Based on various researches at Oak Spring University , Gifore Agricultural Machinery Chain is operating in a macro-environment that has been destablized by – challanges to central banks by blockchain based private currencies, increasing energy prices, increasing inequality as vast percentage of new income is going to the top 1%, increasing commodity prices, talent flight as more people leaving formal jobs, geopolitical disruptions, increasing government debt because of Covid-19 spendings,
customer relationship management is fast transforming because of increasing concerns over data privacy, wage bills are increasing, etc
Introduction to SWOT Analysis of Gifore Agricultural Machinery Chain
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Gifore Agricultural Machinery Chain can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Gifore Agricultural Machinery Chain, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Gifore Agricultural Machinery Chain 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 Gifore Agricultural Machinery Chain can be done for the following purposes –
1. Strategic planning of Gifore Agricultural Machinery Chain
2. Improving business portfolio management of Gifore Agricultural Machinery Chain
3. Assessing feasibility of the new initiative in China
4. Making a Constr. & Agric. Machinery sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Gifore Agricultural Machinery Chain
Strengths of Gifore Agricultural Machinery Chain | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Gifore Agricultural Machinery Chain are -
High switching costs
– The high switching costs that Gifore Agricultural Machinery Chain 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.
Superior customer experience
– The customer experience strategy of Gifore Agricultural Machinery Chain in Constr. & Agric. Machinery industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High brand equity
– Gifore Agricultural Machinery Chain has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Gifore Agricultural Machinery Chain to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Effective Research and Development (R&D)
– Gifore Agricultural Machinery Chain has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Gifore Agricultural Machinery Chain staying ahead in the Constr. & Agric. Machinery industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Highly skilled collaborators
– Gifore Agricultural Machinery Chain has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Constr. & Agric. Machinery industry. Secondly the value chain collaborators of Gifore Agricultural Machinery Chain have helped the firm to develop new products and bring them quickly to the marketplace.
Low bargaining power of suppliers
– Suppliers of Gifore Agricultural Machinery Chain in the Capital Goods sector have low bargaining power. Gifore Agricultural Machinery Chain has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Gifore Agricultural Machinery Chain to manage not only supply disruptions but also source products at highly competitive prices.
Innovation driven organization
– Gifore Agricultural Machinery Chain is one of the most innovative firm in Constr. & Agric. Machinery sector.
Sustainable margins compare to other players in Constr. & Agric. Machinery industry
– Gifore Agricultural Machinery Chain has clearly differentiated products in the market place. This has enabled Gifore Agricultural Machinery Chain to fetch slight price premium compare to the competitors in the Constr. & Agric. Machinery industry. The sustainable margins have also helped Gifore Agricultural Machinery Chain to invest into research and development (R&D) and innovation.
Training and development
– Gifore Agricultural Machinery Chain has one of the best training and development program in Capital Goods 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.
Cross disciplinary teams
– Horizontal connected teams at the Gifore Agricultural Machinery Chain 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.
Digital Transformation in Constr. & Agric. Machinery industry
- digital transformation varies from industry to industry. For Gifore Agricultural Machinery Chain digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Gifore Agricultural Machinery Chain 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 recruit top talent
– Gifore Agricultural Machinery Chain is one of the leading players in the Constr. & Agric. Machinery industry in China. It is in a position to attract the best talent available in China. The firm has a robust talent identification program that helps in identifying the brightest.
Weaknesses of Gifore Agricultural Machinery Chain | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Gifore Agricultural Machinery Chain are -
Interest costs
– Compare to the competition, Gifore Agricultural Machinery Chain 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 dependence on Gifore Agricultural Machinery Chain ‘s star products
– The top 2 products and services of Gifore Agricultural Machinery Chain still accounts for major business revenue. This dependence on star products in Constr. & Agric. Machinery industry has resulted into insufficient focus on developing new products, even though Gifore Agricultural Machinery Chain has relatively successful track record of launching new products.
Ability to respond to the competition
– As the decision making is very deliberative at Gifore Agricultural Machinery Chain, in the dynamic environment of Constr. & Agric. Machinery industry it has struggled to respond to the nimble upstart competition. Gifore Agricultural Machinery Chain has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Need for greater diversity
– Gifore Agricultural Machinery Chain 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.
High operating costs
– Compare to the competitors, Gifore Agricultural Machinery Chain has high operating costs in the Constr. & Agric. Machinery industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Gifore Agricultural Machinery Chain lucrative customers.
Slow decision making process
– As mentioned earlier in the report, Gifore Agricultural Machinery Chain has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Constr. & Agric. Machinery industry over the last five years. Gifore Agricultural Machinery Chain even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Workers concerns about automation
– As automation is fast increasing in the Constr. & Agric. Machinery industry, Gifore Agricultural Machinery Chain 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.
High bargaining power of channel partners in Constr. & Agric. Machinery industry
– because of the regulatory requirements in China, Gifore Agricultural Machinery Chain 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 Constr. & Agric. Machinery industry.
