Elec-Tech Int A (2005) SWOT Analysis / TOWS Matrix / MBA Resources
Appliance & Tool
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Elec-Tech Int A (China)
Based on various researches at Oak Spring University , Elec-Tech Int A is operating in a macro-environment that has been destablized by – wage bills are increasing, central banks are concerned over increasing inflation, increasing household debt because of falling income levels, technology disruption, increasing energy prices, supply chains are disrupted by pandemic , increasing commodity prices,
there is backlash against globalization, digital marketing is dominated by two big players Facebook and Google, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Elec-Tech Int A can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Elec-Tech Int A, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Elec-Tech Int A 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 Elec-Tech Int A can be done for the following purposes –
1. Strategic planning of Elec-Tech Int A
2. Improving business portfolio management of Elec-Tech Int A
3. Assessing feasibility of the new initiative in China
4. Making a Appliance & Tool sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Elec-Tech Int A
Strengths of Elec-Tech Int A | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Elec-Tech Int A are -
Training and development
– Elec-Tech Int A has one of the best training and development program in Consumer Cyclical 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.
Sustainable margins compare to other players in Appliance & Tool industry
– Elec-Tech Int A has clearly differentiated products in the market place. This has enabled Elec-Tech Int A to fetch slight price premium compare to the competitors in the Appliance & Tool industry. The sustainable margins have also helped Elec-Tech Int A to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Elec-Tech Int A 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.
High brand equity
– Elec-Tech Int A has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Elec-Tech Int A to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Strong track record of project management in the Appliance & Tool industry
– Elec-Tech Int A is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Low bargaining power of suppliers
– Suppliers of Elec-Tech Int A in the Consumer Cyclical sector have low bargaining power. Elec-Tech Int A has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Elec-Tech Int A to manage not only supply disruptions but also source products at highly competitive prices.
Highly skilled collaborators
– Elec-Tech Int A has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Appliance & Tool industry. Secondly the value chain collaborators of Elec-Tech Int A have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Elec-Tech Int A is one of the most innovative firm in Appliance & Tool sector.
Digital Transformation in Appliance & Tool industry
- digital transformation varies from industry to industry. For Elec-Tech Int A digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Elec-Tech Int A 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.
Superior customer experience
– The customer experience strategy of Elec-Tech Int A in Appliance & Tool industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Analytics focus
– Elec-Tech Int A 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 Appliance & Tool industry. The technology infrastructure of China 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.
Organizational Resilience of Elec-Tech Int A
– The covid-19 pandemic has put organizational resilience at the centre of everthing Elec-Tech Int A does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses of Elec-Tech Int A | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Elec-Tech Int A are -
Aligning sales with marketing
– From the outside it seems that Elec-Tech Int A needs to have more collaboration between its sales team and marketing team. Sales professionals in the Appliance & Tool industry have deep experience in developing customer relationships. Marketing department at Elec-Tech Int A can leverage the sales team experience to cultivate customer relationships as Elec-Tech Int A is planning to shift buying processes online.
Products dominated business model
– Even though Elec-Tech Int A has some of the most successful models in the Appliance & Tool industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Elec-Tech Int A should strive to include more intangible value offerings along with its core products and services.
High cash cycle compare to competitors
Elec-Tech Int A has a high cash cycle compare to other players in the Appliance & Tool industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
High bargaining power of channel partners in Appliance & Tool industry
– because of the regulatory requirements in China, Elec-Tech Int A 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 Appliance & Tool industry.
Employees’ less understanding of Elec-Tech Int A strategy
– From the outside it seems that the employees of Elec-Tech Int A 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, Elec-Tech Int A 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 Appliance & Tool industry using digital technology.
