Based on various researches at Oak Spring University , PIMCO Dynamic Credit is operating in a macro-environment that has been destablized by – technology disruption, digital marketing is dominated by two big players Facebook and Google, central banks are concerned over increasing inflation, talent flight as more people leaving formal jobs, banking and financial system is disrupted by Bitcoin and other crypto currencies, geopolitical disruptions, customer relationship management is fast transforming because of increasing concerns over data privacy,
increasing energy prices, increasing commodity prices, etc
Introduction to SWOT Analysis of PIMCO Dynamic Credit
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that PIMCO Dynamic Credit can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the PIMCO Dynamic Credit, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which PIMCO Dynamic Credit 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 PIMCO Dynamic Credit can be done for the following purposes –
1. Strategic planning of PIMCO Dynamic Credit
2. Improving business portfolio management of PIMCO Dynamic Credit
3. Assessing feasibility of the new initiative in United States
4. Making a Misc. Financial Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of PIMCO Dynamic Credit
Strengths of PIMCO Dynamic Credit | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of PIMCO Dynamic Credit are -
High switching costs
– The high switching costs that PIMCO Dynamic Credit 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.
Low bargaining power of suppliers
– Suppliers of PIMCO Dynamic Credit in the Financial sector have low bargaining power. PIMCO Dynamic Credit has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps PIMCO Dynamic Credit to manage not only supply disruptions but also source products at highly competitive prices.
Learning organization
- PIMCO Dynamic Credit 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 PIMCO Dynamic Credit is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at PIMCO Dynamic Credit emphasize – knowledge, initiative, and innovation.
Effective Research and Development (R&D)
– PIMCO Dynamic Credit has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – PIMCO Dynamic Credit staying ahead in the Misc. Financial Services industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Digital Transformation in Misc. Financial Services industry
- digital transformation varies from industry to industry. For PIMCO Dynamic Credit digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. PIMCO Dynamic Credit 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.
Ability to lead change in Misc. Financial Services
– PIMCO Dynamic Credit is one of the leading players in the Misc. Financial Services industry in United States. Over the years it has not only transformed the business landscape in the Misc. Financial Services industry in United States but also across the existing markets. The ability to lead change has enabled PIMCO Dynamic Credit in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Organizational Resilience of PIMCO Dynamic Credit
– The covid-19 pandemic has put organizational resilience at the centre of everthing PIMCO Dynamic Credit does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High brand equity
– PIMCO Dynamic Credit has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled PIMCO Dynamic Credit to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– PIMCO Dynamic Credit is one of the most innovative firm in Misc. Financial Services sector.
Sustainable margins compare to other players in Misc. Financial Services industry
– PIMCO Dynamic Credit has clearly differentiated products in the market place. This has enabled PIMCO Dynamic Credit to fetch slight price premium compare to the competitors in the Misc. Financial Services industry. The sustainable margins have also helped PIMCO Dynamic Credit to invest into research and development (R&D) and innovation.
Strong track record of project management in the Misc. Financial Services industry
– PIMCO Dynamic Credit is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Superior customer experience
– The customer experience strategy of PIMCO Dynamic Credit in Misc. Financial Services industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses of PIMCO Dynamic Credit | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of PIMCO Dynamic Credit are -
Employees’ less understanding of PIMCO Dynamic Credit strategy
– From the outside it seems that the employees of PIMCO Dynamic Credit 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 PIMCO Dynamic Credit is dominated by functional specialists. It is not different from other players in the Misc. Financial Services industry, but PIMCO Dynamic Credit needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help PIMCO Dynamic Credit to focus more on services in the Misc. Financial Services industry rather than just following the product oriented approach.
Low market penetration in new markets
– Outside its home market of United States, PIMCO Dynamic Credit needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Need for greater diversity
– PIMCO Dynamic Credit 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 PIMCO Dynamic Credit has some of the most successful models in the Misc. Financial Services industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. PIMCO Dynamic Credit should strive to include more intangible value offerings along with its core products and services.
Interest costs
– Compare to the competition, PIMCO Dynamic Credit 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.
