TFS Financial Corp SWOT Analysis / Matrix

Business Essays, Term Papers & Research Papers

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

The TFS Financial Corp is one of the leading firms in its industry. TFS Financial Corp maintains its prominent position in market by critically analyzing and reviewing the SWOT analysis. SWOT analysis an immensenly interactive process and requires effective coordination among various departments within the company 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 called SWOT Matrix.

The Strengths-Weaknesses-Opportunities-Threats (SWOT) Analysis / Matrix enables the managers of the TFS Financial Corp to develop four types of strategies:

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

TFS Financial Corp swot analysis / matrix

SWOT Matrix Strategies Objective

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

Step by Step Guide to TFS Financial Corp SWOT Analysis

Strengths of TFS Financial Corp – Internal Strategic Factors

As one of the leading companies in its industry, TFS Financial 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 TFS Financial Corp are –

Read - TFS Financial Corp Porter 5 Forces Analysis & Industry Analysis
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Successful track record of developing new products – product innovation.
Good Returns on Capital Expenditure – TFS Financial Corp is relatively successful at execution of new projects and generated good returns on capital expenditure by building new revenue streams.
Highly successful at Go To Market strategies for its products.
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 Brand Portfolio – Over the years TFS Financial Corp has invested in building a strong brand portfolio. The SWOT analysis of TFS Financial Corp 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.
Superb Performance in New Markets – TFS Financial Corp 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.

Weakness of TFS Financial Corp – Internal Strategic Factors

Weakness are the areas where TFS Financial Corp 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.

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High attrition rate in work force – compare to other organizations in the industry TFS Financial Corp has a higher attrition rate and have to spend a lot more compare to its competitors on training and development of its employees.
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. TFS Financial Corp has to build internal feedback mechanism directly from sales team on ground to counter these challenges.
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 TFS Financial Corp is not very good at demand forecasting thus end up keeping higher inventory both in-house and in channel.
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 TFS Financial Corp
Organization structure is only compatible with present business model thus limiting expansion in adjacent product segments.
Not highly successful at integrating firms with different work culture. As mentioned earlier even though TFS Financial Corp 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.

Opportunities for TFS Financial Corp – External Strategic Factors

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The new technology provides an opportunity to TFS Financial 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.
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 TFS Financial Corp to drive home its advantage in new technology and gain market share in the new product category.
Economic uptick and increase in customer spending, after years of recession and slow growth rate in the industry, is an opportunity for TFS Financial Corp to capture new customers and increase its market share.
Government green drive also opens an opportunity for procurement of TFS Financial Corp products by the state as well as federal government contractors.
Opening up of new markets because of government agreement – the adoption of new technology standard and government free trade agreement has provided TFS Financial Corp an opportunity to enter a new emerging market.
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 TFS Financial Corp in other product categories.
The new taxation policy can significantly impact the way of doing business and can open new opportunity for established players such as TFS Financial Corp to increase its profitability.
Lower inflation rate – The low inflation rate bring more stability in the market, enable credit at lower interest rate to the customers of TFS Financial Corp.

Threats TFS Financial Corp 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.
New environment regulations under Paris agreement (2016) could be a threat to certain existing product categories .
Imitation of the counterfeit and low quality product is also a threat to TFS Financial Corp’s product especially in the emerging markets and low income 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.
Shortage of skilled workforce in certain global market represents a threat to steady growth of profits for TFS Financial Corp 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 TFS Financial Corp may be exposed to various liability claims given change in policies in those markets.

Limitations of SWOT Analysis for TFS Financial 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 TFS Financial 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 TFS Financial 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 TFS Financial 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 TFS Financial 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

You can email us to get an example document of Weighted SWOT analysis.

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)