Crescent Point Energy Corp. SWOT Analysis / Matrix

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

The Crescent Point Energy Corp. is one of the leading firms in its industry. Crescent Point Energy Corp. maintains its prominent position in market by carefully analyzing and reviewing the SWOT analysis.  SWOT analysis an immensenly interactive process and requires effective coordination among various departments within the firm such as – marketing, finance, operations, management information systems and strategic planning.

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The SWOT Analysis framework enables 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 Crescent Point Energy Corp. to develop four types of strategies:

  • SO (strengths-opportunities) Strategies
  • WO (weaknesses-opportunities) Strategies
  • ST (strengths-threats) Strategies
  •  WT (weaknesses-threats) Strategies
Crescent Point Energy Corp. swot analysis / matrix

SWOT Matrix Strategies Objective

The main purpose of SWOT matrix is to identify the strategies that a company can utilize to exploit external opportunities, counter threats, and build on & protect Crescent Point Energy Corp. strengths, and eradicate its weaknesses.

Step by Step Guide to Crescent Point Energy Corp. SWOT Analysis

Strengths of Crescent Point Energy Corp. – Internal Strategic Factors

As one of the leading firms in its industry, Crescent Point Energy Corp. 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 Crescent Point Energy Corp. are –

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  • Strong distribution network – Over the years Crescent Point Energy Corp. has built a reliable distribution network that can reach majority of its potential market.
  • Highly skilled workforce through successful training and learning programs. Crescent Point Energy Corp. 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.
  • Highly successful at Go To Market strategies for its products.
  • Successful track record of developing new products – product innovation.
  • Reliable suppliers – It has a strong base of reliable supplier of raw material thus enabling the company to overcome any supply chain bottlenecks.
  • Good Returns on Capital Expenditure – Crescent Point Energy Corp. is relatively successful at execution of new projects and generated good returns on capital expenditure by building new revenue streams.
  • Strong Free Cash Flow – Crescent Point Energy Corp. has strong free cash flows that provide resources in the hand of the company to expand into new projects.
  • 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.

Weakness of Crescent Point Energy Corp. – Internal Strategic Factors

Weakness are the areas where Crescent Point Energy Corp. 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.

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  • 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 Crescent Point Energy Corp.
  • 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.
  • Not highly successful at integrating firms with different work culture. As mentioned earlier even though Crescent Point Energy Corp. is successful at integrating small companies it has its share of failure to merge firms that have different work culture.
  • 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.
  • Need more investment in new technologies. Given the scale of expansion and different geographies the company is planning to expand into, Crescent Point Energy Corp. 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.
  • 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.
  • High attrition rate in work force – compare to other organizations in the industry Crescent Point Energy Corp. 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 Crescent Point Energy Corp. – External Strategic Factors

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  • Opening up of new markets because of government agreement – the adoption of new technology standard and government free trade agreement has provided Crescent Point Energy Corp. an opportunity to enter a new emerging market.
  • Lower inflation rate – The low inflation rate bring more stability in the market, enable credit at lower interest rate to the customers of Crescent Point Energy Corp..
  • The market development will lead to dilution of competitor’s advantage and enable Crescent Point Energy Corp. to increase its competitiveness compare to the other competitors.
  • New environmental policies – The new opportunities will create a level playing field for all the players in the industry. It represent a great opportunity for Crescent Point Energy Corp. to drive home its advantage in new technology and gain market share in the new product category.
  • The new technology provides an opportunity to Crescent Point Energy Corp. 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 Crescent Point Energy Corp. products by the state as well as federal government contractors.
  • 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.
  • 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 Crescent Point Energy Corp.. In the next few years the company can leverage this opportunity by knowing its customer better and serving their needs using big data analytics.

Threats Crescent Point Energy Corp. Facing - External Strategic Factors

  • Shortage of skilled workforce in certain global market represents a threat to steady growth of profits for Crescent Point Energy Corp.   in those markets.
  • Liability laws in different countries are different and Crescent Point Energy Corp. may be exposed to various liability claims given change in policies in those markets.
  • 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.
  • New technologies developed by the competitor or market disruptor could be a serious threat to the industry in medium to long term future.
  • 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.
  • New environment regulations under Paris agreement (2016) could be a threat to certain existing product categories .
  • Growing strengths of local distributors also presents a threat in some markets as the competition is paying higher margins to the local distributors.
  • 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.

Limitations of SWOT Analysis for Crescent Point Energy Corp.

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 Crescent Point Energy Corp.
  • 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.

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Weighted SWOT Analysis of Crescent Point Energy Corp.

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 Crescent Point Energy Corp. 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 Crescent Point Energy Corp.

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)