WEC Energy Group, Inc. SWOT Analysis / Matrix

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SWOT analysis is a vital strategic planning tool that can be used by WEC Energy Group, Inc. managers to do a situational analysis of the organization . It is a handy technique to understand the present Strengths (S), Weakness (W), Opportunities (O) & Threats (T) WEC Energy Group, Inc. is facing in its current business environment.

The WEC Energy Group, Inc. is one of the leading firms in its industry. WEC Energy Group, Inc. maintains its dominant 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 organization such as – marketing, finance, operations, management information systems and strategic planning.

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The SWOT Analysis framework helps 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 helps the managers of the WEC Energy Group, Inc. to develop four types of strategies:

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

WEC Energy Group, Inc. swot analysis / matrix

SWOT Matrix Strategies Objective

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

Step by Step Guide to WEC Energy Group, Inc. SWOT Analysis

Strengths of WEC Energy Group, Inc. – Internal Strategic Factors

As one of the leading organizations in its industry, WEC Energy Group, Inc. has numerous strengths that enable 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 WEC Energy Group, Inc. are –

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Reliable suppliers – It has a strong base of reliable supplier of raw material thus enabling the company to overcome any supply chain bottlenecks.
Highly skilled workforce through successful training and learning programs. WEC Energy 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.
Highly successful at Go To Market strategies for its products.
Good Returns on Capital Expenditure – WEC Energy Group, Inc. is relatively successful at execution of new projects and generated good returns on capital expenditure by building new revenue streams.
Strong distribution network – Over the years WEC Energy Group, Inc. has built a reliable distribution network that can reach majority of its potential market.
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.
Superb Performance in New Markets – WEC Energy 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.
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.

Weakness of WEC Energy Group, Inc. – Internal Strategic Factors

Weakness are the areas where WEC Energy 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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Not highly successful at integrating firms with different work culture. As mentioned earlier even though WEC Energy Group, Inc. is successful at integrating small companies it has its share of failure to merge firms that have different work culture.
Limited success outside core business – Even though WEC Energy 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.
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.
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.
The profitability ratio and Net Contribution % of WEC Energy Group, Inc. are below the industry average.
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.
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 WEC Energy Group, Inc.

Opportunities for WEC Energy 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 WEC Energy 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 WEC Energy Group, Inc. 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 WEC Energy Group, Inc. 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 WEC Energy Group, Inc..
Government green drive also opens an opportunity for procurement of WEC Energy Group, 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 WEC Energy Group, Inc. 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 WEC Energy 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.

Threats WEC Energy Group, Inc. Facing - External Strategic Factors

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.
Rising pay level especially movements such as $15 an hour and increasing prices in the China can lead to serious pressure on profitability of WEC Energy Group, Inc.
Liability laws in different countries are different and WEC Energy Group, Inc. may be exposed to various liability claims given change in policies in those markets.
Imitation of the counterfeit and low quality product is also a threat to WEC Energy Group, Inc.’s product especially in the emerging markets and low income markets.
Shortage of skilled workforce in certain global market represents a threat to steady growth of profits for WEC Energy Group, Inc. 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.
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.

Limitations of SWOT Analysis for WEC Energy 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 WEC Energy 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 WEC Energy 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 WEC Energy 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 WEC Energy 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)