SWOT Analysis / TOWS Matrix for Jumbo Interactive (Australia)
Based on various researches at Oak Spring University , Jumbo Interactive is operating in a macro-environment that has been destablized by – competitive advantages are harder to sustain because of technology dispersion, there is backlash against globalization, geopolitical disruptions, cloud computing is disrupting traditional business models, increasing commodity prices, challanges to central banks by blockchain based private currencies, central banks are concerned over increasing inflation,
supply chains are disrupted by pandemic , digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Jumbo Interactive
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Jumbo Interactive can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Jumbo Interactive, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Jumbo Interactive 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 Jumbo Interactive can be done for the following purposes –
1. Strategic planning of Jumbo Interactive
2. Improving business portfolio management of Jumbo Interactive
3. Assessing feasibility of the new initiative in Australia
4. Making a Casinos & Gaming sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Jumbo Interactive
Strengths of Jumbo Interactive | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Jumbo Interactive are -
Ability to lead change in Casinos & Gaming
– Jumbo Interactive is one of the leading players in the Casinos & Gaming industry in Australia. Over the years it has not only transformed the business landscape in the Casinos & Gaming industry in Australia but also across the existing markets. The ability to lead change has enabled Jumbo Interactive 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 Casinos & Gaming industry
– Jumbo Interactive is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Cross disciplinary teams
– Horizontal connected teams at the Jumbo Interactive 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.
Operational resilience
– The operational resilience strategy of Jumbo Interactive comprises – understanding the underlying the factors in the Casinos & Gaming 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.
Diverse revenue streams
– Jumbo Interactive is present in almost all the verticals within the Casinos & Gaming industry. This has provided Jumbo Interactive 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.
Highly skilled collaborators
– Jumbo Interactive has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Casinos & Gaming industry. Secondly the value chain collaborators of Jumbo Interactive have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to recruit top talent
– Jumbo Interactive is one of the leading players in the Casinos & Gaming industry in Australia. It is in a position to attract the best talent available in Australia. The firm has a robust talent identification program that helps in identifying the brightest.
Analytics focus
– Jumbo Interactive 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 Casinos & Gaming industry. The technology infrastructure of Australia 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.
Low bargaining power of suppliers
– Suppliers of Jumbo Interactive in the Services sector have low bargaining power. Jumbo Interactive has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Jumbo Interactive to manage not only supply disruptions but also source products at highly competitive prices.
Digital Transformation in Casinos & Gaming industry
- digital transformation varies from industry to industry. For Jumbo Interactive digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Jumbo Interactive 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.
Innovation driven organization
– Jumbo Interactive is one of the most innovative firm in Casinos & Gaming sector.
Learning organization
- Jumbo Interactive 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 Jumbo Interactive is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Jumbo Interactive emphasize – knowledge, initiative, and innovation.
Weaknesses of Jumbo Interactive | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Jumbo Interactive are -
Products dominated business model
– Even though Jumbo Interactive has some of the most successful models in the Casinos & Gaming industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Jumbo Interactive should strive to include more intangible value offerings along with its core products and services.
Aligning sales with marketing
– From the outside it seems that Jumbo Interactive needs to have more collaboration between its sales team and marketing team. Sales professionals in the Casinos & Gaming industry have deep experience in developing customer relationships. Marketing department at Jumbo Interactive can leverage the sales team experience to cultivate customer relationships as Jumbo Interactive is planning to shift buying processes online.
No frontier risks strategy
– From the 10K / annual statement of Jumbo Interactive, it seems that company is thinking out the frontier risks that can impact Casinos & Gaming industry. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Increasing silos among functional specialists
– The organizational structure of Jumbo Interactive is dominated by functional specialists. It is not different from other players in the Casinos & Gaming industry, but Jumbo Interactive needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Jumbo Interactive to focus more on services in the Casinos & Gaming industry rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As Jumbo Interactive is one of the leading players in the Casinos & Gaming industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Casinos & Gaming industry in last five years.
Lack of clear differentiation of Jumbo Interactive products
– To increase the profitability and margins on the products, Jumbo Interactive needs to provide more differentiated products than what it is currently offering in the marketplace.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Jumbo Interactive supply chain. Even after few cautionary changes, Jumbo Interactive is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Jumbo Interactive vulnerable to further global disruptions in South East Asia.
Capital Spending Reduction
– Even during the low interest decade, Jumbo Interactive has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the Casinos & Gaming industry using digital technology.
Need for greater diversity
– Jumbo Interactive 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.
Interest costs
– Compare to the competition, Jumbo Interactive has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Ability to respond to the competition
– As the decision making is very deliberative at Jumbo Interactive, in the dynamic environment of Casinos & Gaming industry it has struggled to respond to the nimble upstart competition. Jumbo Interactive has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Jumbo Interactive Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Jumbo Interactive are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Jumbo Interactive 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 Jumbo Interactive to hire the very best people irrespective of their geographical location.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Jumbo Interactive 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
– Jumbo Interactive has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Casinos & Gaming sector. This continuous investment in analytics has enabled Jumbo Interactive to build a competitive advantage using analytics. The analytics driven competitive advantage can help Jumbo Interactive to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Jumbo Interactive in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Casinos & Gaming industry, and it will provide faster access to the consumers.
Loyalty marketing
– Jumbo Interactive 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Casinos & Gaming industry, but it has also influenced the consumer preferences. Jumbo Interactive 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 Jumbo Interactive 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 Casinos & Gaming industry.
Manufacturing automation
– Jumbo Interactive can use the latest technology developments to improve its manufacturing and designing process in Casinos & Gaming 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.
Developing new processes and practices
– Jumbo Interactive can develop new processes and procedures in Casinos & Gaming 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.
Better consumer reach
– The expansion of the 5G network will help Jumbo Interactive to increase its market reach. Jumbo Interactive 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Casinos & Gaming industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Jumbo Interactive 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. Jumbo Interactive 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Jumbo Interactive can use these opportunities to build new business models that can help the communities that Jumbo Interactive operates in. Secondly it can use opportunities from government spending in Casinos & Gaming sector.
Learning at scale
– Online learning technologies has now opened space for Jumbo Interactive 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.
Threats Jumbo Interactive External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Jumbo Interactive are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Jumbo Interactive in Casinos & Gaming industry. The Casinos & Gaming 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.
Regulatory challenges
– Jumbo Interactive 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 Casinos & Gaming industry regulations.
Consumer confidence and its impact on Jumbo Interactive 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 Casinos & Gaming industry and other sectors.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Casinos & Gaming industry are lowering. It can presents Jumbo Interactive with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Casinos & Gaming sector.
Easy access to finance
– Easy access to finance in Casinos & Gaming industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Jumbo Interactive can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Jumbo Interactive business can come under increasing regulations regarding data privacy, data security, etc.
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. Jumbo Interactive 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.
Shortening product life cycle
– it is one of the major threat that Jumbo Interactive is facing in Casinos & Gaming sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Jumbo Interactive 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 Jumbo Interactive prominent markets.
Stagnating economy with rate increase
– Jumbo Interactive 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 Casinos & Gaming industry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Jumbo Interactive may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Casinos & Gaming sector.
Increasing wage structure of Jumbo Interactive
– 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 Jumbo Interactive.
Environmental challenges
– Jumbo Interactive 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. Jumbo Interactive can take advantage of this fund but it will also bring new competitors in the Casinos & Gaming industry.
Weighted SWOT Analysis of Jumbo Interactive Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Jumbo Interactive 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 Jumbo Interactive 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 Jumbo Interactive 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 Jumbo Interactive 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 Jumbo Interactive needs to make to build a sustainable competitive advantage.