SandRidge Mississippian Trust I SWOT Analysis / Matrix

Business Essays, Term Papers & Research Papers

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

The SandRidge Mississippian Trust I is one of the leading companies in its industry. SandRidge Mississippian Trust I 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 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 called SWOT Matrix.

The Strengths-Weaknesses-Opportunities-Threats (SWOT) Analysis / Matrix helps the managers of the SandRidge Mississippian Trust I to develop four types of strategies:

  • SO (strengths-opportunities) Strategies
  • WO (weaknesses-opportunities) Strategies
  • ST (strengths-threats) Strategies
  •  WT (weaknesses-threats) Strategies
SandRidge Mississippian Trust I 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 SandRidge Mississippian Trust I strengths, and eradicate its weaknesses.

Step by Step Guide to SandRidge Mississippian Trust I SWOT Analysis

Strengths of SandRidge Mississippian Trust I – Internal Strategic Factors

As one of the leading companies in its industry, SandRidge Mississippian Trust I 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 SandRidge Mississippian Trust I are –

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  • Highly skilled workforce through successful training and learning programs. SandRidge Mississippian Trust I 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.
  • Automation of activities brought consistency of quality to SandRidge Mississippian Trust I products and has enabled the company to scale up and scale down based on the demand conditions in the market.
  • Strong Free Cash Flow – SandRidge Mississippian Trust I has strong free cash flows that provide resources in the hand of the company to expand into new projects.
  • Good Returns on Capital Expenditure – SandRidge Mississippian Trust I 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 – SandRidge Mississippian Trust I 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.
  • Reliable suppliers – It has a strong base of reliable supplier of raw material thus enabling the company to overcome any supply chain bottlenecks.
  • Strong distribution network – Over the years SandRidge Mississippian Trust I has built a reliable distribution network that can reach majority of its potential market.

Weakness of SandRidge Mississippian Trust I – Internal Strategic Factors

Weakness are the areas where SandRidge Mississippian Trust I can improve upon. Strategy is about making choices and weakness are the areas where a firm can improve using SWOT analysis and build on its competitive advantage and strategic positioning.

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  • Investment in Research and Development is below the fastest growing players in the industry. Even though SandRidge Mississippian Trust I 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 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. SandRidge Mississippian Trust I 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 SandRidge Mississippian Trust I is not very good at demand forecasting thus end up keeping higher inventory both in-house and in channel.
  • 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 SandRidge Mississippian Trust I are below the industry average.
  • High attrition rate in work force – compare to other organizations in the industry SandRidge Mississippian Trust I has a higher attrition rate and have to spend a lot more compare to its competitors on training and development of its employees.
  • Need more investment in new technologies. Given the scale of expansion and different geographies the company is planning to expand into, SandRidge Mississippian Trust I 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 SandRidge Mississippian Trust I – External Strategic Factors

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  • Economic uptick and increase in customer spending, after years of recession and slow growth rate in the industry, is an opportunity for SandRidge Mississippian Trust I to capture new customers and increase its market share.
  • Government green drive also opens an opportunity for procurement of SandRidge Mississippian Trust I products by the state as well as federal government contractors.
  • The new taxation policy can significantly impact the way of doing business and can open new opportunity for established players such as SandRidge Mississippian Trust I to increase its profitability.
  • New trends in the consumer behavior can open up new market for the SandRidge Mississippian Trust I . It provides a great opportunity for the organization to build new revenue streams and diversify into new product categories too.
  • The market development will lead to dilution of competitor’s advantage and enable SandRidge Mississippian Trust I to increase its competitiveness compare to the other competitors.
  • The new technology provides an opportunity to SandRidge Mississippian Trust I 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.
  • 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 SandRidge Mississippian Trust I in other product categories.
  • Lower inflation rate – The low inflation rate bring more stability in the market, enable credit at lower interest rate to the customers of SandRidge Mississippian Trust I.

Threats SandRidge Mississippian Trust I Facing - External Strategic Factors

  • 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.
  • Rising pay level especially movements such as $15 an hour and increasing prices in the China can lead to serious pressure on profitability of SandRidge Mississippian Trust I
  • Imitation of the counterfeit and low quality product is also a threat to SandRidge Mississippian Trust I’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.
  • New technologies developed by the competitor or market disruptor could be a serious threat to the industry in medium to long term future.
  • As the company is operating in numerous countries it is exposed to currency fluctuations especially given the volatile political climate in number of markets across the world.
  • Increasing trend toward isolationism in the American economy can lead to similar reaction from other government thus negatively impacting the international sales.
  • The company can face lawsuits in various markets given - different laws and continuous fluctuations regarding product standards in those markets.

Limitations of SWOT Analysis for SandRidge Mississippian Trust I

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 SandRidge Mississippian Trust I
  • 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 SandRidge Mississippian Trust I

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 SandRidge Mississippian Trust I 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 SandRidge Mississippian Trust I

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)