Synalloy Corporation SWOT Analysis / Matrix

Business Essays, Term Papers & Research Papers

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

The Synalloy Corporation is one of the leading organizatations in its industry. Synalloy Corporation 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 - Synalloy Corporation SWOT Analysis
Check out- Synalloy Corporation PESTEL / PEST & Environment Analysis
Article continues after advertisement


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 known as SWOT Matrix.

The Strengths-Weaknesses-Opportunities-Threats (SWOT) Analysis / Matrix enables the managers of the Synalloy Corporation 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 main purpose of SWOT matrix is to identify the strategies that a firm can utilize to exploit external opportunities, counter threats, and build on & protect Synalloy Corporation strengths, and eradicate its weaknesses.

Step by Step Guide to Synalloy Corporation SWOT Analysis

Strengths of Synalloy Corporation – Internal Strategic Factors

As one of the leading organizations in its industry, Synalloy Corporation 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 Synalloy Corporation are –

Read - Synalloy Corporation Porter 5 Forces Analysis & Industry Analysis
Article continues after advertisement

• Strong Free Cash Flow – Synalloy Corporation has strong free cash flows that provide resources in the hand of the company to expand into new projects.
• Highly successful at Go To Market strategies for its products.
• Strong distribution network – Over the years Synalloy Corporation has built a reliable distribution network that can reach majority of its potential market.
• Automation of activities brought consistency of quality to Synalloy Corporation products and has enabled the company to scale up and scale down based on the demand conditions in the 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.
• Strong Brand Portfolio – Over the years Synalloy Corporation has invested in building a strong brand portfolio. The SWOT analysis of Synalloy Corporation just underlines this fact. This brand portfolio can be extremely useful if the organization wants to expand into new product categories.
• Highly skilled workforce through successful training and learning programs. Synalloy Corporation 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.
• 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 Synalloy Corporation – Internal Strategic Factors

Weakness are the areas where Synalloy Corporation 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.

Article continues after advertisement

• 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.
• Not highly successful at integrating firms with different work culture. As mentioned earlier even though Synalloy Corporation is successful at integrating small companies it has its share of failure to merge firms that have different work culture.
• Organization structure is only compatible with present business model thus limiting expansion in adjacent product segments.
• 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 Synalloy Corporation is not very good at demand forecasting thus end up keeping higher inventory both in-house and in channel.
• 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 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. Synalloy Corporation has to build internal feedback mechanism directly from sales team on ground to counter these challenges.
• High attrition rate in work force – compare to other organizations in the industry Synalloy Corporation has a higher attrition rate and have to spend a lot more compare to its competitors on training and development of its employees.

Opportunities for Synalloy Corporation – External Strategic Factors

Article continues after advertisement

• Opening up of new markets because of government agreement – the adoption of new technology standard and government free trade agreement has provided Synalloy Corporation an opportunity to enter a new emerging market.
• 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 Synalloy Corporation in other product categories.
• Decreasing cost of transportation because of lower shipping prices can also bring down the cost of Synalloy Corporation’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.
• 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 Synalloy Corporation. In the next few years the company can leverage this opportunity by knowing its customer better and serving their needs using big data analytics.
• New trends in the consumer behavior can open up new market for the Synalloy Corporation . It provides a great opportunity for the organization to build new revenue streams and diversify into new product categories too.
• Government green drive also opens an opportunity for procurement of Synalloy Corporation 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 Synalloy Corporation to increase its profitability.
• The market development will lead to dilution of competitor’s advantage and enable Synalloy Corporation to increase its competitiveness compare to the other competitors.

Threats Synalloy Corporation Facing - External Strategic Factors

• New environment regulations under Paris agreement (2016) could be a threat to certain existing product categories .
• 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.
• Shortage of skilled workforce in certain global market represents a threat to steady growth of profits for Synalloy Corporation   in those 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.
• Rising pay level especially movements such as $15 an hour and increasing prices in the China can lead to serious pressure on profitability of Synalloy Corporation
• Liability laws in different countries are different and Synalloy Corporation 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 Synalloy Corporation’s product especially in the emerging markets and low income markets.

Limitations of SWOT Analysis for Synalloy Corporation

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 Synalloy Corporation
• 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 Synalloy Corporation

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 Synalloy Corporation 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 Synalloy Corporation

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 Synalloy Corporation

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)