Nextenergy Solar Fund Limited SWOT Analysis / Matrix

Business Essays, Term Papers & Research Papers

SWOT analysis is a vital strategic planning tool that can be used by Nextenergy Solar Fund Limited managers to do a situational analysis of the company . It is an important technique to analyze the present Strengths (S), Weakness (W), Opportunities (O) & Threats (T) Nextenergy Solar Fund Limited is facing in its current business environment.

The Nextenergy Solar Fund Limited is one of the leading organizatations in its industry. Nextenergy Solar Fund Limited 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 company such as – marketing, finance, operations, management information systems and strategic planning.


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The SWOT Analysis framework enables 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 helps the managers of the Nextenergy Solar Fund Limited 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 utilize to exploit external opportunities, counter threats, and build on & protect Nextenergy Solar Fund Limited strengths, and eradicate its weaknesses.

Step by Step Guide to Nextenergy Solar Fund Limited SWOT Analysis

Strengths of Nextenergy Solar Fund Limited – Internal Strategic Factors

As one of the leading companies in its industry, Nextenergy Solar Fund Limited 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 Nextenergy Solar Fund Limited are –

Read - Nextenergy Solar Fund Limited Porter 5 Forces Analysis & Industry Analysis
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• Superb Performance in New Markets – Nextenergy Solar Fund Limited 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.
• Highly successful at Go To Market strategies for its products.
• Automation of activities brought consistency of quality to Nextenergy Solar Fund Limited 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.
• 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.
• Highly skilled workforce through successful training and learning programs. Nextenergy Solar Fund Limited 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.
• Good Returns on Capital Expenditure – Nextenergy Solar Fund Limited is relatively successful at execution of new projects and generated good returns on capital expenditure by building new revenue streams.
• 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.

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Weakness of Nextenergy Solar Fund Limited – Internal Strategic Factors

Weakness are the areas where Nextenergy Solar Fund Limited 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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• The profitability ratio and Net Contribution % of Nextenergy Solar Fund Limited are below the industry average.
• High attrition rate in work force – compare to other organizations in the industry Nextenergy Solar Fund Limited 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 Nextenergy Solar Fund Limited is successful at integrating small companies it has its share of failure to merge firms that have different work culture.
• Investment in Research and Development is below the fastest growing players in the industry. Even though Nextenergy Solar Fund Limited 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.
• 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.
• 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. Nextenergy Solar Fund Limited has to build internal feedback mechanism directly from sales team on ground to counter these challenges.
• 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 Nextenergy Solar Fund Limited is not very good at demand forecasting thus end up keeping higher inventory both in-house and in channel.

Opportunities for Nextenergy Solar Fund Limited – External Strategic Factors

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• 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 Nextenergy Solar Fund Limited 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 Nextenergy Solar Fund Limited to capture new customers and increase its market share.
• The new technology provides an opportunity to Nextenergy Solar Fund Limited 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.
• The market development will lead to dilution of competitor’s advantage and enable Nextenergy Solar Fund Limited 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 Nextenergy Solar Fund Limited.
• 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 Nextenergy Solar Fund Limited 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 Nextenergy Solar Fund Limited products by the state as well as federal government contractors.
• Opening up of new markets because of government agreement – the adoption of new technology standard and government free trade agreement has provided Nextenergy Solar Fund Limited an opportunity to enter a new emerging market.

Threats Nextenergy Solar Fund Limited 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.
• Growing strengths of local distributors also presents a threat in some markets as the competition is paying higher margins to the local distributors.
• Rising pay level especially movements such as $15 an hour and increasing prices in the China can lead to serious pressure on profitability of Nextenergy Solar Fund Limited
• New technologies developed by the competitor or market disruptor could be a serious threat to the industry in medium to long term future.
• 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.
• 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.

Limitations of SWOT Analysis for Nextenergy Solar Fund Limited

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 Nextenergy Solar Fund Limited
• 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 Nextenergy Solar Fund Limited

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 Nextenergy Solar Fund Limited 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 Nextenergy Solar Fund Limited

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

You can email us to get an example document of Weighted SWOT analysis.

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)