AMVIG (2300) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for AMVIG (Hong Kong)

Based on various researches at Oak Spring University , AMVIG is operating in a macro-environment that has been destablized by – banking and financial system is disrupted by Bitcoin and other crypto currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, there is increasing trade war between United States & China, there is backlash against globalization, supply chains are disrupted by pandemic , increasing household debt because of falling income levels, challanges to central banks by blockchain based private currencies, talent flight as more people leaving formal jobs, digital marketing is dominated by two big players Facebook and Google, etc

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Introduction to SWOT Analysis of AMVIG

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

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Strengths of AMVIG | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of AMVIG are -

Successful track record of launching new products

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

Strong track record of project management in the Printing Services industry

– AMVIG is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Highly skilled collaborators

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

Digital Transformation in Printing Services industry

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

High switching costs

– The high switching costs that AMVIG 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.

Cross disciplinary teams

– Horizontal connected teams at the AMVIG 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.

Analytics focus

– AMVIG is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the Printing Services industry. The technology infrastructure of Hong Kong is also helping it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.

Ability to recruit top talent

– AMVIG is one of the leading players in the Printing Services 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.

Low bargaining power of suppliers

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

Innovation driven organization

– AMVIG is one of the most innovative firm in Printing Services sector.

Effective Research and Development (R&D)

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

Sustainable margins compare to other players in Printing Services industry

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

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Weaknesses of AMVIG | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of AMVIG are -

Workers concerns about automation

– As automation is fast increasing in the Printing Services industry, AMVIG 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.

Low market penetration in new markets

– Outside its home market of Hong Kong, AMVIG needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.

Lack of clear differentiation of AMVIG products

– To increase the profitability and margins on the products, AMVIG needs to provide more differentiated products than what it is currently offering in the marketplace.

Capital Spending Reduction

– Even during the low interest decade, AMVIG 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 Printing Services industry using digital technology.

High dependence on AMVIG ‘s star products

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

High operating costs

– Compare to the competitors, AMVIG has high operating costs in the Printing Services industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract AMVIG lucrative customers.

Interest costs

– Compare to the competition, AMVIG 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.

Slow decision making process

– As mentioned earlier in the report, AMVIG has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Printing Services industry over the last five years. AMVIG 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.

Products dominated business model

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

Increasing silos among functional specialists

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

Employees’ less understanding of AMVIG strategy

– From the outside it seems that the employees of AMVIG 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.

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AMVIG Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of AMVIG are -

Use of Bitcoin and other crypto currencies for transactions in Printing Services industry

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

Leveraging digital technologies

– AMVIG 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.

Loyalty marketing

– AMVIG 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.

Redefining models of collaboration and team work

– As explained in the weaknesses section, AMVIG is facing challenges because of the dominance of functional experts in the organization. AMVIG can utilize new technology in the field of Printing Services industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.

Using analytics as competitive advantage

– AMVIG has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Printing Services sector. This continuous investment in analytics has enabled AMVIG to build a competitive advantage using analytics. The analytics driven competitive advantage can help AMVIG 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, AMVIG can use these opportunities to build new business models that can help the communities that AMVIG operates in. Secondly it can use opportunities from government spending in Printing Services sector.

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 AMVIG 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.

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. AMVIG can explore opportunities that can attract volunteers and are consistent with its mission and vision.

Changes in consumer behavior post Covid-19

– consumer behavior has changed in the Printing Services industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. AMVIG 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. AMVIG 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.

Reforming the budgeting process

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

Harnessing reconfiguration of the global supply chains

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

Finding new ways to collaborate

– Covid-19 has not only transformed business models of companies in Printing Services industry, but it has also influenced the consumer preferences. AMVIG can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

Remote work and new talent hiring opportunities

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

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Threats AMVIG External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of AMVIG are -

Stagnating economy with rate increase

– AMVIG 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 Printing Services industry.

High dependence on third party suppliers

– AMVIG 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 acceleration in Forth Industrial Revolution

– AMVIG has witnessed rapid integration of technology during Covid-19 in the Printing Services industry. As one of the leading players in the industry, AMVIG needs to keep up with the evolution of technology in the Printing Services 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.

Environmental challenges

– AMVIG 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. AMVIG can take advantage of this fund but it will also bring new competitors in the Printing Services industry.

Easy access to finance

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

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. AMVIG 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.

Regulatory challenges

– AMVIG 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 Printing Services industry regulations.

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 AMVIG in the Printing Services sector and impact the bottomline of the organization.

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 AMVIG business can come under increasing regulations regarding data privacy, data security, etc.

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.

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 AMVIG.

Increasing wage structure of AMVIG

– 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 AMVIG.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, AMVIG 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 AMVIG prominent markets.

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Weighted SWOT Analysis of AMVIG Template, Example

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

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