S2 Resources Ltd SWOT Analysis / Matrix

Business Essays, Term Papers & Research Papers

SWOT analysis is a vital strategic planning tool that can be used by S2 Resources Ltd managers to do a situational analysis of the firm . It is an important technique to evalauate the present Strengths (S), Weakness (W), Opportunities (O) & Threats (T) S2 Resources Ltd is facing in its current business environment.

The S2 Resources Ltd is one of the leading companies in its industry. S2 Resources Ltd maintains its dominant 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 called SWOT Matrix.

The Strengths-Weaknesses-Opportunities-Threats (SWOT) Analysis / Matrix helps the managers of the S2 Resources 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 main purpose of SWOT matrix is to identify the strategies that a company can use to exploit external opportunities, counter threats, and build on & protect S2 Resources Ltd strengths, and eradicate its weaknesses.

Step by Step Guide to S2 Resources Ltd SWOT Analysis

Strengths of S2 Resources Ltd – Internal Strategic Factors

As one of the leading firms in its industry, S2 Resources Ltd 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 S2 Resources Ltd are –

Read - S2 Resources Ltd Porter 5 Forces Analysis & Industry Analysis
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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.
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.
Good Returns on Capital Expenditure – S2 Resources Ltd is relatively successful at execution of new projects and generated good returns on capital expenditure by building new revenue streams.
Highly successful at Go To Market strategies for its products.
Successful track record of developing new products – product innovation.
Strong distribution network – Over the years S2 Resources Ltd has built a reliable distribution network that can reach majority of its potential market.
Automation of activities brought consistency of quality to S2 Resources Ltd products and has enabled the company to scale up and scale down based on the demand conditions in the market.
Strong Brand Portfolio – Over the years S2 Resources Ltd has invested in building a strong brand portfolio. The SWOT analysis of S2 Resources Ltd just underlines this fact. This brand portfolio can be extremely useful if the organization wants to expand into new product categories.

Weakness of S2 Resources Ltd – Internal Strategic Factors

Weakness are the areas where S2 Resources Ltd 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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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 S2 Resources Ltd
Investment in Research and Development is below the fastest growing players in the industry. Even though S2 Resources Ltd 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.
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 S2 Resources Ltd 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.
Not highly successful at integrating firms with different work culture. As mentioned earlier even though S2 Resources Ltd is successful at integrating small companies it has its share of failure to merge firms that have different work culture.
Need more investment in new technologies. Given the scale of expansion and different geographies the company is planning to expand into, S2 Resources 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.
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. S2 Resources Ltd has to build internal feedback mechanism directly from sales team on ground to counter these challenges.

Opportunities for S2 Resources Ltd – External Strategic Factors

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Government green drive also opens an opportunity for procurement of S2 Resources Ltd products by the state as well as federal government contractors.
The new technology provides an opportunity to S2 Resources Ltd 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.
New trends in the consumer behavior can open up new market for the S2 Resources Ltd . It provides a great opportunity for the organization to build new revenue streams and diversify into new product categories too.
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 S2 Resources 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 S2 Resources Ltd to increase its competitiveness compare to the other competitors.
The new taxation policy can significantly impact the way of doing business and can open new opportunity for established players such as S2 Resources Ltd to increase its profitability.
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 S2 Resources Ltd to drive home its advantage in new technology and gain market share in the new product category.
Decreasing cost of transportation because of lower shipping prices can also bring down the cost of S2 Resources 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.

Threats S2 Resources Ltd Facing - External Strategic Factors

New technologies developed by the competitor or market disruptor could be a serious threat to the industry in medium to long term future.
Growing strengths of local distributors also presents a threat in some markets as the competition is paying higher margins to the local distributors.
Rising raw material can pose a threat to the S2 Resources Ltd profitability.
Liability laws in different countries are different and S2 Resources Ltd may be exposed to various liability claims given change in policies in those markets.
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.
Imitation of the counterfeit and low quality product is also a threat to S2 Resources Ltd’s product especially in the emerging markets and low income markets.
The company can face lawsuits in various markets given - different laws and continuous fluctuations regarding product standards in those markets.
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.

Limitations of SWOT Analysis for S2 Resources 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 S2 Resources 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 S2 Resources 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 S2 Resources 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 S2 Resources 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

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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)