Zion Oil & Gas, Inc. SWOT Analysis / Matrix

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

The Zion Oil & Gas, Inc. is one of the leading organizatations in its industry. Zion Oil & Gas, Inc. maintains its prominent position in market by critically analyzing and reviewing the SWOT analysis.  SWOT analysis an immensenly interactive process and requires effective coordination among various departments within the firm 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 known as SWOT Matrix.

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

  • SO (strengths-opportunities) Strategies
  • WO (weaknesses-opportunities) Strategies
  • ST (strengths-threats) Strategies
  •  WT (weaknesses-threats) Strategies
Zion Oil & Gas, Inc. swot analysis / matrix

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 Zion Oil & Gas, Inc. strengths, and eradicate its weaknesses.

Step by Step Guide to Zion Oil & Gas, Inc. SWOT Analysis

Strengths of Zion Oil & Gas, Inc. – Internal Strategic Factors

As one of the leading organizations in its industry, Zion Oil & Gas, 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 Zion Oil & Gas, 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.
  • Strong distribution network – Over the years Zion Oil & Gas, Inc. has built a reliable distribution network that can reach majority of its potential 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.
  • Successful track record of developing new products – product innovation.
  • Good Returns on Capital Expenditure – Zion Oil & Gas, 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 – Zion Oil & Gas, Inc. has strong free cash flows that provide resources in the hand of the company to expand into new projects.
  • Strong Brand Portfolio – Over the years Zion Oil & Gas, Inc. has invested in building a strong brand portfolio. The SWOT analysis of Zion Oil & Gas, Inc. just underlines this fact. This brand portfolio can be extremely useful if the organization wants to expand into new product categories.

Weakness of Zion Oil & Gas, Inc. – Internal Strategic Factors

Weakness are the areas where Zion Oil & Gas, Inc. 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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  • 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.
  • Organization structure is only compatible with present business model thus limiting expansion in adjacent product segments.
  • The profitability ratio and Net Contribution % of Zion Oil & Gas, Inc. are below the industry average.
  • Need more investment in new technologies. Given the scale of expansion and different geographies the company is planning to expand into, Zion Oil & Gas, Inc. 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.
  • 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. Zion Oil & Gas, Inc. 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 Zion Oil & Gas, Inc. has a higher attrition rate and have to spend a lot more compare to its competitors on training and development of its employees.
  • Not highly successful at integrating firms with different work culture. As mentioned earlier even though Zion Oil & Gas, Inc. is successful at integrating small companies it has its share of failure to merge firms that have different work culture.

Opportunities for Zion Oil & Gas, Inc. – External Strategic Factors

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

Threats Zion Oil & Gas, 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.
  • New technologies developed by the competitor or market disruptor could be a serious threat to the industry in medium to long term future.
  • Increasing trend toward isolationism in the American economy can lead to similar reaction from other government thus negatively impacting the international sales.
  • 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.
  • Liability laws in different countries are different and Zion Oil & Gas, Inc. may be exposed to various liability claims given change in policies in those markets.
  • New environment regulations under Paris agreement (2016) could be a threat to certain existing product categories .
  • Rising pay level especially movements such as $15 an hour and increasing prices in the China can lead to serious pressure on profitability of Zion Oil & Gas, Inc.
  • 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 Zion Oil & Gas, 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 Zion Oil & Gas, 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 Zion Oil & Gas, 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 Zion Oil & Gas, 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 Zion Oil & Gas, 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)