SWOT Analysis / TOWS Matrix for Chalmers Ltd (Australia)
Based on various researches at Oak Spring University , Chalmers Ltd is operating in a macro-environment that has been destablized by – there is increasing trade war between United States & China, wage bills are increasing, customer relationship management is fast transforming because of increasing concerns over data privacy, talent flight as more people leaving formal jobs, digital marketing is dominated by two big players Facebook and Google, increasing inequality as vast percentage of new income is going to the top 1%, increasing commodity prices,
challanges to central banks by blockchain based private currencies, increasing government debt because of Covid-19 spendings, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Chalmers Ltd can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Chalmers Ltd, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Chalmers Ltd 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 Chalmers Ltd can be done for the following purposes –
1. Strategic planning of Chalmers Ltd
2. Improving business portfolio management of Chalmers Ltd
3. Assessing feasibility of the new initiative in Australia
4. Making a Trucking sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Chalmers Ltd
Strengths of Chalmers Ltd | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Chalmers Ltd are -
Ability to lead change in Trucking
– Chalmers Ltd is one of the leading players in the Trucking industry in Australia. Over the years it has not only transformed the business landscape in the Trucking industry in Australia but also across the existing markets. The ability to lead change has enabled Chalmers Ltd in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Digital Transformation in Trucking industry
- digital transformation varies from industry to industry. For Chalmers Ltd digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Chalmers Ltd 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.
Analytics focus
– Chalmers Ltd 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 Trucking industry. The technology infrastructure of Australia 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 Chalmers Ltd 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 Trucking industry
– Chalmers Ltd is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Sustainable margins compare to other players in Trucking industry
– Chalmers Ltd has clearly differentiated products in the market place. This has enabled Chalmers Ltd to fetch slight price premium compare to the competitors in the Trucking industry. The sustainable margins have also helped Chalmers Ltd to invest into research and development (R&D) and innovation.
High brand equity
– Chalmers Ltd has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Chalmers Ltd to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Operational resilience
– The operational resilience strategy of Chalmers Ltd comprises – understanding the underlying the factors in the Trucking 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.
Superior customer experience
– The customer experience strategy of Chalmers Ltd in Trucking industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Learning organization
- Chalmers Ltd 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 Chalmers Ltd is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Chalmers Ltd emphasize – knowledge, initiative, and innovation.
Effective Research and Development (R&D)
– Chalmers Ltd has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Chalmers Ltd staying ahead in the Trucking industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Successful track record of launching new products
– Chalmers Ltd has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Chalmers Ltd 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.
Weaknesses of Chalmers Ltd | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Chalmers Ltd are -
Slow to strategic competitive environment developments
– As Chalmers Ltd is one of the leading players in the Trucking industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Trucking industry in last five years.
No frontier risks strategy
– From the 10K / annual statement of Chalmers Ltd, it seems that company is thinking out the frontier risks that can impact Trucking 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.
High bargaining power of channel partners in Trucking industry
– because of the regulatory requirements in Australia, Chalmers Ltd 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 Trucking industry.
Ability to respond to the competition
– As the decision making is very deliberative at Chalmers Ltd, in the dynamic environment of Trucking industry it has struggled to respond to the nimble upstart competition. Chalmers Ltd has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High operating costs
– Compare to the competitors, Chalmers Ltd has high operating costs in the Trucking industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Chalmers Ltd lucrative customers.
High cash cycle compare to competitors
Chalmers Ltd has a high cash cycle compare to other players in the Trucking industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Chalmers Ltd is slow explore the new channels of communication. These new channels of communication can help Chalmers Ltd to provide better information regarding Trucking products and services. It can also build an online community to further reach out to potential customers.
Aligning sales with marketing
– From the outside it seems that Chalmers Ltd needs to have more collaboration between its sales team and marketing team. Sales professionals in the Trucking industry have deep experience in developing customer relationships. Marketing department at Chalmers Ltd can leverage the sales team experience to cultivate customer relationships as Chalmers Ltd is planning to shift buying processes online.
Employees’ less understanding of Chalmers Ltd strategy
– From the outside it seems that the employees of Chalmers Ltd 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.
Interest costs
– Compare to the competition, Chalmers Ltd 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.
Products dominated business model
– Even though Chalmers Ltd has some of the most successful models in the Trucking industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Chalmers Ltd should strive to include more intangible value offerings along with its core products and services.
Chalmers Ltd Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Chalmers Ltd are -
Buying journey improvements
– Chalmers Ltd can improve the customer journey of consumers in the Trucking 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Chalmers Ltd can use these opportunities to build new business models that can help the communities that Chalmers Ltd operates in. Secondly it can use opportunities from government spending in Trucking sector.
Better consumer reach
– The expansion of the 5G network will help Chalmers Ltd to increase its market reach. Chalmers Ltd 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Trucking industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Chalmers Ltd 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. Chalmers Ltd 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Chalmers Ltd 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 Chalmers Ltd to hire the very best people irrespective of their geographical location.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Chalmers Ltd in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Trucking industry, and it will provide faster access to the consumers.
Building a culture of innovation
– managers at Chalmers Ltd 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 Trucking industry.
Manufacturing automation
– Chalmers Ltd can use the latest technology developments to improve its manufacturing and designing process in Trucking 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Chalmers Ltd is facing challenges because of the dominance of functional experts in the organization. Chalmers Ltd can utilize new technology in the field of Trucking industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Use of Bitcoin and other crypto currencies for transactions in Trucking industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Chalmers Ltd in the Trucking industry. Now Chalmers Ltd can target international markets with far fewer capital restrictions requirements than the existing system.
Learning at scale
– Online learning technologies has now opened space for Chalmers Ltd 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Chalmers Ltd can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Creating value in data economy
– The success of analytics program of Chalmers Ltd has opened avenues for new revenue streams for the organization in Trucking industry. This can help Chalmers Ltd to build a more holistic ecosystem for Chalmers Ltd products in the Trucking industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Threats Chalmers Ltd External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Chalmers Ltd are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Chalmers Ltd 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 Chalmers Ltd prominent markets.
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 Chalmers Ltd business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Chalmers Ltd 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 Trucking industry.
Technology acceleration in Forth Industrial Revolution
– Chalmers Ltd has witnessed rapid integration of technology during Covid-19 in the Trucking industry. As one of the leading players in the industry, Chalmers Ltd needs to keep up with the evolution of technology in the Trucking 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, Chalmers Ltd may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Trucking sector.
Increasing wage structure of Chalmers Ltd
– 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 Chalmers Ltd.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Chalmers Ltd in Trucking industry. The Trucking 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.
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 Chalmers Ltd is facing in Trucking sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Consumer confidence and its impact on Chalmers Ltd 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 Trucking industry and other sectors.
Environmental challenges
– Chalmers Ltd 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. Chalmers Ltd can take advantage of this fund but it will also bring new competitors in the Trucking industry.
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. Chalmers Ltd 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 Chalmers Ltd.
Weighted SWOT Analysis of Chalmers Ltd Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Chalmers Ltd 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 Chalmers Ltd 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 Chalmers Ltd 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 Chalmers Ltd 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 Chalmers Ltd needs to make to build a sustainable competitive advantage.
