Based on various researches at Oak Spring University , Scorpio Tankers Note is operating in a macro-environment that has been destablized by – increasing household debt because of falling income levels, increasing energy prices, supply chains are disrupted by pandemic , increasing inequality as vast percentage of new income is going to the top 1%, there is backlash against globalization, digital marketing is dominated by two big players Facebook and Google, talent flight as more people leaving formal jobs,
cloud computing is disrupting traditional business models, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Scorpio Tankers Note
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Scorpio Tankers Note can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Scorpio Tankers Note, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Scorpio Tankers Note 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 Scorpio Tankers Note can be done for the following purposes –
1. Strategic planning of Scorpio Tankers Note
2. Improving business portfolio management of Scorpio Tankers Note
3. Assessing feasibility of the new initiative in United States
4. Making a sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Scorpio Tankers Note
Strengths of Scorpio Tankers Note | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Scorpio Tankers Note are -
Sustainable margins compare to other players in industry
– Scorpio Tankers Note has clearly differentiated products in the market place. This has enabled Scorpio Tankers Note to fetch slight price premium compare to the competitors in the industry. The sustainable margins have also helped Scorpio Tankers Note to invest into research and development (R&D) and innovation.
Effective Research and Development (R&D)
– Scorpio Tankers Note has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Scorpio Tankers Note staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Learning organization
- Scorpio Tankers Note 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 Scorpio Tankers Note is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Scorpio Tankers Note emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– Scorpio Tankers Note is one of the leading players in the 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.
Ability to lead change in
– Scorpio Tankers Note is one of the leading players in the industry in United States. Over the years it has not only transformed the business landscape in the industry in United States but also across the existing markets. The ability to lead change has enabled Scorpio Tankers Note in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High brand equity
– Scorpio Tankers Note has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Scorpio Tankers Note to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Operational resilience
– The operational resilience strategy of Scorpio Tankers Note comprises – understanding the underlying the factors in the 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.
Innovation driven organization
– Scorpio Tankers Note is one of the most innovative firm in sector.
Low bargaining power of suppliers
– Suppliers of Scorpio Tankers Note in the sector have low bargaining power. Scorpio Tankers Note has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Scorpio Tankers Note to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Scorpio Tankers Note in industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– Scorpio Tankers Note has one of the best training and development program in 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.
Digital Transformation in industry
- digital transformation varies from industry to industry. For Scorpio Tankers Note digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Scorpio Tankers Note 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.
Weaknesses of Scorpio Tankers Note | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Scorpio Tankers Note are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Scorpio Tankers Note is slow explore the new channels of communication. These new channels of communication can help Scorpio Tankers Note to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Employees’ less understanding of Scorpio Tankers Note strategy
– From the outside it seems that the employees of Scorpio Tankers Note 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.
Capital Spending Reduction
– Even during the low interest decade, Scorpio Tankers Note 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 industry using digital technology.
High operating costs
– Compare to the competitors, Scorpio Tankers Note has high operating costs in the industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Scorpio Tankers Note lucrative customers.
High dependence on Scorpio Tankers Note ‘s star products
– The top 2 products and services of Scorpio Tankers Note still accounts for major business revenue. This dependence on star products in industry has resulted into insufficient focus on developing new products, even though Scorpio Tankers Note has relatively successful track record of launching new products.
Increasing silos among functional specialists
– The organizational structure of Scorpio Tankers Note is dominated by functional specialists. It is not different from other players in the industry, but Scorpio Tankers Note needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Scorpio Tankers Note to focus more on services in the industry rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As Scorpio Tankers Note is one of the leading players in the industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Lack of clear differentiation of Scorpio Tankers Note products
– To increase the profitability and margins on the products, Scorpio Tankers Note needs to provide more differentiated products than what it is currently offering in the marketplace.
Compensation and incentives
– The revenue per employee of Scorpio Tankers Note is just above the 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.
No frontier risks strategy
– From the 10K / annual statement of Scorpio Tankers Note, it seems that company is thinking out the frontier risks that can impact 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.
Low market penetration in new markets
– Outside its home market of United States, Scorpio Tankers Note needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Scorpio Tankers Note Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Scorpio Tankers Note are -
Manufacturing automation
– Scorpio Tankers Note can use the latest technology developments to improve its manufacturing and designing process in 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Scorpio Tankers Note is facing challenges because of the dominance of functional experts in the organization. Scorpio Tankers Note can utilize new technology in the field of industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Scorpio Tankers Note 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 Scorpio Tankers Note to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Buying journey improvements
– Scorpio Tankers Note can improve the customer journey of consumers in the 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.
Creating value in data economy
– The success of analytics program of Scorpio Tankers Note has opened avenues for new revenue streams for the organization in industry. This can help Scorpio Tankers Note to build a more holistic ecosystem for Scorpio Tankers Note products in the industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Use of Bitcoin and other crypto currencies for transactions in industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Scorpio Tankers Note in the industry. Now Scorpio Tankers Note can target international markets with far fewer capital restrictions requirements than the existing system.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in industry, but it has also influenced the consumer preferences. Scorpio Tankers Note 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 Scorpio Tankers Note 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Scorpio Tankers Note can use these opportunities to build new business models that can help the communities that Scorpio Tankers Note operates in. Secondly it can use opportunities from government spending in sector.
Using analytics as competitive advantage
– Scorpio Tankers Note has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in sector. This continuous investment in analytics has enabled Scorpio Tankers Note to build a competitive advantage using analytics. The analytics driven competitive advantage can help Scorpio Tankers Note to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Low interest rates
– Even though inflation is raising its head in most developed economies, Scorpio Tankers Note can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Scorpio Tankers Note in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the industry, and it will provide faster access to the consumers.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Scorpio Tankers Note 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. Scorpio Tankers Note 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.
Threats Scorpio Tankers Note External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Scorpio Tankers Note are -
Consumer confidence and its impact on Scorpio Tankers Note 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 industry and other sectors.
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. Scorpio Tankers Note needs to understand the core reasons impacting the industry. This will help it in building a better workplace.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to industry are lowering. It can presents Scorpio Tankers Note with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Environmental challenges
– Scorpio Tankers Note 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. Scorpio Tankers Note can take advantage of this fund but it will also bring new competitors in the industry.
Technology acceleration in Forth Industrial Revolution
– Scorpio Tankers Note has witnessed rapid integration of technology during Covid-19 in the industry. As one of the leading players in the industry, Scorpio Tankers Note needs to keep up with the evolution of technology in the 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.
Easy access to finance
– Easy access to finance in industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Scorpio Tankers Note can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Shortening product life cycle
– it is one of the major threat that Scorpio Tankers Note is facing in sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
High dependence on third party suppliers
– Scorpio Tankers Note 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 Scorpio Tankers Note.
Stagnating economy with rate increase
– Scorpio Tankers Note 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 industry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Scorpio Tankers Note may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of 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. Scorpio Tankers Note 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.
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 Scorpio Tankers Note in the sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Scorpio Tankers Note Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Scorpio Tankers Note 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 Scorpio Tankers Note 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 Scorpio Tankers Note 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 Scorpio Tankers Note 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 Scorpio Tankers Note needs to make to build a sustainable competitive advantage.
