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Kuehne & Nagel (KNIN) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Kuehne & Nagel (Germany)


Based on various researches at Oak Spring University , Kuehne & Nagel is operating in a macro-environment that has been destablized by – wage bills are increasing, technology disruption, increasing commodity prices, increasing energy prices, talent flight as more people leaving formal jobs, competitive advantages are harder to sustain because of technology dispersion, geopolitical disruptions, there is increasing trade war between United States & China, increasing transportation and logistics costs, etc



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Introduction to SWOT Analysis of Kuehne & Nagel


SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Kuehne & Nagel can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Kuehne & Nagel, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Kuehne & Nagel 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 Kuehne & Nagel can be done for the following purposes –
1. Strategic planning of Kuehne & Nagel
2. Improving business portfolio management of Kuehne & Nagel
3. Assessing feasibility of the new initiative in Germany
4. Making a Water Transportation sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Kuehne & Nagel




Strengths of Kuehne & Nagel | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Kuehne & Nagel are -

Diverse revenue streams

– Kuehne & Nagel is present in almost all the verticals within the Water Transportation industry. This has provided Kuehne & Nagel 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.

Effective Research and Development (R&D)

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

Learning organization

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

Innovation driven organization

– Kuehne & Nagel is one of the most innovative firm in Water Transportation sector.

Highly skilled collaborators

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

Cross disciplinary teams

– Horizontal connected teams at the Kuehne & Nagel 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 Water Transportation industry

– Kuehne & Nagel has clearly differentiated products in the market place. This has enabled Kuehne & Nagel to fetch slight price premium compare to the competitors in the Water Transportation industry. The sustainable margins have also helped Kuehne & Nagel to invest into research and development (R&D) and innovation.

High switching costs

– The high switching costs that Kuehne & Nagel 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

– Kuehne & Nagel has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Kuehne & Nagel 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.

Ability to lead change in Water Transportation

– Kuehne & Nagel is one of the leading players in the Water Transportation industry in Germany. Over the years it has not only transformed the business landscape in the Water Transportation industry in Germany but also across the existing markets. The ability to lead change has enabled Kuehne & Nagel in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

Ability to recruit top talent

– Kuehne & Nagel is one of the leading players in the Water Transportation industry in Germany. It is in a position to attract the best talent available in Germany. The firm has a robust talent identification program that helps in identifying the brightest.

High brand equity

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






Weaknesses of Kuehne & Nagel | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Kuehne & Nagel are -

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 Kuehne & Nagel supply chain. Even after few cautionary changes, Kuehne & Nagel is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Kuehne & Nagel vulnerable to further global disruptions in South East Asia.

Slow to strategic competitive environment developments

– As Kuehne & Nagel is one of the leading players in the Water Transportation industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Water Transportation industry in last five years.

Skills based hiring in Water Transportation industry

– The stress on hiring functional specialists at Kuehne & Nagel 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.

Products dominated business model

– Even though Kuehne & Nagel has some of the most successful models in the Water Transportation industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Kuehne & Nagel should strive to include more intangible value offerings along with its core products and services.

High bargaining power of channel partners in Water Transportation industry

– because of the regulatory requirements in Germany, Kuehne & Nagel 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 Water Transportation industry.

Ability to respond to the competition

– As the decision making is very deliberative at Kuehne & Nagel, in the dynamic environment of Water Transportation industry it has struggled to respond to the nimble upstart competition. Kuehne & Nagel 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, Kuehne & Nagel 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.

No frontier risks strategy

– From the 10K / annual statement of Kuehne & Nagel, it seems that company is thinking out the frontier risks that can impact Water Transportation 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.

Capital Spending Reduction

– Even during the low interest decade, Kuehne & Nagel 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 Water Transportation industry using digital technology.

High dependence on Kuehne & Nagel ‘s star products

– The top 2 products and services of Kuehne & Nagel still accounts for major business revenue. This dependence on star products in Water Transportation industry has resulted into insufficient focus on developing new products, even though Kuehne & Nagel has relatively successful track record of launching new products.

Increasing silos among functional specialists

– The organizational structure of Kuehne & Nagel is dominated by functional specialists. It is not different from other players in the Water Transportation industry, but Kuehne & Nagel needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Kuehne & Nagel to focus more on services in the Water Transportation industry rather than just following the product oriented approach.




Kuehne & Nagel Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis


The opportunities of Kuehne & Nagel are -

Buying journey improvements

– Kuehne & Nagel can improve the customer journey of consumers in the Water Transportation industry by using analytics and artificial intelligence. It can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.

Learning at scale

– Online learning technologies has now opened space for Kuehne & Nagel 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.

Low interest rates

– Even though inflation is raising its head in most developed economies, Kuehne & Nagel 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.

Remote work and new talent hiring opportunities

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

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, Kuehne & Nagel 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 Kuehne & Nagel to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

Leveraging digital technologies

– Kuehne & Nagel 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.

Building a culture of innovation

– managers at Kuehne & Nagel 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 Water Transportation industry.

Using analytics as competitive advantage

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

Creating value in data economy

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

Developing new processes and practices

– Kuehne & Nagel can develop new processes and procedures in Water Transportation 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.

Better consumer reach

– The expansion of the 5G network will help Kuehne & Nagel to increase its market reach. Kuehne & Nagel 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. Kuehne & Nagel can explore opportunities that can attract volunteers and are consistent with its mission and vision.

Increase in government spending

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




Threats Kuehne & Nagel External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis


The threats of Kuehne & Nagel are -

Easy access to finance

– Easy access to finance in Water Transportation industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Kuehne & Nagel can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.

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 Kuehne & Nagel.

Regulatory challenges

– Kuehne & Nagel 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 Water Transportation industry regulations.

Increasing wage structure of Kuehne & Nagel

– 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 Kuehne & Nagel.

Environmental challenges

– Kuehne & Nagel 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. Kuehne & Nagel can take advantage of this fund but it will also bring new competitors in the Water Transportation industry.

High dependence on third party suppliers

– Kuehne & Nagel 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.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, Kuehne & Nagel 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 Kuehne & Nagel prominent markets.

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. Kuehne & Nagel needs to understand the core reasons impacting the Water Transportation industry. This will help it in building a better workplace.

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. Kuehne & Nagel 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.

Stagnating economy with rate increase

– Kuehne & Nagel 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 Water Transportation industry.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Kuehne & Nagel in Water Transportation industry. The Water Transportation 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.

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 Kuehne & Nagel business can come under increasing regulations regarding data privacy, data security, etc.

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.




Weighted SWOT Analysis of Kuehne & Nagel Template, Example


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



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