Constantin Medien AG (EV4G) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Constantin Medien AG (Germany)

Based on various researches at Oak Spring University , Constantin Medien AG is operating in a macro-environment that has been destablized by – increasing energy prices, increasing commodity prices, competitive advantages are harder to sustain because of technology dispersion, increasing inequality as vast percentage of new income is going to the top 1%, technology disruption, increasing transportation and logistics costs, wage bills are increasing, digital marketing is dominated by two big players Facebook and Google, increasing household debt because of falling income levels, etc

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Introduction to SWOT Analysis of Constantin Medien AG

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

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Strengths of Constantin Medien AG | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Constantin Medien AG are -

Operational resilience

– The operational resilience strategy of Constantin Medien AG comprises – understanding the underlying the factors in the Motion Pictures 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.

High switching costs

– The high switching costs that Constantin Medien AG 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.

Digital Transformation in Motion Pictures industry

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

Sustainable margins compare to other players in Motion Pictures industry

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

Effective Research and Development (R&D)

– Constantin Medien AG has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Constantin Medien AG 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

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

Diverse revenue streams

– Constantin Medien AG is present in almost all the verticals within the Motion Pictures industry. This has provided Constantin Medien AG 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.

Ability to lead change in Motion Pictures

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

Innovation driven organization

– Constantin Medien AG is one of the most innovative firm in Motion Pictures sector.

Ability to recruit top talent

– Constantin Medien AG is one of the leading players in the Motion Pictures 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.

Low bargaining power of suppliers

– Suppliers of Constantin Medien AG in the Services sector have low bargaining power. Constantin Medien AG has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Constantin Medien AG to manage not only supply disruptions but also source products at highly competitive prices.

Learning organization

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

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Weaknesses of Constantin Medien AG | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Constantin Medien AG are -

Slow to strategic competitive environment developments

– As Constantin Medien AG is one of the leading players in the Motion Pictures industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Motion Pictures industry in last five years.

Slow decision making process

– As mentioned earlier in the report, Constantin Medien AG has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Motion Pictures industry over the last five years. Constantin Medien AG 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.

Aligning sales with marketing

– From the outside it seems that Constantin Medien AG 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 Constantin Medien AG can leverage the sales team experience to cultivate customer relationships as Constantin Medien AG is planning to shift buying processes online.

Need for greater diversity

– Constantin Medien AG 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.

Skills based hiring in Motion Pictures industry

– The stress on hiring functional specialists at Constantin Medien AG 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.

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

Compensation and incentives

– The revenue per employee of Constantin Medien AG is just above the Motion Pictures 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.

High bargaining power of channel partners in Motion Pictures industry

– because of the regulatory requirements in Germany, Constantin Medien AG 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 operating costs

– Compare to the competitors, Constantin Medien AG 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 Constantin Medien AG lucrative customers.

High cash cycle compare to competitors

Constantin Medien AG 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.

Slow to harness new channels of communication

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

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Constantin Medien AG Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of Constantin Medien AG are -

Use of Bitcoin and other crypto currencies for transactions in Motion Pictures industry

– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Constantin Medien AG in the Motion Pictures industry. Now Constantin Medien AG can target international markets with far fewer capital restrictions requirements than the existing system.

Lowering marketing communication costs

– 5G expansion will open new opportunities for Constantin Medien AG 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.

Low interest rates

– Even though inflation is raising its head in most developed economies, Constantin Medien AG 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 Constantin Medien AG 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 Constantin Medien AG to hire the very best people irrespective of their geographical location.

Increase in government spending

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

Using analytics as competitive advantage

– Constantin Medien AG 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 Constantin Medien AG to build a competitive advantage using analytics. The analytics driven competitive advantage can help Constantin Medien AG to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, Constantin Medien AG 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 Constantin Medien AG 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 Constantin Medien AG to increase its market reach. Constantin Medien AG 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.

Building a culture of innovation

– managers at Constantin Medien AG 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 Motion Pictures industry.

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 Constantin Medien AG 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.

Developing new processes and practices

– Constantin Medien AG can develop new processes and procedures in Motion Pictures 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.

Learning at scale

– Online learning technologies has now opened space for Constantin Medien AG 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.

Reforming the budgeting process

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

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Threats Constantin Medien AG External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of Constantin Medien AG are -

Technology acceleration in Forth Industrial Revolution

– Constantin Medien AG has witnessed rapid integration of technology during Covid-19 in the Motion Pictures industry. As one of the leading players in the industry, Constantin Medien AG 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.

High dependence on third party suppliers

– Constantin Medien AG 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.

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.

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, Constantin Medien AG may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Motion Pictures sector.

Consumer confidence and its impact on Constantin Medien AG 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 Motion Pictures industry and other sectors.

Regulatory challenges

– Constantin Medien AG 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.

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. Constantin Medien AG needs to understand the core reasons impacting the Motion Pictures industry. This will help it in building a better workplace.

Stagnating economy with rate increase

– Constantin Medien AG 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.

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.

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 Constantin Medien AG business can come under increasing regulations regarding data privacy, data security, etc.

Increasing wage structure of Constantin Medien AG

– 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 Constantin Medien AG.

Environmental challenges

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

Easy access to finance

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

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Weighted SWOT Analysis of Constantin Medien AG Template, Example

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

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