Kogan.Com Ltd SWOT Analysis / Matrix

Business Essays, Term Papers & Research Papers

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

The Kogan.Com Ltd is one of the leading firms in its industry. Kogan.Com Ltd maintains its prominent position in market by carefully 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 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 known as SWOT Matrix.

The Strengths-Weaknesses-Opportunities-Threats (SWOT) Analysis / Matrix enables the managers of the Kogan.Com 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 a company can use to exploit external opportunities, counter threats, and build on & protect Kogan.Com Ltd strengths, and eradicate its weaknesses.

Step by Step Guide to Kogan.Com Ltd SWOT Analysis

Strengths of Kogan.Com Ltd – Internal Strategic Factors

As one of the leading firms in its industry, Kogan.Com 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 Kogan.Com Ltd are –

Read - Kogan.Com Ltd Porter 5 Forces Analysis & Industry Analysis
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Highly skilled workforce through successful training and learning programs. Kogan.Com Ltd 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.
Superb Performance in New Markets – Kogan.Com Ltd 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.
Strong distribution network – Over the years Kogan.Com Ltd has built a reliable distribution network that can reach majority of its potential market.
Successful track record of developing new products – product innovation.
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.
Automation of activities brought consistency of quality to Kogan.Com Ltd products and has enabled the company to scale up and scale down based on the demand conditions in the market.
Reliable suppliers – It has a strong base of reliable supplier of raw material thus enabling the company to overcome any supply chain bottlenecks.
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.

Weakness of Kogan.Com Ltd – Internal Strategic Factors

Weakness are the areas where Kogan.Com 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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Organization structure is only compatible with present business model thus limiting expansion in adjacent product segments.
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. Kogan.Com Ltd has to build internal feedback mechanism directly from sales team on ground to counter these challenges.
Investment in Research and Development is below the fastest growing players in the industry. Even though Kogan.Com 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.
High attrition rate in work force – compare to other organizations in the industry Kogan.Com Ltd 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, Kogan.Com 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.
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 Kogan.Com Ltd
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.

Opportunities for Kogan.Com Ltd – External Strategic Factors

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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 Kogan.Com 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.
Lower inflation rate – The low inflation rate bring more stability in the market, enable credit at lower interest rate to the customers of Kogan.Com Ltd.
The market development will lead to dilution of competitor’s advantage and enable Kogan.Com Ltd to increase its competitiveness compare to the other competitors.
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 Kogan.Com Ltd to drive home its advantage in new technology and gain market share in the new product category.
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 Kogan.Com Ltd in other product categories.
Opening up of new markets because of government agreement – the adoption of new technology standard and government free trade agreement has provided Kogan.Com Ltd an opportunity to enter a new emerging market.
The new technology provides an opportunity to Kogan.Com 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.
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.

Threats Kogan.Com Ltd Facing - External Strategic Factors

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.
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 Kogan.Com Ltd
New technologies developed by the competitor or market disruptor could be a serious threat to the industry in medium to long term future.
Shortage of skilled workforce in certain global market represents a threat to steady growth of profits for Kogan.Com Ltd 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.
Growing strengths of local distributors also presents a threat in some markets as the competition is paying higher margins to the local distributors.

Limitations of SWOT Analysis for Kogan.Com 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 Kogan.Com 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 Kogan.Com 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 Kogan.Com 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 Kogan.Com 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)