Business s Final

8/3/2019 Business s Final

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SWOT ANALYSIS

&

BENCHMARKINGBY:

ASHISH MURCHITE

MAMTA KUMAWATNIDHI JOSHI

PRIYANKA JAIN

SMRUTI PRIYADARSINI


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SWOT ANALYSIS

S W O TS W O T representsthe first letter in

yy SS trengths

yy WWeaknesses

yy OO pportunities

yy TThreats


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SWOTA widely used framework fororganizingand using data

and informationgained fromsituationanalysis

Encompasses both internal and external environments

Oneofthemosteffectivetools intheanalysisof

environmental dataand information

It isan instrument withinstrategicplanning


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SWOT

Factorsaffectinganorganizationcanusually beclassified as:

Internal factorsy Strengths (S)

y Weaknesses (W)

External factors

y Opportunities (O)

y Threats (T)

Strengths

Opportunities

Weaknesses

Threats


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SWOT: INTERNAL FACTORS

Strengths

y Positivetangibleand intangibleattributes, internal

toanorganization. They are withinthe

organizationscontrol

Weaknesses

y Factorsthatare withinanorganizationscontrol that

detract from itsability toattainthecoregoal. In

whichareasmighttheorganization improve?


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SWOT: EXTERNAL FACTORS Opportunities

y External attractive factorsthatrepresentthereason foranorganizationtoexistand develop. Whatopportunitiesexistintheenvironment which will propel theorganization?

y Identify them by their time frames

Threatsy External factors, beyond anorganizationscontrol, which

could placetheorganizationsmissionoroperationatrisk.Theorganizationmay benefit by havingcontingency planstoaddressthemshould they occur

y Classify them by their seriousnessand probability ofoccurrence


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FOR THE EXTERNAL FACTORS

Must

plan

for

Minimum

resources ifany

Maintainflexibility in

plan

Forget

it

HighLow

High

Low

Probability of

occurrence

Seriousness of Impact


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IDENTIFYING RESOURCE STRENGTHS

AND COMPETITIVE CAPABILITIES

Astrength issomethinga firm does well oranattributethatenhances itscompetitivenessy Valuableskills,competencies,orcapabilities

y Valuablephysical assets

y Valuablehumanassets

y Valuableorganizational assets

y Valuable intangibleassets

y Importantcompetitivecapabilities

y Anattributeplacingacompany inapositionofmarketadvantage

y Alliancesorcooperativeventures withpartners

Resource strengths and competitive

capabilities are competitive assets!


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COMPETENCIES VS. CORE COMPETENCIES VS.

DISTINCTIVE COMPETENCIES

Acompetence istheproduct of

organizational learning and experience and

representsrealproficiency inperformingan

internal activity

Acore competence isa well-performed

internal activity central (notperipheral or

incidental) toacompanyscompetitiveness

and profitability

Adistinctive competence isacompetitively

valuable activity acompanyperforms better

than its rivals


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COMPANY COMPETENCIES AND

CAPABILITIES

Stem fromskills, expertise, and

experience usually representingan

y Accumulationoflearningovertimeand

y

Gradual buildupofrealproficiency inperforming an activity

Involvedeliberate efforts to developtheability

to dosomething,oftenentailing

y Selectingpeople withrequisiteknowledgeand skills

y Upgradingorexpanding individual abilitiesy Molding workproductsof individuals intoa

cooperativeefforttocreateorganizational ability

y Aconsciousefforttocreate intellectual capital


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CORE COMPETENCIES

A VALUABLE COMPANY RESOURCE

Acompetence becomesacore competence

whenthe well-performed activity iscentral toa

companyscompetitivenessand profitability

Often,a core competence isknowledge-based,residing inpeople,

not inassetsona balancesheet

Acore competence istypically theresultof

cross-department collaboration

Acore competence givesacompany a

potentially valuablecompetitive capability

and representsa definite competitive asset


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EXAMPLES: CORE COMPETENCIES

Expertise in integratingmultipletechnologies

tocreate familiesofnew products

Know-how increatingoperatingsystems

forcostefficientsupply chainmanagement

Speedingnew/next-generationproductsto

market

Betterafter-saleservicecapability Skills inmanufacturingahighquality product

Capability to fill customerordersaccurately and

swiftly


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DISTINCTIVE COMPETENCE

A COMPETITIVELY SUPERIOR RESOURCE

Adistinctive competence isacompetitively

valuableactivity thatacompanyperforms

better than its competitors

Adistinctive competence isacompetitivelypotent resource source because it

y Givesacompany acompetitively valuable

capability unmatched by rivals

y Can underpin and add real punch

toacompanysstrategy

y Isabasis forsustainable competitive advantage


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EXAMPLES: DISTINCTIVE COMPETENCIES

Toyota

Low-cost,high-quality

manufacturingofmotor

vehicles

Starbucks

Innovativecoffee drinks

and storeambience


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DETERMINING THE COMPETITIVE

POWER OF A COMPANY RESOURCE

Toqualify ascompetitively valuableorto bethe

basis forsustainable competitive advantage,

aresourcemustpass 4 tests:

1. Istheresourcehard to copy?

2. Istheresourcedurable does ithavestaying

power?

3. Istheresourcereally competitively superior?

4. Cantheresource betrumped by

the differentcapabilitiesofrivals?


