New Sports (299) SWOT Analysis / TOWS Matrix / MBA Resources
Software & Programming
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for New Sports (Hong Kong)
Based on various researches at Oak Spring University , New Sports is operating in a macro-environment that has been destablized by – challanges to central banks by blockchain based private currencies, increasing household debt because of falling income levels, there is increasing trade war between United States & China, technology disruption, digital marketing is dominated by two big players Facebook and Google, supply chains are disrupted by pandemic , increasing government debt because of Covid-19 spendings,
cloud computing is disrupting traditional business models, geopolitical disruptions, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that New Sports can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the New Sports, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which New Sports 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 New Sports can be done for the following purposes –
1. Strategic planning of New Sports
2. Improving business portfolio management of New Sports
3. Assessing feasibility of the new initiative in Hong Kong
4. Making a Software & Programming sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of New Sports
Strengths of New Sports | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of New Sports are -
Ability to recruit top talent
– New Sports is one of the leading players in the Software & Programming industry in Hong Kong. It is in a position to attract the best talent available in Hong Kong. The firm has a robust talent identification program that helps in identifying the brightest.
High brand equity
– New Sports has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled New Sports to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Superior customer experience
– The customer experience strategy of New Sports in Software & Programming industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Diverse revenue streams
– New Sports is present in almost all the verticals within the Software & Programming industry. This has provided New Sports 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.
Strong track record of project management in the Software & Programming industry
– New Sports 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 New Sports 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.
Low bargaining power of suppliers
– Suppliers of New Sports in the Technology sector have low bargaining power. New Sports has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps New Sports to manage not only supply disruptions but also source products at highly competitive prices.
Innovation driven organization
– New Sports is one of the most innovative firm in Software & Programming sector.
Sustainable margins compare to other players in Software & Programming industry
– New Sports has clearly differentiated products in the market place. This has enabled New Sports to fetch slight price premium compare to the competitors in the Software & Programming industry. The sustainable margins have also helped New Sports to invest into research and development (R&D) and innovation.
Effective Research and Development (R&D)
– New Sports has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – New Sports staying ahead in the Software & Programming industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Learning organization
- New Sports 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 New Sports is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at New Sports emphasize – knowledge, initiative, and innovation.
Training and development
– New Sports has one of the best training and development program in Technology industry. The effectiveness of the training programs can be measured in – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Weaknesses of New Sports | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of New Sports are -
Skills based hiring in Software & Programming industry
– The stress on hiring functional specialists at New Sports 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.
Compensation and incentives
– The revenue per employee of New Sports is just above the Software & Programming 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.
Increasing silos among functional specialists
– The organizational structure of New Sports is dominated by functional specialists. It is not different from other players in the Software & Programming industry, but New Sports needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help New Sports to focus more on services in the Software & Programming industry rather than just following the product oriented approach.
Employees’ less understanding of New Sports strategy
– From the outside it seems that the employees of New Sports 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.
High bargaining power of channel partners in Software & Programming industry
– because of the regulatory requirements in Hong Kong, New Sports 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 Software & Programming industry.
Aligning sales with marketing
– From the outside it seems that New Sports needs to have more collaboration between its sales team and marketing team. Sales professionals in the Software & Programming industry have deep experience in developing customer relationships. Marketing department at New Sports can leverage the sales team experience to cultivate customer relationships as New Sports is planning to shift buying processes online.
High dependence on New Sports ‘s star products
– The top 2 products and services of New Sports still accounts for major business revenue. This dependence on star products in Software & Programming industry has resulted into insufficient focus on developing new products, even though New Sports has relatively successful track record of launching new products.
Interest costs
– Compare to the competition, New Sports 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.
Capital Spending Reduction
– Even during the low interest decade, New Sports 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 Software & Programming industry using digital technology.
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 New Sports supply chain. Even after few cautionary changes, New Sports is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left New Sports vulnerable to further global disruptions in South East Asia.
Workers concerns about automation
– As automation is fast increasing in the Software & Programming industry, New Sports 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.
New Sports Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of New Sports are -
Using analytics as competitive advantage
– New Sports has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Software & Programming sector. This continuous investment in analytics has enabled New Sports to build a competitive advantage using analytics. The analytics driven competitive advantage can help New Sports to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, New Sports can use these opportunities to build new business models that can help the communities that New Sports operates in. Secondly it can use opportunities from government spending in Software & Programming sector.
Better consumer reach
– The expansion of the 5G network will help New Sports to increase its market reach. New Sports 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for New Sports in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Software & Programming industry, and it will provide faster access to the consumers.
Developing new processes and practices
– New Sports can develop new processes and procedures in Software & Programming 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, New Sports 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.
Building a culture of innovation
– managers at New Sports 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 Software & Programming industry.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Software & Programming industry, but it has also influenced the consumer preferences. New Sports can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Manufacturing automation
– New Sports can use the latest technology developments to improve its manufacturing and designing process in Software & Programming 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.
Use of Bitcoin and other crypto currencies for transactions in Software & Programming industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for New Sports in the Software & Programming industry. Now New Sports can target international markets with far fewer capital restrictions requirements than the existing system.
Creating value in data economy
– The success of analytics program of New Sports has opened avenues for new revenue streams for the organization in Software & Programming industry. This can help New Sports to build a more holistic ecosystem for New Sports products in the Software & Programming industry by providing – data insight services, data privacy related products, data based consulting services, 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. New Sports can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Leveraging digital technologies
– New Sports 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 New Sports External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of New Sports are -
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 New Sports in the Software & Programming sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– New Sports has witnessed rapid integration of technology during Covid-19 in the Software & Programming industry. As one of the leading players in the industry, New Sports needs to keep up with the evolution of technology in the Software & Programming 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.
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. New Sports 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.
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 New Sports.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for New Sports in Software & Programming industry. The Software & Programming 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.
Stagnating economy with rate increase
– New Sports 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 Software & Programming industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, New Sports 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 New Sports prominent markets.
High dependence on third party suppliers
– New Sports 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, New Sports may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Software & Programming sector.
Increasing wage structure of New Sports
– 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 New Sports.
Environmental challenges
– New Sports 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. New Sports can take advantage of this fund but it will also bring new competitors in the Software & Programming industry.
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.
Easy access to finance
– Easy access to finance in Software & Programming industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. New Sports can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of New Sports Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at New Sports 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 New Sports 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 New Sports 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 New Sports 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 New Sports needs to make to build a sustainable competitive advantage.