Boston Scientific SWOT Analysis / Matrix

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

The Boston Scientific is one of the leading organizatations in its industry. Boston Scientific maintains its dominant position in market by carefully analyzing and reviewing the SWOT analysis.  SWOT analysis a highly interactive process and requires effective coordination among various departments within the organization 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 enables the managers of the Boston Scientific to develop four types of strategies:

• SO (strengths-opportunities) Strategies
• WO (weaknesses-opportunities) Strategies
• ST (strengths-threats) Strategies
•  WT (weaknesses-threats) Strategies

SWOT Matrix Strategies Objective

The primary purpose of SWOT matrix is to identify the strategies that a company can use to exploit external opportunities, counter threats, and build on & protect Boston Scientific strengths, and eradicate its weaknesses.

Step by Step Guide to Boston Scientific SWOT Analysis

Strengths of Boston Scientific – Internal Strategic Factors

As one of the leading firms in its industry, Boston Scientific 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 Boston Scientific are –

• 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 Boston Scientific has invested in building a strong brand portfolio. The SWOT analysis of Boston Scientific just underlines this fact. This brand portfolio can be extremely useful if the organization wants to expand into new product categories.
• Successful track record of integrating complimentary firms through mergers & acquisition. It has successfully integrated number of technology companies in the past few years to streamline its operations and to build a reliable supply chain.
• High level of customer satisfaction – the company with its dedicated customer relationship management department has able to achieve a high level of customer satisfaction among present customers and good brand equity among the potential customers.
• Strong distribution network – Over the years Boston Scientific has built a reliable distribution network that can reach majority of its potential market.
• Automation of activities brought consistency of quality to Boston Scientific products and has enabled the company to scale up and scale down based on the demand conditions in the market.
• Highly skilled workforce through successful training and learning programs. Boston Scientific 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.
• Good Returns on Capital Expenditure – Boston Scientific is relatively successful at execution of new projects and generated good returns on capital expenditure by building new revenue streams.

Weakness of Boston Scientific – Internal Strategic Factors

Weakness are the areas where Boston Scientific can improve upon. Strategy is about making choices and weakness are the areas where an organization can improve using SWOT analysis and build on its competitive advantage and strategic positioning.

• Need more investment in new technologies. Given the scale of expansion and different geographies the company is planning to expand into, Boston Scientific needs to put more money in technology to integrate the processes across the board. Right now the investment in technologies is not at par with the vision of the company.
• Limited success outside core business – Even though Boston Scientific is one of the leading organizations in its industry it has faced challenges in moving to other product segments with its present culture.
• 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.
• 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.
• The profitability ratio and Net Contribution % of Boston Scientific are below the industry average.
• The company has not being able to tackle the challenges present by the new entrants in the segment and has lost small market share in the niche categories. Boston Scientific has to build internal feedback mechanism directly from sales team on ground to counter these challenges.
• High attrition rate in work force – compare to other organizations in the industry Boston Scientific has a higher attrition rate and have to spend a lot more compare to its competitors on training and development of its employees.

Opportunities for Boston Scientific – External Strategic Factors

• Lower inflation rate – The low inflation rate bring more stability in the market, enable credit at lower interest rate to the customers of Boston Scientific.
• Opening up of new markets because of government agreement – the adoption of new technology standard and government free trade agreement has provided Boston Scientific an opportunity to enter a new emerging market.
• New trends in the consumer behavior can open up new market for the Boston Scientific . It provides a great opportunity for the organization to build new revenue streams and diversify into new product categories too.
• The market development will lead to dilution of competitor’s advantage and enable Boston Scientific to increase its competitiveness compare to the other competitors.
• The new technology provides an opportunity to Boston Scientific 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.
• Government green drive also opens an opportunity for procurement of Boston Scientific products by the state as well as federal government contractors.
• Economic uptick and increase in customer spending, after years of recession and slow growth rate in the industry, is an opportunity for Boston Scientific to capture new customers and increase its market share.
• Organization’s core competencies can be a success in similar other products field. A comparative example could be - GE healthcare research helped it in developing better Oil drilling machines.

Threats Boston Scientific Facing - External Strategic Factors

• New environment regulations under Paris agreement (2016) could be a threat to certain existing product categories .
• 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.
• The demand of the highly profitable products is seasonal in nature and any unlikely event during the peak season may impact the profitability of the company in short to medium term.
• Intense competition – Stable profitability has increased the number of players in the industry over last two years which has put downward pressure on not only profitability but also on overall sales.
• Rising pay level especially movements such as $15 an hour and increasing prices in the China can lead to serious pressure on profitability of Boston Scientific
• No regular supply of innovative products – Over the years the company has developed numerous products but those are often response to the development by other players. Secondly the supply of new products is not regular thus leading to high and low swings in the sales number over period of time.
• Rising raw material can pose a threat to the Boston Scientific profitability.
• Liability laws in different countries are different and Boston Scientific may be exposed to various liability claims given change in policies in those markets.

Limitations of SWOT Analysis for Boston Scientific

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 Boston Scientific
• 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 Boston Scientific

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 Boston Scientific 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 Boston Scientific

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)