Based on various researches at Oak Spring University , Suburban Propane Partners LP is operating in a macro-environment that has been destablized by – central banks are concerned over increasing inflation, wage bills are increasing, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing commodity prices, increasing household debt because of falling income levels, cloud computing is disrupting traditional business models, increasing transportation and logistics costs,
increasing inequality as vast percentage of new income is going to the top 1%, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Suburban Propane Partners LP
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Suburban Propane Partners LP can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Suburban Propane Partners LP, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Suburban Propane Partners LP 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 Suburban Propane Partners LP can be done for the following purposes –
1. Strategic planning of Suburban Propane Partners LP
2. Improving business portfolio management of Suburban Propane Partners LP
3. Assessing feasibility of the new initiative in United States
4. Making a Oil & Gas Operations sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Suburban Propane Partners LP
Strengths of Suburban Propane Partners LP | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Suburban Propane Partners LP are -
Strong track record of project management in the Oil & Gas Operations industry
– Suburban Propane Partners LP is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to recruit top talent
– Suburban Propane Partners LP is one of the leading players in the Oil & Gas Operations 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.
Analytics focus
– Suburban Propane Partners LP 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 & Gas Operations 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.
Innovation driven organization
– Suburban Propane Partners LP is one of the most innovative firm in Oil & Gas Operations sector.
Highly skilled collaborators
– Suburban Propane Partners LP has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Oil & Gas Operations industry. Secondly the value chain collaborators of Suburban Propane Partners LP have helped the firm to develop new products and bring them quickly to the marketplace.
High brand equity
– Suburban Propane Partners LP has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Suburban Propane Partners LP to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in Oil & Gas Operations industry
– Suburban Propane Partners LP has clearly differentiated products in the market place. This has enabled Suburban Propane Partners LP to fetch slight price premium compare to the competitors in the Oil & Gas Operations industry. The sustainable margins have also helped Suburban Propane Partners LP to invest into research and development (R&D) and innovation.
Low bargaining power of suppliers
– Suppliers of Suburban Propane Partners LP in the Energy sector have low bargaining power. Suburban Propane Partners LP has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Suburban Propane Partners LP to manage not only supply disruptions but also source products at highly competitive prices.
Effective Research and Development (R&D)
– Suburban Propane Partners LP has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Suburban Propane Partners LP staying ahead in the Oil & Gas Operations industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Cross disciplinary teams
– Horizontal connected teams at the Suburban Propane Partners LP 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.
Superior customer experience
– The customer experience strategy of Suburban Propane Partners LP in Oil & Gas Operations industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Organizational Resilience of Suburban Propane Partners LP
– The covid-19 pandemic has put organizational resilience at the centre of everthing Suburban Propane Partners LP does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses of Suburban Propane Partners LP | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Suburban Propane Partners LP are -
Aligning sales with marketing
– From the outside it seems that Suburban Propane Partners LP needs to have more collaboration between its sales team and marketing team. Sales professionals in the Oil & Gas Operations industry have deep experience in developing customer relationships. Marketing department at Suburban Propane Partners LP can leverage the sales team experience to cultivate customer relationships as Suburban Propane Partners LP is planning to shift buying processes online.
Ability to respond to the competition
– As the decision making is very deliberative at Suburban Propane Partners LP, in the dynamic environment of Oil & Gas Operations industry it has struggled to respond to the nimble upstart competition. Suburban Propane Partners LP has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High dependence on Suburban Propane Partners LP ‘s star products
– The top 2 products and services of Suburban Propane Partners LP still accounts for major business revenue. This dependence on star products in Oil & Gas Operations industry has resulted into insufficient focus on developing new products, even though Suburban Propane Partners LP has relatively successful track record of launching new products.
Products dominated business model
– Even though Suburban Propane Partners LP has some of the most successful models in the Oil & Gas Operations industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Suburban Propane Partners LP should strive to include more intangible value offerings along with its core products and services.
Lack of clear differentiation of Suburban Propane Partners LP products
– To increase the profitability and margins on the products, Suburban Propane Partners LP needs to provide more differentiated products than what it is currently offering in the marketplace.
Compensation and incentives
– The revenue per employee of Suburban Propane Partners LP is just above the Oil & Gas Operations 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.
