April (APRL) SWOT Analysis / TOWS Matrix / MBA Resources
Insurance (Miscellaneous)
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for April (France)
Based on various researches at Oak Spring University , April is operating in a macro-environment that has been destablized by – increasing energy prices, digital marketing is dominated by two big players Facebook and Google, competitive advantages are harder to sustain because of technology dispersion, increasing transportation and logistics costs, increasing inequality as vast percentage of new income is going to the top 1%, increasing household debt because of falling income levels, there is increasing trade war between United States & China,
wage bills are increasing, there is backlash against globalization, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that April can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the April, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which April 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 April can be done for the following purposes –
1. Strategic planning of April
2. Improving business portfolio management of April
3. Assessing feasibility of the new initiative in France
4. Making a Insurance (Miscellaneous) sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of April
Strengths of April | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of April are -
High switching costs
– The high switching costs that April 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.
Operational resilience
– The operational resilience strategy of April comprises – understanding the underlying the factors in the Insurance (Miscellaneous) 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.
Effective Research and Development (R&D)
– April has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – April staying ahead in the Insurance (Miscellaneous) industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Learning organization
- April 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 April is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at April emphasize – knowledge, initiative, and innovation.
Organizational Resilience of April
– The covid-19 pandemic has put organizational resilience at the centre of everthing April does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– April has one of the best training and development program in Financial 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.
Analytics focus
– April 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 Insurance (Miscellaneous) industry. The technology infrastructure of France 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.
Strong track record of project management in the Insurance (Miscellaneous) industry
– April is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Innovation driven organization
– April is one of the most innovative firm in Insurance (Miscellaneous) sector.
Superior customer experience
– The customer experience strategy of April in Insurance (Miscellaneous) industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High brand equity
– April has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled April to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of April in the Financial sector have low bargaining power. April has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps April to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses of April | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of April are -
Interest costs
– Compare to the competition, April 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.
Skills based hiring in Insurance (Miscellaneous) industry
– The stress on hiring functional specialists at April 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.
Lack of clear differentiation of April products
– To increase the profitability and margins on the products, April needs to provide more differentiated products than what it is currently offering in the marketplace.
High operating costs
– Compare to the competitors, April has high operating costs in the Insurance (Miscellaneous) industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract April lucrative customers.
Low market penetration in new markets
– Outside its home market of France, April needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to strategic competitive environment developments
– As April is one of the leading players in the Insurance (Miscellaneous) industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Insurance (Miscellaneous) industry in last five years.
Products dominated business model
– Even though April has some of the most successful models in the Insurance (Miscellaneous) industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. April should strive to include more intangible value offerings along with its core products and services.
Ability to respond to the competition
– As the decision making is very deliberative at April, in the dynamic environment of Insurance (Miscellaneous) industry it has struggled to respond to the nimble upstart competition. April has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Capital Spending Reduction
– Even during the low interest decade, April 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 Insurance (Miscellaneous) industry using digital technology.
Aligning sales with marketing
– From the outside it seems that April needs to have more collaboration between its sales team and marketing team. Sales professionals in the Insurance (Miscellaneous) industry have deep experience in developing customer relationships. Marketing department at April can leverage the sales team experience to cultivate customer relationships as April is planning to shift buying processes online.
High bargaining power of channel partners in Insurance (Miscellaneous) industry
– because of the regulatory requirements in France, April 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 Insurance (Miscellaneous) industry.
April Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of April are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for April in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Insurance (Miscellaneous) industry, and it will provide faster access to the consumers.
Leveraging digital technologies
– April 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects April can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Insurance (Miscellaneous) industry, but it has also influenced the consumer preferences. April can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Using analytics as competitive advantage
– April has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Insurance (Miscellaneous) sector. This continuous investment in analytics has enabled April to build a competitive advantage using analytics. The analytics driven competitive advantage can help April 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 April 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 Insurance (Miscellaneous) 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, April can use these opportunities to build new business models that can help the communities that April operates in. Secondly it can use opportunities from government spending in Insurance (Miscellaneous) sector.
Manufacturing automation
– April can use the latest technology developments to improve its manufacturing and designing process in Insurance (Miscellaneous) 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.
Creating value in data economy
– The success of analytics program of April has opened avenues for new revenue streams for the organization in Insurance (Miscellaneous) industry. This can help April to build a more holistic ecosystem for April products in the Insurance (Miscellaneous) industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, April 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 April to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Better consumer reach
– The expansion of the 5G network will help April to increase its market reach. April 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 April 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.
Use of Bitcoin and other crypto currencies for transactions in Insurance (Miscellaneous) industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for April in the Insurance (Miscellaneous) industry. Now April can target international markets with far fewer capital restrictions requirements than the existing system.
Threats April External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of April are -
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. April 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
– April 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. April can take advantage of this fund but it will also bring new competitors in the Insurance (Miscellaneous) industry.
Stagnating economy with rate increase
– April 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 Insurance (Miscellaneous) industry.
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 April in the Insurance (Miscellaneous) sector and impact the bottomline of the organization.
Regulatory challenges
– April 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 Insurance (Miscellaneous) industry regulations.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Insurance (Miscellaneous) industry are lowering. It can presents April with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Insurance (Miscellaneous) sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, April 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 April prominent markets.
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 April
– 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 April.
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. April needs to understand the core reasons impacting the Insurance (Miscellaneous) industry. This will help it in building a better workplace.
Consumer confidence and its impact on April 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 Insurance (Miscellaneous) industry and other sectors.
Easy access to finance
– Easy access to finance in Insurance (Miscellaneous) industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. April can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
High dependence on third party suppliers
– April 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 April Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at April 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 April 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 April 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 April 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 April needs to make to build a sustainable competitive advantage.