Aligning sales with marketing
– From the outside it seems that PIMCO Dynamic Credit needs to have more collaboration between its sales team and marketing team. Sales professionals in the Misc. Financial Services industry have deep experience in developing customer relationships. Marketing department at PIMCO Dynamic Credit can leverage the sales team experience to cultivate customer relationships as PIMCO Dynamic Credit is planning to shift buying processes online.
Capital Spending Reduction
– Even during the low interest decade, PIMCO Dynamic Credit 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 Misc. Financial Services industry using digital technology.
Ability to respond to the competition
– As the decision making is very deliberative at PIMCO Dynamic Credit, in the dynamic environment of Misc. Financial Services industry it has struggled to respond to the nimble upstart competition. PIMCO Dynamic Credit has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High bargaining power of channel partners in Misc. Financial Services industry
– because of the regulatory requirements in United States, PIMCO Dynamic Credit 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 Misc. Financial Services industry.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, PIMCO Dynamic Credit is slow explore the new channels of communication. These new channels of communication can help PIMCO Dynamic Credit to provide better information regarding Misc. Financial Services products and services. It can also build an online community to further reach out to potential customers.
PIMCO Dynamic Credit Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of PIMCO Dynamic Credit are -
Manufacturing automation
– PIMCO Dynamic Credit can use the latest technology developments to improve its manufacturing and designing process in Misc. Financial Services 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.
Building a culture of innovation
– managers at PIMCO Dynamic Credit 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 Misc. Financial Services industry.
Better consumer reach
– The expansion of the 5G network will help PIMCO Dynamic Credit to increase its market reach. PIMCO Dynamic Credit 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects PIMCO Dynamic Credit can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. PIMCO Dynamic Credit can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Misc. Financial Services industry, but it has also influenced the consumer preferences. PIMCO Dynamic Credit can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Leveraging digital technologies
– PIMCO Dynamic Credit 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Misc. Financial Services industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. PIMCO Dynamic Credit 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. PIMCO Dynamic Credit 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, PIMCO Dynamic Credit can use these opportunities to build new business models that can help the communities that PIMCO Dynamic Credit operates in. Secondly it can use opportunities from government spending in Misc. Financial Services sector.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for PIMCO Dynamic Credit 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 PIMCO Dynamic Credit to hire the very best people irrespective of their geographical location.
Loyalty marketing
– PIMCO Dynamic Credit 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.
Buying journey improvements
– PIMCO Dynamic Credit can improve the customer journey of consumers in the Misc. Financial Services 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, PIMCO Dynamic Credit 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 PIMCO Dynamic Credit to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Threats PIMCO Dynamic Credit External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of PIMCO Dynamic Credit are -
Increasing wage structure of PIMCO Dynamic Credit
– 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 PIMCO Dynamic Credit.
High dependence on third party suppliers
– PIMCO Dynamic Credit 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.
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 PIMCO Dynamic Credit.
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.
Environmental challenges
– PIMCO Dynamic Credit 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. PIMCO Dynamic Credit can take advantage of this fund but it will also bring new competitors in the Misc. Financial Services 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.
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. PIMCO Dynamic Credit 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.
Consumer confidence and its impact on PIMCO Dynamic Credit 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 Misc. Financial Services industry and other sectors.
Technology acceleration in Forth Industrial Revolution
– PIMCO Dynamic Credit has witnessed rapid integration of technology during Covid-19 in the Misc. Financial Services industry. As one of the leading players in the industry, PIMCO Dynamic Credit needs to keep up with the evolution of technology in the Misc. Financial Services 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.
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 PIMCO Dynamic Credit in the Misc. Financial Services sector and impact the bottomline of the organization.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, PIMCO Dynamic Credit 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 PIMCO Dynamic Credit prominent markets.
Shortening product life cycle
– it is one of the major threat that PIMCO Dynamic Credit is facing in Misc. Financial Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Easy access to finance
– Easy access to finance in Misc. Financial Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. PIMCO Dynamic Credit can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of PIMCO Dynamic Credit Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at PIMCO Dynamic Credit 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 PIMCO Dynamic Credit 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 PIMCO Dynamic Credit 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 PIMCO Dynamic Credit 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 PIMCO Dynamic Credit needs to make to build a sustainable competitive advantage.