Laboratory Corporation of America Holdings SWOT Analysis / Matrix

Business Essays, Term Papers & Research Papers

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

The Laboratory Corporation of America Holdings is one of the leading companies in its industry. Laboratory Corporation of America Holdings 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 company such as – marketing, finance, operations, management information systems and strategic planning.


Order Now - Laboratory Corporation of America Holdings SWOT Analysis
Check out- Laboratory Corporation of America Holdings PESTEL / PEST & Environment Analysis
Article continues after advertisement


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 Laboratory Corporation of America Holdings 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 Laboratory Corporation of America Holdings strengths, and eradicate its weaknesses.

Step by Step Guide to Laboratory Corporation of America Holdings SWOT Analysis

Strengths of Laboratory Corporation of America Holdings – Internal Strategic Factors

As one of the leading companies in its industry, Laboratory Corporation of America Holdings 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 Laboratory Corporation of America Holdings are –

Read - Laboratory Corporation of America Holdings Porter 5 Forces Analysis & Industry Analysis
Article continues after advertisement

• 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.
• 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.
• Highly skilled workforce through successful training and learning programs. Laboratory Corporation of America Holdings 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.
• Strong Brand Portfolio – Over the years Laboratory Corporation of America Holdings has invested in building a strong brand portfolio. The SWOT analysis of Laboratory Corporation of America Holdings just underlines this fact. This brand portfolio can be extremely useful if the organization wants to expand into new product categories.
• Automation of activities brought consistency of quality to Laboratory Corporation of America Holdings products and has enabled the company to scale up and scale down based on the demand conditions in the market.
• Strong Free Cash Flow – Laboratory Corporation of America Holdings has strong free cash flows that provide resources in the hand of the company to expand into new projects.
• Superb Performance in New Markets – Laboratory Corporation of America Holdings 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.

---

Weakness of Laboratory Corporation of America Holdings – Internal Strategic Factors

Weakness are the areas where Laboratory Corporation of America Holdings 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.

Article continues after advertisement

• Not highly successful at integrating firms with different work culture. As mentioned earlier even though Laboratory Corporation of America Holdings is successful at integrating small companies it has its share of failure to merge firms that have different work culture.
• The profitability ratio and Net Contribution % of Laboratory Corporation of America Holdings are below the industry average.
• Organization structure is only compatible with present business model thus limiting expansion in adjacent product segments.
• Limited success outside core business – Even though Laboratory Corporation of America Holdings is one of the leading organizations in its industry it has faced challenges in moving to other product segments with its present culture.
• 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 Laboratory Corporation of America Holdings
• 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, Laboratory Corporation of America Holdings 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.

Opportunities for Laboratory Corporation of America Holdings – External Strategic Factors

Article continues after advertisement

• New trends in the consumer behavior can open up new market for the Laboratory Corporation of America Holdings . It provides a great opportunity for the organization to build new revenue streams and diversify into new product categories too.
• 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 Laboratory Corporation of America Holdings to drive home its advantage in new technology and gain market share in the new product category.
• 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 Laboratory Corporation of America Holdings. In the next few years the company can leverage this opportunity by knowing its customer better and serving their needs using big data analytics.
• The market development will lead to dilution of competitor’s advantage and enable Laboratory Corporation of America Holdings to increase its competitiveness compare to the other competitors.
• 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.
• 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 Laboratory Corporation of America Holdings 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 Laboratory Corporation of America Holdings 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 Laboratory Corporation of America Holdings.

Threats Laboratory Corporation of America Holdings 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.
• Liability laws in different countries are different and Laboratory Corporation of America Holdings may be exposed to various liability claims given change in policies in those markets.
• 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.
• Imitation of the counterfeit and low quality product is also a threat to Laboratory Corporation of America Holdings’s product especially in the emerging markets and low income markets.
• 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.
• New technologies developed by the competitor or market disruptor could be a serious threat to the industry in medium to long term future.
• 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.

Limitations of SWOT Analysis for Laboratory Corporation of America Holdings

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 Laboratory Corporation of America Holdings
• 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.

Article continues after advertisement

Weighted SWOT Analysis of Laboratory Corporation of America Holdings

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 Laboratory Corporation of America Holdings 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 Laboratory Corporation of America Holdings

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.

Buy Custom Essay and Term Paper on SWOT Analysis / Matrix , Weighted SWOT Analysis of Laboratory Corporation of America Holdings

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)