Based on various researches at Oak Spring University , Advanced Semiconductor Manufacturing is operating in a macro-environment that has been destablized by – central banks are concerned over increasing inflation, banking and financial system is disrupted by Bitcoin and other crypto currencies, supply chains are disrupted by pandemic , increasing household debt because of falling income levels, increasing commodity prices, technology disruption, increasing inequality as vast percentage of new income is going to the top 1%,
customer relationship management is fast transforming because of increasing concerns over data privacy, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of Advanced Semiconductor Manufacturing
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Advanced Semiconductor Manufacturing can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Advanced Semiconductor Manufacturing, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Advanced Semiconductor Manufacturing 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 Advanced Semiconductor Manufacturing can be done for the following purposes –
1. Strategic planning of Advanced Semiconductor Manufacturing
2. Improving business portfolio management of Advanced Semiconductor Manufacturing
3. Assessing feasibility of the new initiative in Hong Kong
4. Making a Semiconductors sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Advanced Semiconductor Manufacturing
Strengths of Advanced Semiconductor Manufacturing | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Advanced Semiconductor Manufacturing are -
Cross disciplinary teams
– Horizontal connected teams at the Advanced Semiconductor Manufacturing 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.
Strong track record of project management in the Semiconductors industry
– Advanced Semiconductor Manufacturing is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Digital Transformation in Semiconductors industry
- digital transformation varies from industry to industry. For Advanced Semiconductor Manufacturing digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Advanced Semiconductor Manufacturing 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.
Effective Research and Development (R&D)
– Advanced Semiconductor Manufacturing has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Advanced Semiconductor Manufacturing staying ahead in the Semiconductors industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to recruit top talent
– Advanced Semiconductor Manufacturing is one of the leading players in the Semiconductors 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.
Innovation driven organization
– Advanced Semiconductor Manufacturing is one of the most innovative firm in Semiconductors sector.
Sustainable margins compare to other players in Semiconductors industry
– Advanced Semiconductor Manufacturing has clearly differentiated products in the market place. This has enabled Advanced Semiconductor Manufacturing to fetch slight price premium compare to the competitors in the Semiconductors industry. The sustainable margins have also helped Advanced Semiconductor Manufacturing to invest into research and development (R&D) and innovation.
Successful track record of launching new products
– Advanced Semiconductor Manufacturing has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Advanced Semiconductor Manufacturing 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.
High brand equity
– Advanced Semiconductor Manufacturing has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Advanced Semiconductor Manufacturing to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Organizational Resilience of Advanced Semiconductor Manufacturing
– The covid-19 pandemic has put organizational resilience at the centre of everthing Advanced Semiconductor Manufacturing does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High switching costs
– The high switching costs that Advanced Semiconductor Manufacturing 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.
Superior customer experience
– The customer experience strategy of Advanced Semiconductor Manufacturing in Semiconductors industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses of Advanced Semiconductor Manufacturing | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Advanced Semiconductor Manufacturing are -
Need for greater diversity
– Advanced Semiconductor Manufacturing 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.
Employees’ less understanding of Advanced Semiconductor Manufacturing strategy
– From the outside it seems that the employees of Advanced Semiconductor Manufacturing 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.
No frontier risks strategy
– From the 10K / annual statement of Advanced Semiconductor Manufacturing, it seems that company is thinking out the frontier risks that can impact Semiconductors 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.
Interest costs
– Compare to the competition, Advanced Semiconductor Manufacturing 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.
Increasing silos among functional specialists
– The organizational structure of Advanced Semiconductor Manufacturing is dominated by functional specialists. It is not different from other players in the Semiconductors industry, but Advanced Semiconductor Manufacturing needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Advanced Semiconductor Manufacturing to focus more on services in the Semiconductors industry rather than just following the product oriented approach.
High dependence on Advanced Semiconductor Manufacturing ‘s star products
– The top 2 products and services of Advanced Semiconductor Manufacturing still accounts for major business revenue. This dependence on star products in Semiconductors industry has resulted into insufficient focus on developing new products, even though Advanced Semiconductor Manufacturing has relatively successful track record of launching new products.
High bargaining power of channel partners in Semiconductors industry
– because of the regulatory requirements in Hong Kong, Advanced Semiconductor Manufacturing 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 Semiconductors industry.
Lack of clear differentiation of Advanced Semiconductor Manufacturing products
– To increase the profitability and margins on the products, Advanced Semiconductor Manufacturing needs to provide more differentiated products than what it is currently offering in the marketplace.
