships. Marketing department at NCS Multistage can leverage the sales team experience to cultivate customer relationships as NCS Multistage is planning to shift buying processes online.
High operating costs
– Compare to the competitors, NCS Multistage has high operating costs in the Oil Well Services & Equipment industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract NCS Multistage lucrative customers.
Products dominated business model
– Even though NCS Multistage has some of the most successful models in the Oil Well Services & Equipment industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. NCS Multistage should strive to include more intangible value offerings along with its core products and services.
Employees’ less understanding of NCS Multistage strategy
– From the outside it seems that the employees of NCS Multistage 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.
Increasing silos among functional specialists
– The organizational structure of NCS Multistage is dominated by functional specialists. It is not different from other players in the Oil Well Services & Equipment industry, but NCS Multistage needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help NCS Multistage to focus more on services in the Oil Well Services & Equipment industry rather than just following the product oriented approach.
NCS Multistage Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of NCS Multistage are -
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Oil Well Services & Equipment industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. NCS Multistage 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. NCS Multistage 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, NCS Multistage 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 NCS Multistage to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Learning at scale
– Online learning technologies has now opened space for NCS Multistage 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.
Using analytics as competitive advantage
– NCS Multistage has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Oil Well Services & Equipment sector. This continuous investment in analytics has enabled NCS Multistage to build a competitive advantage using analytics. The analytics driven competitive advantage can help NCS Multistage to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for NCS Multistage 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 NCS Multistage to hire the very best people irrespective of their geographical location.
Building a culture of innovation
– managers at NCS Multistage 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 Oil Well Services & Equipment industry.
Use of Bitcoin and other crypto currencies for transactions in Oil Well Services & Equipment industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for NCS Multistage in the Oil Well Services & Equipment industry. Now NCS Multistage can target international markets with far fewer capital restrictions requirements than the existing system.
Manufacturing automation
– NCS Multistage can use the latest technology developments to improve its manufacturing and designing process in Oil Well Services & Equipment 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.
Creating value in data economy
– The success of analytics program of NCS Multistage has opened avenues for new revenue streams for the organization in Oil Well Services & Equipment industry. This can help NCS Multistage to build a more holistic ecosystem for NCS Multistage products in the Oil Well Services & Equipment industry by providing – data insight services, data privacy related products, data based consulting services, 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, NCS Multistage can use these opportunities to build new business models that can help the communities that NCS Multistage operates in. Secondly it can use opportunities from government spending in Oil Well Services & Equipment sector.
Redefining models of collaboration and team work
– As explained in the weaknesses section, NCS Multistage is facing challenges because of the dominance of functional experts in the organization. NCS Multistage can utilize new technology in the field of Oil Well Services & Equipment industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects NCS Multistage can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Loyalty marketing
– NCS Multistage 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.
Threats NCS Multistage External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of NCS Multistage are -
High dependence on third party suppliers
– NCS Multistage 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.
Increasing wage structure of NCS Multistage
– 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 NCS Multistage.
Easy access to finance
– Easy access to finance in Oil Well Services & Equipment industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. NCS Multistage can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Regulatory challenges
– NCS Multistage 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 Oil Well Services & Equipment industry regulations.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, NCS Multistage 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 NCS Multistage prominent markets.
Shortening product life cycle
– it is one of the major threat that NCS Multistage is facing in Oil Well Services & Equipment sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Oil Well Services & Equipment industry are lowering. It can presents NCS Multistage with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Oil Well Services & Equipment sector.
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.
Technology acceleration in Forth Industrial Revolution
– NCS Multistage has witnessed rapid integration of technology during Covid-19 in the Oil Well Services & Equipment industry. As one of the leading players in the industry, NCS Multistage needs to keep up with the evolution of technology in the Oil Well Services & Equipment 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. NCS Multistage needs to understand the core reasons impacting the Oil Well Services & Equipment industry. This will help it in building a better workplace.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. NCS Multistage 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.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, NCS Multistage may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Oil Well Services & Equipment sector.
Weighted SWOT Analysis of NCS Multistage Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at NCS Multistage 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 NCS Multistage 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 NCS Multistage 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 NCS Multistage 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 NCS Multistage needs to make to build a sustainable competitive advantage.