Increasing silos among functional specialists
– The organizational structure of Gifore Agricultural Machinery Chain is dominated by functional specialists. It is not different from other players in the Constr. & Agric. Machinery industry, but Gifore Agricultural Machinery Chain needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Gifore Agricultural Machinery Chain to focus more on services in the Constr. & Agric. Machinery industry rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As Gifore Agricultural Machinery Chain is one of the leading players in the Constr. & Agric. Machinery industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Constr. & Agric. Machinery industry in last five years.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Gifore Agricultural Machinery Chain is slow explore the new channels of communication. These new channels of communication can help Gifore Agricultural Machinery Chain to provide better information regarding Constr. & Agric. Machinery products and services. It can also build an online community to further reach out to potential customers.
Gifore Agricultural Machinery Chain Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Gifore Agricultural Machinery Chain are -
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 Gifore Agricultural Machinery Chain 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Gifore Agricultural Machinery Chain 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 Gifore Agricultural Machinery Chain to hire the very best people irrespective of their geographical location.
Use of Bitcoin and other crypto currencies for transactions in Constr. & Agric. Machinery industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Gifore Agricultural Machinery Chain in the Constr. & Agric. Machinery industry. Now Gifore Agricultural Machinery Chain can target international markets with far fewer capital restrictions requirements than the existing system.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Gifore Agricultural Machinery Chain 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 Gifore Agricultural Machinery Chain to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Low interest rates
– Even though inflation is raising its head in most developed economies, Gifore Agricultural Machinery Chain 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.
Using analytics as competitive advantage
– Gifore Agricultural Machinery Chain has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Constr. & Agric. Machinery sector. This continuous investment in analytics has enabled Gifore Agricultural Machinery Chain to build a competitive advantage using analytics. The analytics driven competitive advantage can help Gifore Agricultural Machinery Chain to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Gifore Agricultural Machinery Chain can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Developing new processes and practices
– Gifore Agricultural Machinery Chain can develop new processes and procedures in Constr. & Agric. Machinery 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.
Loyalty marketing
– Gifore Agricultural Machinery Chain 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Gifore Agricultural Machinery Chain in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Constr. & Agric. Machinery industry, and it will provide faster access to the consumers.
Learning at scale
– Online learning technologies has now opened space for Gifore Agricultural Machinery Chain 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, Gifore Agricultural Machinery Chain can use these opportunities to build new business models that can help the communities that Gifore Agricultural Machinery Chain operates in. Secondly it can use opportunities from government spending in Constr. & Agric. Machinery sector.
Creating value in data economy
– The success of analytics program of Gifore Agricultural Machinery Chain has opened avenues for new revenue streams for the organization in Constr. & Agric. Machinery industry. This can help Gifore Agricultural Machinery Chain to build a more holistic ecosystem for Gifore Agricultural Machinery Chain products in the Constr. & Agric. Machinery industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Threats Gifore Agricultural Machinery Chain External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Gifore Agricultural Machinery Chain are -
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 Gifore Agricultural Machinery Chain business can come under increasing regulations regarding data privacy, data security, etc.
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.
Technology acceleration in Forth Industrial Revolution
– Gifore Agricultural Machinery Chain has witnessed rapid integration of technology during Covid-19 in the Constr. & Agric. Machinery industry. As one of the leading players in the industry, Gifore Agricultural Machinery Chain needs to keep up with the evolution of technology in the Constr. & Agric. Machinery 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.
Consumer confidence and its impact on Gifore Agricultural Machinery Chain 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 Constr. & Agric. Machinery 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. Gifore Agricultural Machinery Chain needs to understand the core reasons impacting the Constr. & Agric. Machinery industry. This will help it in building a better workplace.
Regulatory challenges
– Gifore Agricultural Machinery Chain 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 Constr. & Agric. Machinery industry regulations.
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 Gifore Agricultural Machinery Chain in the Constr. & Agric. Machinery sector and impact the bottomline of the organization.
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Gifore Agricultural Machinery Chain in Constr. & Agric. Machinery industry. The Constr. & Agric. Machinery 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Constr. & Agric. Machinery industry are lowering. It can presents Gifore Agricultural Machinery Chain with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Constr. & Agric. Machinery sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Gifore Agricultural Machinery Chain 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 Gifore Agricultural Machinery Chain prominent markets.
Stagnating economy with rate increase
– Gifore Agricultural Machinery Chain 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 Constr. & Agric. Machinery industry.
Shortening product life cycle
– it is one of the major threat that Gifore Agricultural Machinery Chain is facing in Constr. & Agric. Machinery sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Gifore Agricultural Machinery Chain Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Gifore Agricultural Machinery Chain 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 Gifore Agricultural Machinery Chain 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 Gifore Agricultural Machinery Chain 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 Gifore Agricultural Machinery Chain 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 Gifore Agricultural Machinery Chain needs to make to build a sustainable competitive advantage.