High operating costs
– Compare to the competitors, Advanced Semiconductor Manufacturing has high operating costs in the Semiconductors industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Advanced Semiconductor Manufacturing lucrative customers.
Aligning sales with marketing
– From the outside it seems that Advanced Semiconductor Manufacturing needs to have more collaboration between its sales team and marketing team. Sales professionals in the Semiconductors industry have deep experience in developing customer relationships. Marketing department at Advanced Semiconductor Manufacturing can leverage the sales team experience to cultivate customer relationships as Advanced Semiconductor Manufacturing is planning to shift buying processes online.
Capital Spending Reduction
– Even during the low interest decade, Advanced Semiconductor Manufacturing 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 Semiconductors industry using digital technology.
Advanced Semiconductor Manufacturing Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Advanced Semiconductor Manufacturing are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Advanced Semiconductor Manufacturing in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Semiconductors industry, and it will provide faster access to the consumers.
Using analytics as competitive advantage
– Advanced Semiconductor Manufacturing has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Semiconductors sector. This continuous investment in analytics has enabled Advanced Semiconductor Manufacturing to build a competitive advantage using analytics. The analytics driven competitive advantage can help Advanced Semiconductor Manufacturing to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Leveraging digital technologies
– Advanced Semiconductor Manufacturing 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Semiconductors industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Advanced Semiconductor Manufacturing 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. Advanced Semiconductor Manufacturing 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Semiconductors industry, but it has also influenced the consumer preferences. Advanced Semiconductor Manufacturing can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Learning at scale
– Online learning technologies has now opened space for Advanced Semiconductor Manufacturing 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Advanced Semiconductor Manufacturing 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 Advanced Semiconductor Manufacturing to hire the very best people irrespective of their geographical location.
Buying journey improvements
– Advanced Semiconductor Manufacturing can improve the customer journey of consumers in the Semiconductors 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.
Use of Bitcoin and other crypto currencies for transactions in Semiconductors industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Advanced Semiconductor Manufacturing in the Semiconductors industry. Now Advanced Semiconductor Manufacturing can target international markets with far fewer capital restrictions requirements than the existing system.
Building a culture of innovation
– managers at Advanced Semiconductor Manufacturing 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 Semiconductors industry.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Advanced Semiconductor Manufacturing can use these opportunities to build new business models that can help the communities that Advanced Semiconductor Manufacturing operates in. Secondly it can use opportunities from government spending in Semiconductors sector.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Advanced Semiconductor Manufacturing can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Developing new processes and practices
– Advanced Semiconductor Manufacturing can develop new processes and procedures in Semiconductors 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.
Threats Advanced Semiconductor Manufacturing External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Advanced Semiconductor Manufacturing are -
Increasing wage structure of Advanced Semiconductor Manufacturing
– 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 Advanced Semiconductor Manufacturing.
High dependence on third party suppliers
– Advanced Semiconductor Manufacturing 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, Advanced Semiconductor Manufacturing 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 Advanced Semiconductor Manufacturing prominent markets.
Consumer confidence and its impact on Advanced Semiconductor Manufacturing 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 Semiconductors industry and other sectors.
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. Advanced Semiconductor Manufacturing 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.
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. Advanced Semiconductor Manufacturing needs to understand the core reasons impacting the Semiconductors industry. This will help it in building a better workplace.
Regulatory challenges
– Advanced Semiconductor Manufacturing 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 Semiconductors industry regulations.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Semiconductors industry are lowering. It can presents Advanced Semiconductor Manufacturing with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Semiconductors sector.
Technology acceleration in Forth Industrial Revolution
– Advanced Semiconductor Manufacturing has witnessed rapid integration of technology during Covid-19 in the Semiconductors industry. As one of the leading players in the industry, Advanced Semiconductor Manufacturing needs to keep up with the evolution of technology in the Semiconductors 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Advanced Semiconductor Manufacturing may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Semiconductors sector.
Stagnating economy with rate increase
– Advanced Semiconductor Manufacturing 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 Semiconductors 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Advanced Semiconductor Manufacturing in Semiconductors industry. The Semiconductors 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.
Weighted SWOT Analysis of Advanced Semiconductor Manufacturing Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Advanced Semiconductor Manufacturing 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 Advanced Semiconductor Manufacturing 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 Advanced Semiconductor Manufacturing 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 Advanced Semiconductor Manufacturing 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 Advanced Semiconductor Manufacturing needs to make to build a sustainable competitive advantage.