SWOT Analysis / TOWS Matrix for Sanochemia Pharmazeutika (Germany)
Based on various researches at Oak Spring University , Sanochemia Pharmazeutika is operating in a macro-environment that has been destablized by – wage bills are increasing, increasing energy prices, increasing government debt because of Covid-19 spendings, geopolitical disruptions, central banks are concerned over increasing inflation, digital marketing is dominated by two big players Facebook and Google, competitive advantages are harder to sustain because of technology dispersion,
customer relationship management is fast transforming because of increasing concerns over data privacy, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Sanochemia Pharmazeutika
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Sanochemia Pharmazeutika can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Sanochemia Pharmazeutika, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Sanochemia Pharmazeutika 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 Sanochemia Pharmazeutika can be done for the following purposes –
1. Strategic planning of Sanochemia Pharmazeutika
2. Improving business portfolio management of Sanochemia Pharmazeutika
3. Assessing feasibility of the new initiative in Germany
4. Making a sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Sanochemia Pharmazeutika
Strengths of Sanochemia Pharmazeutika | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Sanochemia Pharmazeutika are -
Diverse revenue streams
– Sanochemia Pharmazeutika is present in almost all the verticals within the industry. This has provided Sanochemia Pharmazeutika 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
– Sanochemia Pharmazeutika is one of the most innovative firm in sector.
Highly skilled collaborators
– Sanochemia Pharmazeutika has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive industry. Secondly the value chain collaborators of Sanochemia Pharmazeutika have helped the firm to develop new products and bring them quickly to the marketplace.
Strong track record of project management in the industry
– Sanochemia Pharmazeutika is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High switching costs
– The high switching costs that Sanochemia Pharmazeutika 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.
Learning organization
- Sanochemia Pharmazeutika 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 Sanochemia Pharmazeutika is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Sanochemia Pharmazeutika emphasize – knowledge, initiative, and innovation.
High brand equity
– Sanochemia Pharmazeutika has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Sanochemia Pharmazeutika to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in industry
– Sanochemia Pharmazeutika has clearly differentiated products in the market place. This has enabled Sanochemia Pharmazeutika to fetch slight price premium compare to the competitors in the industry. The sustainable margins have also helped Sanochemia Pharmazeutika to invest into research and development (R&D) and innovation.
Superior customer experience
– The customer experience strategy of Sanochemia Pharmazeutika in industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Effective Research and Development (R&D)
– Sanochemia Pharmazeutika has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Sanochemia Pharmazeutika staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to lead change in
– Sanochemia Pharmazeutika is one of the leading players in the industry in Germany. Over the years it has not only transformed the business landscape in the industry in Germany but also across the existing markets. The ability to lead change has enabled Sanochemia Pharmazeutika in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Operational resilience
– The operational resilience strategy of Sanochemia Pharmazeutika comprises – understanding the underlying the factors in the 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.
Weaknesses of Sanochemia Pharmazeutika | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Sanochemia Pharmazeutika are -
Compensation and incentives
– The revenue per employee of Sanochemia Pharmazeutika is just above the 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 operating costs
– Compare to the competitors, Sanochemia Pharmazeutika has high operating costs in the industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Sanochemia Pharmazeutika lucrative customers.
Slow decision making process
– As mentioned earlier in the report, Sanochemia Pharmazeutika has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Sanochemia Pharmazeutika 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.
Workers concerns about automation
– As automation is fast increasing in the industry, Sanochemia Pharmazeutika needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Products dominated business model
– Even though Sanochemia Pharmazeutika has some of the most successful models in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Sanochemia Pharmazeutika should strive to include more intangible value offerings along with its core products and services.
Capital Spending Reduction
– Even during the low interest decade, Sanochemia Pharmazeutika 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 industry using digital technology.
Employees’ less understanding of Sanochemia Pharmazeutika strategy
– From the outside it seems that the employees of Sanochemia Pharmazeutika 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.
Increasing silos among functional specialists
– The organizational structure of Sanochemia Pharmazeutika is dominated by functional specialists. It is not different from other players in the industry, but Sanochemia Pharmazeutika needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Sanochemia Pharmazeutika to focus more on services in the industry rather than just following the product oriented approach.
Low market penetration in new markets
– Outside its home market of Germany, Sanochemia Pharmazeutika needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High dependence on Sanochemia Pharmazeutika ‘s star products
– The top 2 products and services of Sanochemia Pharmazeutika still accounts for major business revenue. This dependence on star products in industry has resulted into insufficient focus on developing new products, even though Sanochemia Pharmazeutika has relatively successful track record of launching new products.
Interest costs
– Compare to the competition, Sanochemia Pharmazeutika 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.
Sanochemia Pharmazeutika Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Sanochemia Pharmazeutika are -
Using analytics as competitive advantage
– Sanochemia Pharmazeutika has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in sector. This continuous investment in analytics has enabled Sanochemia Pharmazeutika to build a competitive advantage using analytics. The analytics driven competitive advantage can help Sanochemia Pharmazeutika to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Sanochemia Pharmazeutika 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 Sanochemia Pharmazeutika to hire the very best people irrespective of their geographical location.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Sanochemia Pharmazeutika 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. Sanochemia Pharmazeutika 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Sanochemia Pharmazeutika in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the industry, and it will provide faster access to the consumers.
Buying journey improvements
– Sanochemia Pharmazeutika can improve the customer journey of consumers in the 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in industry, but it has also influenced the consumer preferences. Sanochemia Pharmazeutika can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Low interest rates
– Even though inflation is raising its head in most developed economies, Sanochemia Pharmazeutika 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.
Manufacturing automation
– Sanochemia Pharmazeutika can use the latest technology developments to improve its manufacturing and designing process in 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 Sanochemia Pharmazeutika has opened avenues for new revenue streams for the organization in industry. This can help Sanochemia Pharmazeutika to build a more holistic ecosystem for Sanochemia Pharmazeutika products in the 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, Sanochemia Pharmazeutika 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 Sanochemia Pharmazeutika to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Loyalty marketing
– Sanochemia Pharmazeutika 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.
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. Sanochemia Pharmazeutika can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Leveraging digital technologies
– Sanochemia Pharmazeutika 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.
Threats Sanochemia Pharmazeutika External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Sanochemia Pharmazeutika are -
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.
Regulatory challenges
– Sanochemia Pharmazeutika 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 industry regulations.
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Sanochemia Pharmazeutika in industry. The 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to industry are lowering. It can presents Sanochemia Pharmazeutika with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Technology acceleration in Forth Industrial Revolution
– Sanochemia Pharmazeutika has witnessed rapid integration of technology during Covid-19 in the industry. As one of the leading players in the industry, Sanochemia Pharmazeutika needs to keep up with the evolution of technology in the 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 international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Sanochemia Pharmazeutika 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 Sanochemia Pharmazeutika prominent markets.
Shortening product life cycle
– it is one of the major threat that Sanochemia Pharmazeutika is facing in sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Sanochemia Pharmazeutika 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.
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 Sanochemia Pharmazeutika business can come under increasing regulations regarding data privacy, data security, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Sanochemia Pharmazeutika may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of sector.
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 Sanochemia Pharmazeutika in the sector and impact the bottomline of the organization.
Stagnating economy with rate increase
– Sanochemia Pharmazeutika 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 industry.
Weighted SWOT Analysis of Sanochemia Pharmazeutika Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Sanochemia Pharmazeutika 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 Sanochemia Pharmazeutika 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 Sanochemia Pharmazeutika 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 Sanochemia Pharmazeutika 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 Sanochemia Pharmazeutika needs to make to build a sustainable competitive advantage.