Workers concerns about automation
– As automation is fast increasing in the Oil & Gas Operations industry, Suburban Propane Partners LP needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Capital Spending Reduction
– Even during the low interest decade, Suburban Propane Partners LP 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 Oil & Gas Operations industry using digital technology.
Interest costs
– Compare to the competition, Suburban Propane Partners LP 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.
High operating costs
– Compare to the competitors, Suburban Propane Partners LP has high operating costs in the Oil & Gas Operations industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Suburban Propane Partners LP lucrative customers.
Increasing silos among functional specialists
– The organizational structure of Suburban Propane Partners LP is dominated by functional specialists. It is not different from other players in the Oil & Gas Operations industry, but Suburban Propane Partners LP needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Suburban Propane Partners LP to focus more on services in the Oil & Gas Operations industry rather than just following the product oriented approach.
Suburban Propane Partners LP Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Suburban Propane Partners LP are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Suburban Propane Partners LP can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Suburban Propane Partners LP can use these opportunities to build new business models that can help the communities that Suburban Propane Partners LP operates in. Secondly it can use opportunities from government spending in Oil & Gas Operations sector.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Oil & Gas Operations industry, but it has also influenced the consumer preferences. Suburban Propane Partners LP 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 Suburban Propane Partners LP 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.
Manufacturing automation
– Suburban Propane Partners LP can use the latest technology developments to improve its manufacturing and designing process in Oil & Gas Operations 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, Suburban Propane Partners LP is facing challenges because of the dominance of functional experts in the organization. Suburban Propane Partners LP can utilize new technology in the field of Oil & Gas Operations industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Leveraging digital technologies
– Suburban Propane Partners LP 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Suburban Propane Partners LP 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 Suburban Propane Partners LP to hire the very best people irrespective of their geographical location.
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. Suburban Propane Partners LP can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Developing new processes and practices
– Suburban Propane Partners LP can develop new processes and procedures in Oil & Gas Operations 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.
Creating value in data economy
– The success of analytics program of Suburban Propane Partners LP has opened avenues for new revenue streams for the organization in Oil & Gas Operations industry. This can help Suburban Propane Partners LP to build a more holistic ecosystem for Suburban Propane Partners LP products in the Oil & Gas Operations industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– Suburban Propane Partners LP has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Oil & Gas Operations sector. This continuous investment in analytics has enabled Suburban Propane Partners LP to build a competitive advantage using analytics. The analytics driven competitive advantage can help Suburban Propane Partners LP to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Use of Bitcoin and other crypto currencies for transactions in Oil & Gas Operations industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Suburban Propane Partners LP in the Oil & Gas Operations industry. Now Suburban Propane Partners LP can target international markets with far fewer capital restrictions requirements than the existing system.
Threats Suburban Propane Partners LP External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Suburban Propane Partners LP are -
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. Suburban Propane Partners LP needs to understand the core reasons impacting the Oil & Gas Operations industry. This will help it in building a better workplace.
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.
Increasing wage structure of Suburban Propane Partners LP
– 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 Suburban Propane Partners LP.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Suburban Propane Partners LP in Oil & Gas Operations industry. The Oil & Gas Operations 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.
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, Suburban Propane Partners LP 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 & Gas Operations sector.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Oil & Gas Operations industry are lowering. It can presents Suburban Propane Partners LP with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Oil & Gas Operations 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. Suburban Propane Partners LP 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.
Environmental challenges
– Suburban Propane Partners LP 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. Suburban Propane Partners LP can take advantage of this fund but it will also bring new competitors in the Oil & Gas Operations industry.
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 Suburban Propane Partners LP.
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 Suburban Propane Partners LP business can come under increasing regulations regarding data privacy, data security, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Suburban Propane Partners LP 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 Suburban Propane Partners LP prominent markets.
Consumer confidence and its impact on Suburban Propane Partners LP 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 Oil & Gas Operations industry and other sectors.
Weighted SWOT Analysis of Suburban Propane Partners LP Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Suburban Propane Partners LP 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 Suburban Propane Partners LP 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 Suburban Propane Partners LP 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 Suburban Propane Partners LP 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 Suburban Propane Partners LP needs to make to build a sustainable competitive advantage.