SWOT Analysis / TOWS Matrix for Korian Medica (France)
Based on various researches at Oak Spring University , Korian Medica is operating in a macro-environment that has been destablized by – challanges to central banks by blockchain based private currencies, wage bills are increasing, talent flight as more people leaving formal jobs, competitive advantages are harder to sustain because of technology dispersion, increasing household debt because of falling income levels, central banks are concerned over increasing inflation, technology disruption,
increasing energy prices, there is backlash against globalization, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Korian Medica can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Korian Medica, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Korian Medica 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 Korian Medica can be done for the following purposes –
1. Strategic planning of Korian Medica
2. Improving business portfolio management of Korian Medica
3. Assessing feasibility of the new initiative in France
4. Making a Healthcare Facilities sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Korian Medica
Strengths of Korian Medica | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Korian Medica are -
Ability to recruit top talent
– Korian Medica is one of the leading players in the Healthcare Facilities industry in France. It is in a position to attract the best talent available in France. The firm has a robust talent identification program that helps in identifying the brightest.
Organizational Resilience of Korian Medica
– The covid-19 pandemic has put organizational resilience at the centre of everthing Korian Medica does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Innovation driven organization
– Korian Medica is one of the most innovative firm in Healthcare Facilities sector.
High switching costs
– The high switching costs that Korian Medica 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.
Low bargaining power of suppliers
– Suppliers of Korian Medica in the Healthcare sector have low bargaining power. Korian Medica has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Korian Medica to manage not only supply disruptions but also source products at highly competitive prices.
Digital Transformation in Healthcare Facilities industry
- digital transformation varies from industry to industry. For Korian Medica digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Korian Medica 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.
High brand equity
– Korian Medica has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Korian Medica to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in Healthcare Facilities industry
– Korian Medica has clearly differentiated products in the market place. This has enabled Korian Medica to fetch slight price premium compare to the competitors in the Healthcare Facilities industry. The sustainable margins have also helped Korian Medica to invest into research and development (R&D) and innovation.
Training and development
– Korian Medica has one of the best training and development program in Healthcare 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.
Operational resilience
– The operational resilience strategy of Korian Medica comprises – understanding the underlying the factors in the Healthcare Facilities 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.
Successful track record of launching new products
– Korian Medica has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Korian Medica 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.
Effective Research and Development (R&D)
– Korian Medica has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Korian Medica staying ahead in the Healthcare Facilities industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses of Korian Medica | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Korian Medica are -
Increasing silos among functional specialists
– The organizational structure of Korian Medica is dominated by functional specialists. It is not different from other players in the Healthcare Facilities industry, but Korian Medica needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Korian Medica to focus more on services in the Healthcare Facilities industry rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As Korian Medica is one of the leading players in the Healthcare Facilities industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Healthcare Facilities industry in last five years.
Slow decision making process
– As mentioned earlier in the report, Korian Medica has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Healthcare Facilities industry over the last five years. Korian Medica 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.
Low market penetration in new markets
– Outside its home market of France, Korian Medica needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
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 Korian Medica supply chain. Even after few cautionary changes, Korian Medica is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Korian Medica vulnerable to further global disruptions in South East Asia.
Need for greater diversity
– Korian Medica 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.
Employees’ less understanding of Korian Medica strategy
– From the outside it seems that the employees of Korian Medica 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.
Ability to respond to the competition
– As the decision making is very deliberative at Korian Medica, in the dynamic environment of Healthcare Facilities industry it has struggled to respond to the nimble upstart competition. Korian Medica has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High operating costs
– Compare to the competitors, Korian Medica has high operating costs in the Healthcare Facilities industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Korian Medica lucrative customers.
No frontier risks strategy
– From the 10K / annual statement of Korian Medica, it seems that company is thinking out the frontier risks that can impact Healthcare Facilities industry. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Skills based hiring in Healthcare Facilities industry
– The stress on hiring functional specialists at Korian Medica has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Korian Medica Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Korian Medica are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Korian Medica is facing challenges because of the dominance of functional experts in the organization. Korian Medica can utilize new technology in the field of Healthcare Facilities industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Healthcare Facilities industry, but it has also influenced the consumer preferences. Korian Medica can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Korian Medica can use these opportunities to build new business models that can help the communities that Korian Medica operates in. Secondly it can use opportunities from government spending in Healthcare Facilities sector.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Korian Medica in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Healthcare Facilities industry, and it will provide faster access to the consumers.
Using analytics as competitive advantage
– Korian Medica has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Healthcare Facilities sector. This continuous investment in analytics has enabled Korian Medica to build a competitive advantage using analytics. The analytics driven competitive advantage can help Korian Medica to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Leveraging digital technologies
– Korian Medica 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.
Better consumer reach
– The expansion of the 5G network will help Korian Medica to increase its market reach. Korian Medica 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.
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 Korian Medica 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.
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. Korian Medica can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Loyalty marketing
– Korian Medica 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.
Manufacturing automation
– Korian Medica can use the latest technology developments to improve its manufacturing and designing process in Healthcare Facilities 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.
Building a culture of innovation
– managers at Korian Medica 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 Healthcare Facilities industry.
Low interest rates
– Even though inflation is raising its head in most developed economies, Korian Medica 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.
Threats Korian Medica External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Korian Medica are -
Technology acceleration in Forth Industrial Revolution
– Korian Medica has witnessed rapid integration of technology during Covid-19 in the Healthcare Facilities industry. As one of the leading players in the industry, Korian Medica needs to keep up with the evolution of technology in the Healthcare Facilities 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.
Increasing wage structure of Korian Medica
– 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 Korian Medica.
Consumer confidence and its impact on Korian Medica 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 Healthcare Facilities 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. Korian Medica needs to understand the core reasons impacting the Healthcare Facilities industry. This will help it in building a better workplace.
Easy access to finance
– Easy access to finance in Healthcare Facilities industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Korian Medica can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Korian Medica 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 Korian Medica prominent markets.
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 Korian Medica in the Healthcare Facilities sector and impact the bottomline of the organization.
Environmental challenges
– Korian Medica 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. Korian Medica can take advantage of this fund but it will also bring new competitors in the Healthcare Facilities industry.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Korian Medica in Healthcare Facilities industry. The Healthcare Facilities 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.
High dependence on third party suppliers
– Korian Medica 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.
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 Korian Medica business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Korian Medica 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 Healthcare Facilities industry.
Shortening product life cycle
– it is one of the major threat that Korian Medica is facing in Healthcare Facilities sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Korian Medica Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Korian Medica 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 Korian Medica 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 Korian Medica 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 Korian Medica 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 Korian Medica needs to make to build a sustainable competitive advantage.
