MainSource Financial Group, Inc. SWOT Analysis / Matrix

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SWOT analysis is a strategic planning tool that can be used by MainSource Financial Group, Inc. managers to do a situational analysis of the firm . It is an important technique to analyze the present Strengths (S), Weakness (W), Opportunities (O) & Threats (T) MainSource Financial Group, Inc. is facing in its current business environment.

The MainSource Financial Group, Inc. is one of the leading companies in its industry. MainSource Financial Group, Inc. 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 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 helps the managers of the MainSource Financial Group, Inc. to develop four types of strategies:

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

MainSource Financial Group, Inc. swot analysis / matrix

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 MainSource Financial Group, Inc. strengths, and eradicate its weaknesses.

Step by Step Guide to MainSource Financial Group, Inc. SWOT Analysis

Strengths of MainSource Financial Group, Inc. – Internal Strategic Factors

As one of the leading companies in its industry, MainSource Financial Group, Inc. 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 MainSource Financial Group, Inc. are –

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Highly successful at Go To Market strategies for its products.
Strong Brand Portfolio – Over the years MainSource Financial Group, Inc. has invested in building a strong brand portfolio. The SWOT analysis of MainSource Financial Group, Inc. just underlines this fact. This brand portfolio can be extremely useful if the organization wants to expand into new product categories.
Reliable suppliers – It has a strong base of reliable supplier of raw material thus enabling the company to overcome any supply chain bottlenecks.
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. MainSource Financial Group, Inc. 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 – MainSource Financial Group, Inc. is relatively successful at execution of new projects and generated good returns on capital expenditure by building new revenue streams.
Superb Performance in New Markets – MainSource Financial Group, Inc. 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.
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.

Weakness of MainSource Financial Group, Inc. – Internal Strategic Factors

Weakness are the areas where MainSource Financial Group, Inc. 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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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 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. MainSource Financial Group, Inc. has to build internal feedback mechanism directly from sales team on ground to counter these challenges.
Need more investment in new technologies. Given the scale of expansion and different geographies the company is planning to expand into, MainSource Financial Group, Inc. 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 MainSource Financial Group, Inc. is one of the leading organizations in its industry it has faced challenges in moving to other product segments with its present culture.
Investment in Research and Development is below the fastest growing players in the industry. Even though MainSource Financial Group, Inc. 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.
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 MainSource Financial Group, Inc. is not very good at demand forecasting thus end up keeping higher inventory both in-house and in channel.

Opportunities for MainSource Financial Group, Inc. – External Strategic Factors

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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 trends in the consumer behavior can open up new market for the MainSource Financial Group, Inc. . It provides a great opportunity for the organization to build new revenue streams and diversify into new product categories too.
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 MainSource Financial Group, Inc. 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 MainSource Financial Group, Inc. to capture new customers and increase its market share.
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 MainSource Financial Group, Inc.. 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 MainSource Financial Group, Inc. an opportunity to enter a new emerging market.
Government green drive also opens an opportunity for procurement of MainSource Financial Group, Inc. products by the state as well as federal government contractors.
Lower inflation rate – The low inflation rate bring more stability in the market, enable credit at lower interest rate to the customers of MainSource Financial Group, Inc..

Threats MainSource Financial Group, Inc. Facing - External Strategic Factors

The company can face lawsuits in various markets given - different laws and continuous fluctuations regarding product standards 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.
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.
New environment regulations under Paris agreement (2016) could be a threat to certain existing product categories .
New technologies developed by the competitor or market disruptor could be a serious threat to the industry in medium to long term future.
Increasing trend toward isolationism in the American economy can lead to similar reaction from other government thus negatively impacting the international sales.
Growing strengths of local distributors also presents a threat in some markets as the competition is paying higher margins to the local distributors.
Rising raw material can pose a threat to the MainSource Financial Group, Inc. profitability.

Limitations of SWOT Analysis for MainSource Financial Group, Inc.

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 MainSource Financial Group, Inc.
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 MainSource Financial Group, Inc.

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 MainSource Financial Group, Inc. 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 MainSource Financial Group, Inc.

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)