Ability to respond to the competition
– As the decision making is very deliberative at Elec-Tech Int A, in the dynamic environment of Appliance & Tool industry it has struggled to respond to the nimble upstart competition. Elec-Tech Int A has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Increasing silos among functional specialists
– The organizational structure of Elec-Tech Int A is dominated by functional specialists. It is not different from other players in the Appliance & Tool industry, but Elec-Tech Int A needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Elec-Tech Int A to focus more on services in the Appliance & Tool industry rather than just following the product oriented approach.
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 Elec-Tech Int A supply chain. Even after few cautionary changes, Elec-Tech Int A is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Elec-Tech Int A vulnerable to further global disruptions in South East Asia.
Low market penetration in new markets
– Outside its home market of China, Elec-Tech Int A needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Interest costs
– Compare to the competition, Elec-Tech Int A 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.
Elec-Tech Int A Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Elec-Tech Int A are -
Using analytics as competitive advantage
– Elec-Tech Int A has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Appliance & Tool sector. This continuous investment in analytics has enabled Elec-Tech Int A to build a competitive advantage using analytics. The analytics driven competitive advantage can help Elec-Tech Int A to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Elec-Tech Int A can use these opportunities to build new business models that can help the communities that Elec-Tech Int A operates in. Secondly it can use opportunities from government spending in Appliance & Tool sector.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Elec-Tech Int A can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Learning at scale
– Online learning technologies has now opened space for Elec-Tech Int A 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Elec-Tech Int A is facing challenges because of the dominance of functional experts in the organization. Elec-Tech Int A can utilize new technology in the field of Appliance & Tool industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Elec-Tech Int A to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Buying journey improvements
– Elec-Tech Int A can improve the customer journey of consumers in the Appliance & Tool 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Appliance & Tool industry, but it has also influenced the consumer preferences. Elec-Tech Int A can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Appliance & Tool industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Elec-Tech Int A 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. Elec-Tech Int A 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.
Use of Bitcoin and other crypto currencies for transactions in Appliance & Tool industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Elec-Tech Int A in the Appliance & Tool industry. Now Elec-Tech Int A can target international markets with far fewer capital restrictions requirements than the existing system.
Leveraging digital technologies
– Elec-Tech Int A 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.
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. Elec-Tech Int A can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Creating value in data economy
– The success of analytics program of Elec-Tech Int A has opened avenues for new revenue streams for the organization in Appliance & Tool industry. This can help Elec-Tech Int A to build a more holistic ecosystem for Elec-Tech Int A products in the Appliance & Tool industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Threats Elec-Tech Int A External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Elec-Tech Int A are -
Stagnating economy with rate increase
– Elec-Tech Int A 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 Appliance & Tool industry.
Environmental challenges
– Elec-Tech Int A 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. Elec-Tech Int A can take advantage of this fund but it will also bring new competitors in the Appliance & Tool industry.
High dependence on third party suppliers
– Elec-Tech Int A 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Elec-Tech Int A may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Appliance & Tool sector.
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.
Regulatory challenges
– Elec-Tech Int A 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 Appliance & Tool industry regulations.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Elec-Tech Int A 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 Elec-Tech Int A prominent markets.
Technology acceleration in Forth Industrial Revolution
– Elec-Tech Int A has witnessed rapid integration of technology during Covid-19 in the Appliance & Tool industry. As one of the leading players in the industry, Elec-Tech Int A needs to keep up with the evolution of technology in the Appliance & Tool 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.
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. Elec-Tech Int A 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.
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. Elec-Tech Int A needs to understand the core reasons impacting the Appliance & Tool industry. This will help it in building a better workplace.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Elec-Tech Int A in Appliance & Tool industry. The Appliance & Tool 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.
Consumer confidence and its impact on Elec-Tech Int A 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 Appliance & Tool industry and other sectors.
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 Elec-Tech Int A in the Appliance & Tool sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Elec-Tech Int A Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Elec-Tech Int A 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 Elec-Tech Int A 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 Elec-Tech Int A 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 Elec-Tech Int A 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 Elec-Tech Int A needs to make to build a sustainable competitive advantage.