8I Holdings Ltd SWOT Analysis / Matrix

Business Essays, Term Papers & Research Papers

SWOT analysis is a vital strategic planning tool that can be used by 8I Holdings Ltd managers to do a situational analysis of the firm . It is a useful technique to analyze the present Strengths (S), Weakness (W), Opportunities (O) & Threats (T) 8I Holdings Ltd is facing in its current business environment.

The 8I Holdings Ltd is one of the leading organizatations in its industry. 8I Holdings Ltd 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 8I Holdings Ltd 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 core purpose of SWOT matrix is to identify the strategies that an organization can use to exploit external opportunities, counter threats, and build on & protect 8I Holdings Ltd strengths, and eradicate its weaknesses.

Step by Step Guide to 8I Holdings Ltd SWOT Analysis

Strengths of 8I Holdings Ltd – Internal Strategic Factors

As one of the leading organizations in its industry, 8I Holdings Ltd 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 8I Holdings Ltd are –

Read - 8I Holdings Ltd Porter 5 Forces Analysis & Industry Analysis
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Strong distribution network – Over the years 8I Holdings Ltd has built a reliable distribution network that can reach majority of its potential market.
Good Returns on Capital Expenditure – 8I Holdings Ltd is relatively successful at execution of new projects and generated good returns on capital expenditure by building new revenue streams.
Successful track record of developing new products – product innovation.
Automation of activities brought consistency of quality to 8I Holdings Ltd products and has enabled the company to scale up and scale down based on the demand conditions in the market.
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.
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.
Strong Free Cash Flow – 8I Holdings Ltd has strong free cash flows that provide resources in the hand of the company to expand into new projects.
Reliable suppliers – It has a strong base of reliable supplier of raw material thus enabling the company to overcome any supply chain bottlenecks.

Weakness of 8I Holdings Ltd – Internal Strategic Factors

Weakness are the areas where 8I Holdings Ltd 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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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 8I Holdings Ltd
High attrition rate in work force – compare to other organizations in the industry 8I Holdings Ltd has a higher attrition rate and have to spend a lot more compare to its competitors on training and development of its employees.
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 8I Holdings Ltd is one of the leading organizations in its industry it has faced challenges in moving to other product segments with its present culture.
The profitability ratio and Net Contribution % of 8I Holdings Ltd are below the industry average.
Organization structure is only compatible with present business model thus limiting expansion in adjacent product segments.
Need more investment in new technologies. Given the scale of expansion and different geographies the company is planning to expand into, 8I Holdings Ltd 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 8I Holdings Ltd – External Strategic Factors

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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 8I Holdings Ltd to drive home its advantage in new technology and gain market share in the new product category.
Opening up of new markets because of government agreement – the adoption of new technology standard and government free trade agreement has provided 8I Holdings Ltd an opportunity to enter a new emerging market.
Decreasing cost of transportation because of lower shipping prices can also bring down the cost of 8I Holdings Ltd’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.
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 8I Holdings Ltd in other product categories.
Economic uptick and increase in customer spending, after years of recession and slow growth rate in the industry, is an opportunity for 8I Holdings Ltd to capture new customers and increase its market share.
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 8I Holdings Ltd. 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 8I Holdings Ltd to increase its competitiveness compare to the other competitors.
New trends in the consumer behavior can open up new market for the 8I Holdings Ltd . It provides a great opportunity for the organization to build new revenue streams and diversify into new product categories too.

Threats 8I Holdings Ltd Facing - External Strategic Factors

The company can face lawsuits in various markets given - different laws and continuous fluctuations regarding product standards in those markets.
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.
Changing consumer buying behavior from online channel could be a threat to the existing physical infrastructure driven supply chain model.
Increasing trend toward isolationism in the American economy can lead to similar reaction from other government thus negatively impacting the international sales.
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.
Rising raw material can pose a threat to the 8I Holdings Ltd profitability.
Rising pay level especially movements such as $15 an hour and increasing prices in the China can lead to serious pressure on profitability of 8I Holdings Ltd
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 8I Holdings Ltd

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 8I Holdings Ltd
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 8I Holdings Ltd

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 8I Holdings Ltd 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 8I Holdings Ltd

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)