Resources Connection, Inc. SWOT Analysis / Matrix

Business Essays, Term Papers & Research Papers

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

The Resources Connection, Inc. is one of the leading firms in its industry. Resources Connection, Inc. 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 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 known as SWOT Matrix.

The Strengths-Weaknesses-Opportunities-Threats (SWOT) Analysis / Matrix enables the managers of the Resources Connection, Inc. to develop four types of strategies:

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

Resources Connection, Inc. swot analysis / matrix

SWOT Matrix Strategies Objective

The core purpose of SWOT matrix is to identify the strategies that a firm can use to exploit external opportunities, counter threats, and build on & protect Resources Connection, Inc. strengths, and eradicate its weaknesses.

Step by Step Guide to Resources Connection, Inc. SWOT Analysis

Strengths of Resources Connection, Inc. – Internal Strategic Factors

As one of the leading firms in its industry, Resources Connection, 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 Resources Connection, Inc. are –

Read - Resources Connection, Inc. Porter 5 Forces Analysis & Industry Analysis
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Good Returns on Capital Expenditure – Resources Connection, Inc. is relatively successful at execution of new projects and generated good returns on capital expenditure by building new revenue streams.
Strong Free Cash Flow – Resources Connection, Inc. has strong free cash flows that provide resources in the hand of the company to expand into new projects.
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.
Successful track record of developing new products – product innovation.
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.
Reliable suppliers – It has a strong base of reliable supplier of raw material thus enabling the company to overcome any supply chain bottlenecks.
Automation of activities brought consistency of quality to Resources Connection, Inc. 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 – Resources Connection, 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.

Weakness of Resources Connection, Inc. – Internal Strategic Factors

Weakness are the areas where Resources Connection, 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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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 Resources Connection, Inc. is successful at integrating small companies it has its share of failure to merge firms that have different work 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 Resources Connection, Inc.
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.
Investment in Research and Development is below the fastest growing players in the industry. Even though Resources Connection, 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.
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.
Limited success outside core business – Even though Resources Connection, Inc. is one of the leading organizations in its industry it has faced challenges in moving to other product segments with its present culture.

Opportunities for Resources Connection, Inc. – External Strategic Factors

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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 Resources Connection, 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.
Decreasing cost of transportation because of lower shipping prices can also bring down the cost of Resources Connection, Inc.’s products thus providing an opportunity to the company - either to boost its profitability or pass on the benefits to the customers to gain market share.
Economic uptick and increase in customer spending, after years of recession and slow growth rate in the industry, is an opportunity for Resources Connection, Inc. to capture new customers and increase its market share.
New trends in the consumer behavior can open up new market for the Resources Connection, Inc. . It provides a great opportunity for the organization to build new revenue streams and diversify into new product categories too.
Opening up of new markets because of government agreement – the adoption of new technology standard and government free trade agreement has provided Resources Connection, Inc. an opportunity to enter a new emerging market.
Government green drive also opens an opportunity for procurement of Resources Connection, Inc. products by the state as well as federal government contractors.
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 Resources Connection, Inc. to drive home its advantage in new technology and gain market share in the new product category.
Lower inflation rate – The low inflation rate bring more stability in the market, enable credit at lower interest rate to the customers of Resources Connection, Inc..

Threats Resources Connection, Inc. 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.
Rising pay level especially movements such as $15 an hour and increasing prices in the China can lead to serious pressure on profitability of Resources Connection, Inc.
Imitation of the counterfeit and low quality product is also a threat to Resources Connection, Inc.’s product especially in the emerging markets and low income markets.
Growing strengths of local distributors also presents a threat in some markets as the competition is paying higher margins to the local distributors.
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 Resources Connection, Inc. may be exposed to various liability claims given change in policies in those markets.
Rising raw material can pose a threat to the Resources Connection, Inc. profitability.
Changing consumer buying behavior from online channel could be a threat to the existing physical infrastructure driven supply chain model.

Limitations of SWOT Analysis for Resources Connection, 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 Resources Connection, 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 Resources Connection, 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 Resources Connection, 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 Resources Connection, 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)