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IDENTIFYING RESOURCE WEAKNESSES

AND COMPETITIVE DEFICIENCIES

Aweakness issomethinga firm lacks, does

poorly,oraconditionplacing itata disadvantage

Resource weaknesses relateto

y Inferiororunprovenskills,

expertise,or intellectual capital

y Lackof importantphysical,

organizational,or intangibleassets

y Missingcapabilities inkey areas

Resource weaknesses and deficienciesare competitive liabilities!


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IDENTIFYING A COMPANYS

MARKET OPPORTUNITIES

Opportunitiesmost relevant toa

company arethoseoffering

y Good match with its financial andorganizational resourcecapabilities

y Best prospects forprofitable

long-term growth

y Potential for competitive advantage


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IDENTIFYING EXTERNAL THREATS

Emergenceofcheaper/bettertechnologies

Introductionof betterproducts by rivals

Entry of lower-cost foreigncompetitors

Onerousregulations

Rise in interestrates

Potential ofahostiletakeover

Unfavorable demographicshifts

Adverseshifts in foreignexchangerates

Political upheaval inacountry


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ROLE OF SWOT ANALYSIS IN

CRAFTING A BETTER STRATEGY

S W O TS W O T analysisinvolves more than justdeveloping the 4 lists ofstrengths, weaknesses,opportunities,and threats

Themost importantpartofS W O TS W O T analysis is

y Using the 4 lists to draw conclusionsabout a companys overall situation

y Acting on the conclusions to

Bettermatchacompanysstrategy to itsresourcestrengthsand marketopportunities

Correctthe important weaknesses

Defend againstexternal threats


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THE THREE STEPS OF SWOT ANALYSIS


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CREATE A PLAN OFACTION

Whatstepscan youtaketo:

y Capitalizeon yourstrengths

y Overcomeorminimize your weaknesses

y

Takeadvantageofsomenew opportunitiesy Respond tothethreats

Setgoalsand objectives, like withany otherplan


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MAJOR BENEFITS OF SWOT

ANALYSES

Simplicity

Flexibility

Integrationand synthesis

Collaboration

Lowercosts


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FOR A PRODUCTIVE SWOT

ANALYSIS

Stay focused. Bespecificand avoid grey areas.

Keep yourswotshortand simple. Avoid

complexity and overanalysis

Collaborate withother functional areas Examine issues fromthecustomers/

stakeholdersperspective

Look forcauses,notcharacteristics

Separate internal issues fromexternal issues


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WHAT IS BENCHMARKING

Benchmarking isan improvementprocessthat is

used to identify bestpractice withinapeergroup

and facilitate its incorporation into your

organization

Bestpracticereferstotechniques,methodsor

processesthataremoreeffectiveat deliveringa

desired outcome.

Incorporating bestpractice into yourorganization

can lead togreaterefficiency and effectivenessand ahappiercustomer.


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OBJECTIVES OF BENCHMARKING

Identify bestand mostefficientmeansof

performingvariousvaluechainactivities

Learn what isthe best way toperforma

particularactivity fromthosecompanies whohave demonstrated thatthey are best-in-

industryor best-in-worldatperformingthe

activity

Learn whatother firms dotoperformanactivity at lowercost

Figure out what actions to take to improvea

companysowncostcompetitiveness


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TYPES OF BENCHMARKING

Thereare fourtypesof benchmarking:

Strategic Benchmarking

Functional BenchmarkingBest Practices Benchmarking

Product Benchmarking


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ETHICAL PRINCIPLES IN

BENCHMARKING

Avoid actions implyinganinterest in

y Restraintoftradey Marketand/orcustomer

allocationschemesy Price fixingy

Bribery Refrain fromacquiringtrade

secrets by any meansviewed asimproper

Be willingtoprovidesametypeof informationtoabenchmarkingpartner

Communicateearly toclarifyexpectationsand avoidmisunderstandings

Behonestand complete

Treat benchmarkinginterchangeasconfidential

Use informationobtained onlyforstated purposes

Respectcorporatecultureofpartnercompanies

Use benchmarkingcontactsdesignated by partnercompany

Be fully prepared foreachexchange

Providepartners withagendaand questionnairepriortoexchange

Follow through withcommitmentstopartner inatimely manner

Understand how partner wantsinformationprovided used


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THE BENCHMARKING PROCESS

Benchmarkinghasa defined process1. Identify theprocessthat will be benchmarked

consider whatmetrics will bemeasured

2. Measureresults inownorganization

3. Identify a benchmarkingpartner (look forone withfavourableresultsortothemetric beingmeasured orknown bestpractice)

4. Measuretheprocess

5. Analyzetheconditionsthat determinethe favourableresults

6. Determineanactionplantotake yourorganizationtothe favourableresults

7. Review Benchmarkingresultsand conductregularreviews with yourpeer(s).


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BENEFITS OF BENCHMARKING

Benchmarkinghelps identify thegaps between

theorganizationthat isundertakingthe

benchmarkingassessmentand bestpractice.

Undertaking benchmarkingcan lead toimprovements being incorporated intoprocesses

and systems deliveringgains inefficiency and

effectiveness

Benchmarkingcanhelpalign improvement

activity withstrategicgoalsand objectives

providesrealisticand achievabletargets


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PROBLEMS WITH BENCHMARKING

Problems with benchmarkingoccur where

y Data isnotobtained fortheprocess beingmeasured and analysis becomessubjective

y Nopeergroup/bestpractice identified (including data

available)y Thegap betweencurrentstateand bestpractice is

captured butnothing is doneabout it

y Assumed bestpractice isn't bestpractice

y Benchmarkinghappensasaoneoffeventand not

reviewed periodicallyy benchmarksgiveno indicationof futurecapabilities


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T HANK YOU

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