Fbd Holdings Plc SWOT Analysis / Matrix

Business Essays, Term Papers & Research Papers

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

The Fbd Holdings Plc is one of the leading companies in its industry. Fbd Holdings Plc maintains its dominant 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 organization 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 Fbd Holdings 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 central purpose of SWOT matrix is to identify the strategies that a firm can use to exploit external opportunities, counter threats, and build on & protect Fbd Holdings Plc strengths, and eradicate its weaknesses.

Step by Step Guide to Fbd Holdings Plc SWOT Analysis

Strengths of Fbd Holdings Plc – Internal Strategic Factors

As one of the leading firms in its industry, Fbd Holdings Plc 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 Fbd Holdings Plc are –

Read - Fbd Holdings Plc Porter 5 Forces Analysis & Industry Analysis
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Superb Performance in New Markets – Fbd Holdings Plc 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 Fbd Holdings Plc has built a reliable distribution network that can reach majority of its potential market.
Successful track record of developing new products – product innovation.
Highly skilled workforce through successful training and learning programs. Fbd Holdings 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 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.
Strong Free Cash Flow – Fbd Holdings Plc 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.

Weakness of Fbd Holdings Plc – Internal Strategic Factors

Weakness are the areas where Fbd Holdings 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 Fbd Holdings Plc has a higher attrition rate and have to spend a lot more compare to its competitors on training and development of its employees.
Limited success outside core business – Even though Fbd Holdings Plc is one of the leading organizations in its industry it has faced challenges in moving to other product segments with its present 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 Fbd Holdings Plc is not very good at demand forecasting thus end up keeping higher inventory both in-house and in channel.
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.
The profitability ratio and Net Contribution % of Fbd Holdings Plc are below the industry average.
Not highly successful at integrating firms with different work culture. As mentioned earlier even though Fbd Holdings Plc is successful at integrating small companies it has its share of failure to merge firms that have different work culture.

Opportunities for Fbd Holdings Plc – External Strategic Factors

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The market development will lead to dilution of competitor’s advantage and enable Fbd Holdings Plc to increase its competitiveness compare to the other competitors.
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 Fbd Holdings Plc products by the state as well as federal government contractors.
The new technology provides an opportunity to Fbd Holdings Plc 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.
Decreasing cost of transportation because of lower shipping prices can also bring down the cost of Fbd Holdings 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.
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 Fbd Holdings 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.
Opening up of new markets because of government agreement – the adoption of new technology standard and government free trade agreement has provided Fbd Holdings Plc 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 Fbd Holdings Plc in other product categories.

Threats Fbd Holdings Plc Facing - External Strategic Factors

Increasing trend toward isolationism in the American economy can lead to similar reaction from other government thus negatively impacting the international sales.
The company can face lawsuits in various markets given - different laws and continuous fluctuations regarding product standards 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.
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.
Rising raw material can pose a threat to the Fbd Holdings Plc profitability.
Growing strengths of local distributors also presents a threat in some markets as the competition is paying higher margins to the local distributors.
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.
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.

Limitations of SWOT Analysis for Fbd Holdings 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 Fbd Holdings 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 Fbd Holdings 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 Fbd Holdings 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 Fbd Holdings 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)