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Genesee & Wyoming SWOT Analysis / Matrix
Essays, Term Papers & Research Papers
SWOT analysis is a strategic planning tool that can be used by Genesee & Wyoming managers to do a situational analysis of the organization . It is a handy technique to evalauate the present Strengths (S), Weakness (W), Opportunities (O) & Threats (T) Genesee & Wyoming is facing in its current business environment.
The Genesee & Wyoming is one of the leading companies in its industry. Genesee & Wyoming 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 facilitates 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 known as SWOT Matrix.
The Strengths-Weaknesses-Opportunities-Threats (SWOT) Analysis / Matrix enables the managers of the Genesee & Wyoming 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 core purpose of SWOT matrix is to identify the strategies that a company can use to exploit external opportunities, counter threats, and build on & protect Genesee & Wyoming strengths, and eradicate its weaknesses.
Step by Step Guide to Genesee & Wyoming SWOT Analysis
Strengths of Genesee & Wyoming – Internal Strategic Factors
As one of the leading organizations in its industry, Genesee & Wyoming 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 Genesee & Wyoming are –
- Automation of activities brought consistency of quality to Genesee & Wyoming products and has enabled the company to scale up and scale down based on the demand conditions in the market.
- Superb Performance in New Markets – Genesee & Wyoming has built expertise at entering new markets and making success of them. The expansion has helped the organization to build new revenue stream and diversify the economic cycle risk in the markets it operates in.
- 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.
- Strong Free Cash Flow – Genesee & Wyoming has strong free cash flows that provide resources in the hand of the company to expand into new projects.
- Strong Brand Portfolio – Over the years Genesee & Wyoming has invested in building a strong brand portfolio. The SWOT analysis of Genesee & Wyoming just underlines this fact. This brand portfolio can be extremely useful if the organization wants to expand into new product categories.
- Highly successful at Go To Market strategies for its products.
- Strong distribution network – Over the years Genesee & Wyoming has built a reliable distribution network that can reach majority of its potential market.
- Good Returns on Capital Expenditure – Genesee & Wyoming is relatively successful at execution of new projects and generated good returns on capital expenditure by building new revenue streams.
Weakness of Genesee & Wyoming – Internal Strategic Factors
Weakness are the areas where Genesee & Wyoming can improve upon. Strategy is about making choices and weakness are the areas where a company can improve using SWOT analysis and build on its competitive advantage and strategic positioning.
- Investment in Research and Development is below the fastest growing players in the industry. Even though Genesee & Wyoming is spending above the industry average on Research and Development, it has not been able to compete with the leading players in the industry in terms of innovation. It has come across as a mature firm looking forward to bring out products based on tested features in the market.
- 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.
- The profitability ratio and Net Contribution % of Genesee & Wyoming 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. Genesee & Wyoming has to build internal feedback mechanism directly from sales team on ground to counter these challenges.
- Not highly successful at integrating firms with different work culture. As mentioned earlier even though Genesee & Wyoming is successful at integrating small companies it has its share of failure to merge firms that have different work culture.
- 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.
Opportunities for Genesee & Wyoming – 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 Genesee & Wyoming.
- The new taxation policy can significantly impact the way of doing business and can open new opportunity for established players such as Genesee & Wyoming to increase its profitability.
- New customers from online channel – Over the past few years the company has invested vast sum of money into the online platform. This investment has opened new sales channel for Genesee & Wyoming. In the next few years the company can leverage this opportunity by knowing its customer better and serving their needs using big data analytics.
- Opening up of new markets because of government agreement – the adoption of new technology standard and government free trade agreement has provided Genesee & Wyoming an opportunity to enter a new emerging market.
- The new technology provides an opportunity to Genesee & Wyoming 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 Genesee & Wyoming 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 Genesee & Wyoming to capture new customers and increase its market share.
- The market development will lead to dilution of competitor’s advantage and enable Genesee & Wyoming to increase its competitiveness compare to the other competitors.
Threats Genesee & Wyoming Facing - External Strategic Factors
- Growing strengths of local distributors also presents a threat in some markets as the competition is paying higher margins to the local distributors.
- 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.
- Increasing trend toward isolationism in the American economy can lead to similar reaction from other government thus negatively impacting the international sales.
- New technologies developed by the competitor or market disruptor could be a serious threat to the industry in medium to long term future.
- The company can face lawsuits in various markets given - different laws and continuous fluctuations regarding product standards in those markets.
- Liability laws in different countries are different and Genesee & Wyoming may be exposed to various liability claims given change in policies in those markets.
- 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 Genesee & Wyoming
Limitations of SWOT Analysis for Genesee & Wyoming
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 Genesee & Wyoming
- 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 Genesee & Wyoming
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 Genesee & Wyoming 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 Genesee & Wyoming
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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SWOT Worksheet & Template
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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)
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