Jabil Circuit SWOT Analysis / Matrix

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SWOT analysis is a vital strategic planning tool that can be used by Jabil Circuit managers to do a situational analysis of the company . It is an important technique to understand the present Strengths (S), Weakness (W), Opportunities (O) & Threats (T) Jabil Circuit is facing in its current business environment.

The Jabil Circuit is one of the leading firms in its industry. Jabil Circuit maintains its prominent position in market by critically analyzing and reviewing the SWOT analysis.  SWOT analysis a highly interactive process and requires effective coordination among various departments within the firm such as – marketing, finance, operations, management information systems and strategic planning.

The SWOT Analysis framework helps an organization to identify the internal strategic factors such as -strengths and weaknesses, & external strategic factors such as - opportunities and threats. It leads to a 2X2 matrix – also called SWOT Matrix.

The Strengths-Weaknesses-Opportunities-Threats (SWOT) Analysis / Matrix helps the managers of the Jabil Circuit to develop four types of strategies:

  • SO (strengths-opportunities) Strategies
  • WO (weaknesses-opportunities) Strategies
  • ST (strengths-threats) Strategies
  •  WT (weaknesses-threats) Strategies
Jabil Circuit swot analysis / matrix

SWOT Matrix Strategies Objective

The central purpose of SWOT matrix is to identify the strategies that an organization can utilize to exploit external opportunities, counter threats, and build on & protect Jabil Circuit strengths, and eradicate its weaknesses.

Step by Step Guide to Jabil Circuit SWOT Analysis

Strengths of Jabil Circuit – Internal Strategic Factors

As one of the leading firms in its industry, Jabil Circuit has numerous strengths that help it to thrive in the market place. These strengths not only help it to protect the market share in existing markets but also help in penetrating new markets. Based on Fern Fort University extensive research – some of the strengths of Jabil Circuit are –

  • Highly successful at Go To Market strategies for its products.
  • Reliable suppliers – It has a strong base of reliable supplier of raw material thus enabling the company to overcome any supply chain bottlenecks.
  • Strong Brand Portfolio – Over the years Jabil Circuit has invested in building a strong brand portfolio. The SWOT analysis of Jabil Circuit just underlines this fact. This brand portfolio can be extremely useful if the organization wants to expand into new product categories.
  • Strong dealer community – It has built a culture among distributor & dealers where the dealers not only promote company’s products but also invest in training the sales team to explain to the customer how he/she can extract the maximum benefits out of the products.
  • Highly skilled workforce through successful training and learning programs. Jabil Circuit is investing huge resources in training and development of its employees resulting in a workforce that is not only highly skilled but also motivated to achieve more.
  • Strong distribution network – Over the years Jabil Circuit has built a reliable distribution network that can reach majority of its potential market.
  • Automation of activities brought consistency of quality to Jabil Circuit products and has enabled the company to scale up and scale down based on the demand conditions in the market.
  • Strong Free Cash Flow – Jabil Circuit has strong free cash flows that provide resources in the hand of the company to expand into new projects.

Weakness of Jabil Circuit – Internal Strategic Factors

Weakness are the areas where Jabil Circuit can improve upon. Strategy is about making choices and weakness are the areas where a firm can improve using SWOT analysis and build on its competitive advantage and strategic positioning.

  • Financial planning is not done properly and efficiently. The current asset ratio and liquid asset ratios suggest that the company can use the cash more efficiently than what it is doing at present.
  • Days inventory is high compare to the competitors – making the company raise more capital to invest in the channel. This can impact the long term growth of Jabil Circuit
  • High attrition rate in work force – compare to other organizations in the industry Jabil Circuit has a higher attrition rate and have to spend a lot more compare to its competitors on training and development of its employees.
  • The marketing of the products left a lot to be desired. Even though the product is a success in terms of sale but its positioning and unique selling proposition is not clearly defined which can lead to the attacks in this segment from the competitors.
  • There are gaps in the product range sold by the company. This lack of choice can give a new competitor a foothold in the market.
  • Organization structure is only compatible with present business model thus limiting expansion in adjacent product segments.
  • Not very good at product demand forecasting leading to higher rate of missed opportunities compare to its competitors. One of the reason why the days inventory is high compare to its competitors is that Jabil Circuit is not very good at demand forecasting thus end up keeping higher inventory both in-house and in channel.

