Allan Intl (684) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Allan Intl (Hong Kong)

Based on various researches at Oak Spring University , Allan Intl is operating in a macro-environment that has been destablized by – geopolitical disruptions, wage bills are increasing, technology disruption, there is increasing trade war between United States & China, central banks are concerned over increasing inflation, increasing commodity prices, talent flight as more people leaving formal jobs, increasing government debt because of Covid-19 spendings, increasing energy prices, etc

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Introduction to SWOT Analysis of Allan Intl

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

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

The strengths of Allan Intl are -

Highly skilled collaborators

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

Effective Research and Development (R&D)

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

High brand equity

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

Training and development

– Allan Intl has one of the best training and development program in Consumer Cyclical 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.

Organizational Resilience of Allan Intl

– The covid-19 pandemic has put organizational resilience at the centre of everthing Allan Intl does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.

Strong track record of project management in the Appliance & Tool industry

– Allan Intl 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 Allan Intl 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.

Ability to recruit top talent

– Allan Intl is one of the leading players in the Appliance & Tool 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.

Diverse revenue streams

– Allan Intl is present in almost all the verticals within the Appliance & Tool industry. This has provided Allan Intl 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.

Learning organization

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

Analytics focus

– Allan Intl 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 Appliance & Tool 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.

Cross disciplinary teams

– Horizontal connected teams at the Allan Intl 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.

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

The weaknesses of Allan Intl are -

High operating costs

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

Aligning sales with marketing

– From the outside it seems that Allan Intl needs to have more collaboration between its sales team and marketing team. Sales professionals in the Appliance & Tool industry have deep experience in developing customer relationships. Marketing department at Allan Intl can leverage the sales team experience to cultivate customer relationships as Allan Intl is planning to shift buying processes online.

Workers concerns about automation

– As automation is fast increasing in the Appliance & Tool industry, Allan Intl 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.

High cash cycle compare to competitors

Allan Intl has a high cash cycle compare to other players in the Appliance & Tool industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.

Low market penetration in new markets

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

Slow decision making process

– As mentioned earlier in the report, Allan Intl has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Appliance & Tool industry over the last five years. Allan Intl 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.

Lack of clear differentiation of Allan Intl products

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

Employees’ less understanding of Allan Intl strategy

– From the outside it seems that the employees of Allan Intl 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.

Ability to respond to the competition

– As the decision making is very deliberative at Allan Intl, in the dynamic environment of Appliance & Tool industry it has struggled to respond to the nimble upstart competition. Allan Intl has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

High bargaining power of channel partners in Appliance & Tool industry

– because of the regulatory requirements in Hong Kong, Allan Intl 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 Appliance & Tool industry.

Interest costs

– Compare to the competition, Allan Intl 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.

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

The opportunities of Allan Intl are -

Buying journey improvements

– Allan Intl can improve the customer journey of consumers in the Appliance & Tool 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 Appliance & Tool industry, but it has also influenced the consumer preferences. Allan Intl can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

Better consumer reach

– The expansion of the 5G network will help Allan Intl to increase its market reach. Allan Intl 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 Allan Intl 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 Appliance & Tool industry.

Low interest rates

– Even though inflation is raising its head in most developed economies, Allan Intl 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.

Creating value in data economy

– The success of analytics program of Allan Intl has opened avenues for new revenue streams for the organization in Appliance & Tool industry. This can help Allan Intl to build a more holistic ecosystem for Allan Intl products in the Appliance & Tool industry by providing – data insight services, data privacy related products, data based consulting services, etc.

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects Allan Intl 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, Allan Intl 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 Allan Intl to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

Leveraging digital technologies

– Allan Intl 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.

Developing new processes and practices

– Allan Intl can develop new processes and procedures in Appliance & Tool 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.

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

Using analytics as competitive advantage

– Allan Intl has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Appliance & Tool sector. This continuous investment in analytics has enabled Allan Intl to build a competitive advantage using analytics. The analytics driven competitive advantage can help Allan Intl 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 Allan Intl 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 Allan Intl to hire the very best people irrespective of their geographical location.

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

The threats of Allan Intl are -

Easy access to finance

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

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. Allan Intl needs to understand the core reasons impacting the Appliance & Tool industry. This will help it in building a better workplace.

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.

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 Allan Intl in the Appliance & Tool sector and impact the bottomline of the organization.

High dependence on third party suppliers

– Allan Intl 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.

Regulatory challenges

– Allan Intl 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 Appliance & Tool industry regulations.

Increasing wage structure of Allan Intl

– 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 Allan Intl.

Environmental challenges

– Allan Intl 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. Allan Intl can take advantage of this fund but it will also bring new competitors in the Appliance & Tool industry.

Technology acceleration in Forth Industrial Revolution

– Allan Intl has witnessed rapid integration of technology during Covid-19 in the Appliance & Tool industry. As one of the leading players in the industry, Allan Intl needs to keep up with the evolution of technology in the Appliance & Tool 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.

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.

Shortening product life cycle

– it is one of the major threat that Allan Intl is facing in Appliance & Tool sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

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 Allan Intl business can come under increasing regulations regarding data privacy, data security, 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. Allan Intl 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.

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Weighted SWOT Analysis of Allan Intl Template, Example

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

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