Immersion SA (ALIMR) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Immersion SA (France)

Based on various researches at Oak Spring University , Immersion SA is operating in a macro-environment that has been destablized by – increasing transportation and logistics costs, digital marketing is dominated by two big players Facebook and Google, there is backlash against globalization, customer relationship management is fast transforming because of increasing concerns over data privacy, challanges to central banks by blockchain based private currencies, cloud computing is disrupting traditional business models, supply chains are disrupted by pandemic , competitive advantages are harder to sustain because of technology dispersion, wage bills are increasing, etc

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Introduction to SWOT Analysis of Immersion SA

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Immersion SA can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Immersion SA, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Immersion SA 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of Immersion SA can be done for the following purposes –
1. Strategic planning of Immersion SA
2. Improving business portfolio management of Immersion SA
3. Assessing feasibility of the new initiative in France
4. Making a Motion Pictures sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Immersion SA

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Strengths of Immersion SA | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Immersion SA are -

Strong track record of project management in the Motion Pictures industry

– Immersion SA is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Superior customer experience

– The customer experience strategy of Immersion SA in Motion Pictures industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Effective Research and Development (R&D)

– Immersion SA has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Immersion SA staying ahead in the Motion Pictures industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

High brand equity

– Immersion SA has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Immersion SA to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Diverse revenue streams

– Immersion SA is present in almost all the verticals within the Motion Pictures industry. This has provided Immersion SA a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.

Innovation driven organization

– Immersion SA is one of the most innovative firm in Motion Pictures sector.

Highly skilled collaborators

– Immersion SA has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Motion Pictures industry. Secondly the value chain collaborators of Immersion SA have helped the firm to develop new products and bring them quickly to the marketplace.

Ability to lead change in Motion Pictures

– Immersion SA is one of the leading players in the Motion Pictures industry in France. Over the years it has not only transformed the business landscape in the Motion Pictures industry in France but also across the existing markets. The ability to lead change has enabled Immersion SA in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

Analytics focus

– Immersion SA 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 Motion Pictures 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.

Learning organization

- Immersion SA 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 Immersion SA is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Immersion SA emphasize – knowledge, initiative, and innovation.

Ability to recruit top talent

– Immersion SA is one of the leading players in the Motion Pictures 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.

Digital Transformation in Motion Pictures industry

- digital transformation varies from industry to industry. For Immersion SA digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Immersion SA 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.

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Weaknesses of Immersion SA | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Immersion SA are -

Ability to respond to the competition

– As the decision making is very deliberative at Immersion SA, in the dynamic environment of Motion Pictures industry it has struggled to respond to the nimble upstart competition. Immersion SA has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

Interest costs

– Compare to the competition, Immersion SA 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.

Lack of clear differentiation of Immersion SA products

– To increase the profitability and margins on the products, Immersion SA needs to provide more differentiated products than what it is currently offering in the marketplace.

High operating costs

– Compare to the competitors, Immersion SA has high operating costs in the Motion Pictures industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Immersion SA lucrative customers.

Capital Spending Reduction

– Even during the low interest decade, Immersion SA 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 Motion Pictures industry using digital technology.

Skills based hiring in Motion Pictures industry

– The stress on hiring functional specialists at Immersion SA 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.

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Immersion SA is slow explore the new channels of communication. These new channels of communication can help Immersion SA to provide better information regarding Motion Pictures products and services. It can also build an online community to further reach out to potential customers.

No frontier risks strategy

– From the 10K / annual statement of Immersion SA, it seems that company is thinking out the frontier risks that can impact Motion Pictures 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.

Aligning sales with marketing

– From the outside it seems that Immersion SA needs to have more collaboration between its sales team and marketing team. Sales professionals in the Motion Pictures industry have deep experience in developing customer relationships. Marketing department at Immersion SA can leverage the sales team experience to cultivate customer relationships as Immersion SA is planning to shift buying processes online.

High bargaining power of channel partners in Motion Pictures industry

– because of the regulatory requirements in France, Immersion SA 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 Motion Pictures industry.

High cash cycle compare to competitors

Immersion SA has a high cash cycle compare to other players in the Motion Pictures industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.

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Immersion SA Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of Immersion SA are -

Better consumer reach

– The expansion of the 5G network will help Immersion SA to increase its market reach. Immersion SA 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.

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. Immersion SA can explore opportunities that can attract volunteers and are consistent with its mission and vision.

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 Immersion SA 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.

Using analytics as competitive advantage

– Immersion SA has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Motion Pictures sector. This continuous investment in analytics has enabled Immersion SA to build a competitive advantage using analytics. The analytics driven competitive advantage can help Immersion SA to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.

Finding new ways to collaborate

– Covid-19 has not only transformed business models of companies in Motion Pictures industry, but it has also influenced the consumer preferences. Immersion SA 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 Motion Pictures industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Immersion SA 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. Immersion SA 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.

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects Immersion SA can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

Manufacturing automation

– Immersion SA can use the latest technology developments to improve its manufacturing and designing process in Motion Pictures 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.

Leveraging digital technologies

– Immersion SA 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.

Lowering marketing communication costs

– 5G expansion will open new opportunities for Immersion SA in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Motion Pictures industry, and it will provide faster access to the consumers.

Creating value in data economy

– The success of analytics program of Immersion SA has opened avenues for new revenue streams for the organization in Motion Pictures industry. This can help Immersion SA to build a more holistic ecosystem for Immersion SA products in the Motion Pictures industry by providing – data insight services, data privacy related products, data based consulting services, etc.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Immersion SA can use these opportunities to build new business models that can help the communities that Immersion SA operates in. Secondly it can use opportunities from government spending in Motion Pictures sector.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Immersion SA 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 Immersion SA to hire the very best people irrespective of their geographical location.

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Threats Immersion SA External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of Immersion SA are -

Barriers of entry lowering

– As technology is more democratized, the barriers to entry to Motion Pictures industry are lowering. It can presents Immersion SA with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Motion Pictures sector.

Increasing wage structure of Immersion SA

– 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 Immersion SA.

Stagnating economy with rate increase

– Immersion SA 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 Motion Pictures industry.

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. Immersion SA 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.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Immersion SA in Motion Pictures industry. The Motion Pictures 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.

Regulatory challenges

– Immersion SA 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 Motion Pictures industry regulations.

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 international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, Immersion SA 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 Immersion SA prominent markets.

Technology acceleration in Forth Industrial Revolution

– Immersion SA has witnessed rapid integration of technology during Covid-19 in the Motion Pictures industry. As one of the leading players in the industry, Immersion SA needs to keep up with the evolution of technology in the Motion Pictures 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.

Environmental challenges

– Immersion SA 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. Immersion SA can take advantage of this fund but it will also bring new competitors in the Motion Pictures industry.

Capital market disruption

– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Immersion SA.

High dependence on third party suppliers

– Immersion SA 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.

Shortening product life cycle

– it is one of the major threat that Immersion SA is facing in Motion Pictures sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

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Weighted SWOT Analysis of Immersion SA Template, Example

Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Immersion SA 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 Immersion SA 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 Immersion SA 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 Immersion SA 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 Immersion SA needs to make to build a sustainable competitive advantage.

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