Opportunities for Jabil Circuit – External Strategic Factors

  • Government green drive also opens an opportunity for procurement of Jabil Circuit products by the state as well as federal government contractors.
  • Stable free cash flow provides opportunities to invest in adjacent product segments. With more cash in bank the company can invest in new technologies as well as in new products segments. This should open a window of opportunity for Jabil Circuit in other product categories.
  • Economic uptick and increase in customer spending, after years of recession and slow growth rate in the industry, is an opportunity for Jabil Circuit to capture new customers and increase its market share.
  • The new technology provides an opportunity to Jabil Circuit to practices differentiated pricing strategy in the new market. It will enable the firm to maintain its loyal customers with great service and lure new customers through other value oriented propositions.
  • The new taxation policy can significantly impact the way of doing business and can open new opportunity for established players such as Jabil Circuit to increase its profitability.
  • Decreasing cost of transportation because of lower shipping prices can also bring down the cost of Jabil Circuit’s products thus providing an opportunity to the company - either to boost its profitability or pass on the benefits to the customers to gain market share.
  • Lower inflation rate – The low inflation rate bring more stability in the market, enable credit at lower interest rate to the customers of Jabil Circuit.
  • The market development will lead to dilution of competitor’s advantage and enable Jabil Circuit to increase its competitiveness compare to the other competitors.

Threats Jabil Circuit Facing - External Strategic Factors

  • Increasing trend toward isolationism in the American economy can lead to similar reaction from other government thus negatively impacting the international sales.
  • As the company is operating in numerous countries it is exposed to currency fluctuations especially given the volatile political climate in number of markets across the world.
  • Rising pay level especially movements such as $15 an hour and increasing prices in the China can lead to serious pressure on profitability of Jabil Circuit
  • Changing consumer buying behavior from online channel could be a threat to the existing physical infrastructure driven supply chain model.
  • Shortage of skilled workforce in certain global market represents a threat to steady growth of profits for Jabil Circuit   in those markets.
  • New technologies developed by the competitor or market disruptor could be a serious threat to the industry in medium to long term future.
  • Liability laws in different countries are different and Jabil Circuit may be exposed to various liability claims given change in policies in those markets.
  • Imitation of the counterfeit and low quality product is also a threat to Jabil Circuit’s product especially in the emerging markets and low income markets.

Limitations of SWOT Analysis for Jabil Circuit

Although the SWOT analysis is widely used as a strategic planning tool, the analysis does have its share of limitations.

  • Certain capabilities or factors of an organization can be both a strength and weakness at the same time. This is one of the major limitations of SWOT analysis . For example changing environmental regulations can be both a threat to company it can also be an opportunity in a sense that it will enable the company to be on a level playing field or at advantage to competitors if it able to develop the products faster than the competitors.
  • SWOT does not show how to achieve a competitive advantage, so it must not be an end in itself.
  • The matrix is only a starting point for a discussion on how proposed strategies could be implemented. It provided an evaluation window but not an implementation plan based on strategic competitiveness of Jabil Circuit
  • SWOT is a static assessment - analysis of status quo with few prospective changes. As circumstances, capabilities, threats, and strategies change, the dynamics of a competitive environment may not be revealed in a single matrix.
  • SWOT analysis may lead the firm to overemphasize a single internal or external factor in formulating strategies. There are interrelationships among the key internal and external factors that SWOT does not reveal that may be important in devising strategies.

Weighted SWOT Analysis of Jabil Circuit

In light of the above mentioned limitations of the SWOT analysis / matrix, corporate managers decided to provide weightage to each internal strength and weakness of the firm. Organizations also assess the likelihood of events taking place in the coming future and how strong their impact could be on company's performance.

This method is called Weighted SWOT analysis. It is better than doing simplistic SWOT analysis because with Weighted SWOT Analysis Jabil Circuit managers can focus on the most critical factors and discount the non-important one. It also solves the long list problem where organizations ends up making a long list but none of the factors deemed too critical.

Limitation of Weighted SWOT analysis of Jabil Circuit

This approach also suffers from one major drawback - it focus on individual importance of factor rather than how they are collectively important and impact the business holistically.

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Example of Weighted SWOT Analysis

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SWOT Worksheet & Template

If you like to do your own SWOT analysis or want to make your own Weighted SWOT SWOT matrix then feel free to download Fern Fort University SWOT Analysis Template.

References / Citations & Bibliography

  • M. E. Porter, Competitive Strategy(New York: Free Press, 1980)
  • A. D. Chandler, Strategy and Structure (Cambridge, Mass.: MIT Press, 1962)
  • O. E. Williamson, Markets and Hierarchies(New York: Free Press, 1975);
  • L. Wrigley, Divisional Autonomy and Diversification (PhD, Harvard Business School, 1970)
  • R. E. White, Generic Business Strategies, Organizational Context and Performance: An Empirical Investigation, Strategic Management Journal7 (1986)