SWOT Analysis / TOWS Matrix for Wollongong Coal (Australia)
Based on various researches at Oak Spring University , Wollongong Coal is operating in a macro-environment that has been destablized by – supply chains are disrupted by pandemic , challanges to central banks by blockchain based private currencies, digital marketing is dominated by two big players Facebook and Google, increasing household debt because of falling income levels, wage bills are increasing, geopolitical disruptions, talent flight as more people leaving formal jobs,
central banks are concerned over increasing inflation, increasing inequality as vast percentage of new income is going to the top 1%, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Wollongong Coal can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Wollongong Coal, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Wollongong Coal 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 Wollongong Coal can be done for the following purposes –
1. Strategic planning of Wollongong Coal
2. Improving business portfolio management of Wollongong Coal
3. Assessing feasibility of the new initiative in Australia
4. Making a Coal sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Wollongong Coal
Strengths of Wollongong Coal | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Wollongong Coal are -
High switching costs
– The high switching costs that Wollongong Coal 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.
Successful track record of launching new products
– Wollongong Coal has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Wollongong Coal has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Highly skilled collaborators
– Wollongong Coal has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Coal industry. Secondly the value chain collaborators of Wollongong Coal have helped the firm to develop new products and bring them quickly to the marketplace.
Cross disciplinary teams
– Horizontal connected teams at the Wollongong Coal 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.
Sustainable margins compare to other players in Coal industry
– Wollongong Coal has clearly differentiated products in the market place. This has enabled Wollongong Coal to fetch slight price premium compare to the competitors in the Coal industry. The sustainable margins have also helped Wollongong Coal to invest into research and development (R&D) and innovation.
Ability to lead change in Coal
– Wollongong Coal is one of the leading players in the Coal industry in Australia. Over the years it has not only transformed the business landscape in the Coal industry in Australia but also across the existing markets. The ability to lead change has enabled Wollongong Coal in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Learning organization
- Wollongong Coal 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 Wollongong Coal is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Wollongong Coal emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– Wollongong Coal is one of the most innovative firm in Coal sector.
Operational resilience
– The operational resilience strategy of Wollongong Coal comprises – understanding the underlying the factors in the Coal 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.
Superior customer experience
– The customer experience strategy of Wollongong Coal in Coal industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to recruit top talent
– Wollongong Coal is one of the leading players in the Coal industry in Australia. It is in a position to attract the best talent available in Australia. The firm has a robust talent identification program that helps in identifying the brightest.
Organizational Resilience of Wollongong Coal
– The covid-19 pandemic has put organizational resilience at the centre of everthing Wollongong Coal does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses of Wollongong Coal | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Wollongong Coal are -
Lack of clear differentiation of Wollongong Coal products
– To increase the profitability and margins on the products, Wollongong Coal needs to provide more differentiated products than what it is currently offering in the marketplace.
Products dominated business model
– Even though Wollongong Coal has some of the most successful models in the Coal industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Wollongong Coal should strive to include more intangible value offerings along with its core products and services.
Capital Spending Reduction
– Even during the low interest decade, Wollongong Coal 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 Coal industry using digital technology.
Compensation and incentives
– The revenue per employee of Wollongong Coal is just above the Coal 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Wollongong Coal is slow explore the new channels of communication. These new channels of communication can help Wollongong Coal to provide better information regarding Coal products and services. It can also build an online community to further reach out to potential customers.
High dependence on Wollongong Coal ‘s star products
– The top 2 products and services of Wollongong Coal still accounts for major business revenue. This dependence on star products in Coal industry has resulted into insufficient focus on developing new products, even though Wollongong Coal has relatively successful track record of launching new products.
Ability to respond to the competition
– As the decision making is very deliberative at Wollongong Coal, in the dynamic environment of Coal industry it has struggled to respond to the nimble upstart competition. Wollongong Coal has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow decision making process
– As mentioned earlier in the report, Wollongong Coal has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Coal industry over the last five years. Wollongong Coal 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 Coal industry, Wollongong Coal 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.
Increasing silos among functional specialists
– The organizational structure of Wollongong Coal is dominated by functional specialists. It is not different from other players in the Coal industry, but Wollongong Coal needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Wollongong Coal to focus more on services in the Coal industry rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As Wollongong Coal is one of the leading players in the Coal industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Coal industry in last five years.
Wollongong Coal Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Wollongong Coal are -
Using analytics as competitive advantage
– Wollongong Coal has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Coal sector. This continuous investment in analytics has enabled Wollongong Coal to build a competitive advantage using analytics. The analytics driven competitive advantage can help Wollongong Coal to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Building a culture of innovation
– managers at Wollongong Coal can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Coal industry.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Wollongong Coal can use these opportunities to build new business models that can help the communities that Wollongong Coal operates in. Secondly it can use opportunities from government spending in Coal sector.
Low interest rates
– Even though inflation is raising its head in most developed economies, Wollongong Coal 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.
Manufacturing automation
– Wollongong Coal can use the latest technology developments to improve its manufacturing and designing process in Coal 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Wollongong Coal 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 Wollongong Coal to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Developing new processes and practices
– Wollongong Coal can develop new processes and procedures in Coal 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Coal industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Wollongong Coal 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. Wollongong Coal 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Wollongong Coal 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 Wollongong Coal to hire the very best people irrespective of their geographical location.
Creating value in data economy
– The success of analytics program of Wollongong Coal has opened avenues for new revenue streams for the organization in Coal industry. This can help Wollongong Coal to build a more holistic ecosystem for Wollongong Coal products in the Coal industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Coal industry, but it has also influenced the consumer preferences. Wollongong Coal can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Better consumer reach
– The expansion of the 5G network will help Wollongong Coal to increase its market reach. Wollongong Coal will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Leveraging digital technologies
– Wollongong Coal 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.
Threats Wollongong Coal External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Wollongong Coal are -
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 Wollongong Coal in the Coal sector and impact the bottomline of the organization.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Wollongong Coal may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Coal sector.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Wollongong Coal in Coal industry. The Coal 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.
Easy access to finance
– Easy access to finance in Coal industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Wollongong Coal can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Wollongong Coal needs to understand the core reasons impacting the Coal industry. This will help it in building a better workplace.
Technology acceleration in Forth Industrial Revolution
– Wollongong Coal has witnessed rapid integration of technology during Covid-19 in the Coal industry. As one of the leading players in the industry, Wollongong Coal needs to keep up with the evolution of technology in the Coal 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.
Shortening product life cycle
– it is one of the major threat that Wollongong Coal is facing in Coal sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Consumer confidence and its impact on Wollongong Coal 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 Coal industry and other sectors.
Increasing wage structure of Wollongong Coal
– 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 Wollongong Coal.
Environmental challenges
– Wollongong Coal 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. Wollongong Coal can take advantage of this fund but it will also bring new competitors in the Coal industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Wollongong Coal 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 Wollongong Coal prominent markets.
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 Wollongong Coal business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Wollongong Coal 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.
Weighted SWOT Analysis of Wollongong Coal Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Wollongong Coal 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 Wollongong Coal 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 Wollongong Coal 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 Wollongong Coal 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 Wollongong Coal needs to make to build a sustainable competitive advantage.