Downing Strategic Micro-Cap Investment Trust Plc SWOT Analysis / Matrix

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SWOT analysis is a vital strategic planning tool that can be used by Downing Strategic Micro-Cap Investment Trust Plc 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) Downing Strategic Micro-Cap Investment Trust Plc is facing in its current business environment.

The Downing Strategic Micro-Cap Investment Trust Plc is one of the leading firms in its industry. Downing Strategic Micro-Cap Investment Trust Plc maintains its dominant 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 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 enables the managers of the Downing Strategic Micro-Cap Investment Trust Plc 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 use to exploit external opportunities, counter threats, and build on & protect Downing Strategic Micro-Cap Investment Trust Plc strengths, and eradicate its weaknesses.

Step by Step Guide to Downing Strategic Micro-Cap Investment Trust Plc SWOT Analysis

Strengths of Downing Strategic Micro-Cap Investment Trust Plc – Internal Strategic Factors

As one of the leading companies in its industry, Downing Strategic Micro-Cap Investment Trust Plc 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 Downing Strategic Micro-Cap Investment Trust Plc are –

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• Strong Free Cash Flow – Downing Strategic Micro-Cap Investment Trust Plc has strong free cash flows that provide resources in the hand of the company to expand into new projects.
• 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.
• 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.
• Reliable suppliers – It has a strong base of reliable supplier of raw material thus enabling the company to overcome any supply chain bottlenecks.
• Successful track record of developing new products – product innovation.
• Highly skilled workforce through successful training and learning programs. Downing Strategic Micro-Cap Investment Trust Plc 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.
• Strong distribution network – Over the years Downing Strategic Micro-Cap Investment Trust Plc has built a reliable distribution network that can reach majority of its potential market.
• Good Returns on Capital Expenditure – Downing Strategic Micro-Cap Investment Trust Plc is relatively successful at execution of new projects and generated good returns on capital expenditure by building new revenue streams.

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Weakness of Downing Strategic Micro-Cap Investment Trust Plc – Internal Strategic Factors

Weakness are the areas where Downing Strategic Micro-Cap Investment Trust Plc 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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• High attrition rate in work force – compare to other organizations in the industry Downing Strategic Micro-Cap Investment Trust Plc has a higher attrition rate and have to spend a lot more compare to its competitors on training and development of its employees.
• Investment in Research and Development is below the fastest growing players in the industry. Even though Downing Strategic Micro-Cap Investment Trust Plc 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.
• 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 Downing Strategic Micro-Cap Investment Trust Plc
• 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.
• Limited success outside core business – Even though Downing Strategic Micro-Cap Investment Trust Plc is one of the leading organizations in its industry it has faced challenges in moving to other product segments with its present culture.
• 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 Downing Strategic Micro-Cap Investment Trust Plc is not very good at demand forecasting thus end up keeping higher inventory both in-house and in channel.
• The profitability ratio and Net Contribution % of Downing Strategic Micro-Cap Investment Trust Plc are below the industry average.

Opportunities for Downing Strategic Micro-Cap Investment Trust Plc – External Strategic Factors

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• Decreasing cost of transportation because of lower shipping prices can also bring down the cost of Downing Strategic Micro-Cap Investment Trust Plc’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.
• 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.
• Government green drive also opens an opportunity for procurement of Downing Strategic Micro-Cap Investment Trust Plc 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 Downing Strategic Micro-Cap Investment Trust Plc to increase its profitability.
• 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 Downing Strategic Micro-Cap Investment Trust Plc 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 Downing Strategic Micro-Cap Investment Trust Plc 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 Downing Strategic Micro-Cap Investment Trust Plc. 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 Downing Strategic Micro-Cap Investment Trust Plc to increase its competitiveness compare to the other competitors.

Threats Downing Strategic Micro-Cap Investment Trust Plc Facing - External Strategic Factors

• 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.
• New environment regulations under Paris agreement (2016) could be a threat to certain existing product categories .
• 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.
• The company can face lawsuits in various markets given - different laws and continuous fluctuations regarding product standards in those markets.
• Rising raw material can pose a threat to the Downing Strategic Micro-Cap Investment Trust Plc profitability.
• Liability laws in different countries are different and Downing Strategic Micro-Cap Investment Trust Plc may be exposed to various liability claims given change in policies in those markets.
• Changing consumer buying behavior from online channel could be a threat to the existing physical infrastructure driven supply chain model.
• 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 Downing Strategic Micro-Cap Investment Trust Plc

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 Downing Strategic Micro-Cap Investment Trust Plc
• 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 Downing Strategic Micro-Cap Investment Trust Plc

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 Downing Strategic Micro-Cap Investment Trust Plc 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 Downing Strategic Micro-Cap Investment Trust Plc

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)