Chesapeake Energy Corporation SWOT Analysis / Matrix

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

The Chesapeake Energy Corporation is one of the leading organizatations in its industry. Chesapeake Energy Corporation 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 firm 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 called SWOT Matrix.

The Strengths-Weaknesses-Opportunities-Threats (SWOT) Analysis / Matrix enables the managers of the Chesapeake Energy Corporation to develop four types of strategies:

  • SO (strengths-opportunities) Strategies
  • WO (weaknesses-opportunities) Strategies
  • ST (strengths-threats) Strategies
  •  WT (weaknesses-threats) Strategies
Chesapeake Energy Corporation swot analysis / matrix

SWOT Matrix Strategies Objective

The core purpose of SWOT matrix is to identify the strategies that a company can utilize to exploit external opportunities, counter threats, and build on & protect Chesapeake Energy Corporation strengths, and eradicate its weaknesses.

Step by Step Guide to Chesapeake Energy Corporation SWOT Analysis

Strengths of Chesapeake Energy Corporation – Internal Strategic Factors


As one of the leading organizations in its industry, Chesapeake Energy Corporation 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 Chesapeake Energy Corporation are –


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  • Good Returns on Capital Expenditure – Chesapeake Energy Corporation is relatively successful at execution of new projects and generated good returns on capital expenditure by building new revenue streams.
  • Automation of activities brought consistency of quality to Chesapeake Energy Corporation products and has enabled the company to scale up and scale down based on the demand conditions in the market.
  • Strong distribution network – Over the years Chesapeake Energy Corporation has built a reliable distribution network that can reach majority of its potential market.
  • Strong Free Cash Flow – Chesapeake Energy Corporation has strong free cash flows that provide resources in the hand of the company to expand into new projects.
  • Highly skilled workforce through successful training and learning programs. Chesapeake Energy Corporation 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.
  • 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.
  • Superb Performance in New Markets – Chesapeake Energy Corporation 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.


Weakness of Chesapeake Energy Corporation – Internal Strategic Factors


Weakness are the areas where Chesapeake Energy Corporation 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.
  • 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.
  • High attrition rate in work force – compare to other organizations in the industry Chesapeake Energy Corporation has a higher attrition rate and have to spend a lot more compare to its competitors on training and development of its employees.
  • 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. Chesapeake Energy Corporation has to build internal feedback mechanism directly from sales team on ground to counter these challenges.
  • Limited success outside core business – Even though Chesapeake Energy Corporation is one of the leading organizations in its industry it has faced challenges in moving to other product segments with its present culture.
  • Not highly successful at integrating firms with different work culture. As mentioned earlier even though Chesapeake Energy Corporation is successful at integrating small companies it has its share of failure to merge firms that have different work culture.
  • The profitability ratio and Net Contribution % of Chesapeake Energy Corporation are below the industry average.

Opportunities for Chesapeake Energy Corporation – External Strategic Factors


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  • Lower inflation rate – The low inflation rate bring more stability in the market, enable credit at lower interest rate to the customers of Chesapeake Energy Corporation.
  • 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 Chesapeake Energy Corporation in other product categories.
  • Decreasing cost of transportation because of lower shipping prices can also bring down the cost of Chesapeake Energy Corporation’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.
  • Opening up of new markets because of government agreement – the adoption of new technology standard and government free trade agreement has provided Chesapeake Energy Corporation an opportunity to enter a new emerging market.
  • 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 Chesapeake Energy Corporation to drive home its advantage in new technology and gain market share in the new product category.
  • New trends in the consumer behavior can open up new market for the Chesapeake Energy Corporation . It provides a great opportunity for the organization to build new revenue streams and diversify into new product categories too.
  • 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.
  • The new technology provides an opportunity to Chesapeake Energy Corporation 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.

Threats Chesapeake Energy Corporation 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.
  • Changing consumer buying behavior from online channel could be a threat to the existing physical infrastructure driven supply chain model.
  • Rising pay level especially movements such as $15 an hour and increasing prices in the China can lead to serious pressure on profitability of Chesapeake Energy Corporation
  • Growing strengths of local distributors also presents a threat in some markets as the competition is paying higher margins to the local distributors.
  • Shortage of skilled workforce in certain global market represents a threat to steady growth of profits for Chesapeake Energy Corporation   in those markets.
  • The company can face lawsuits in various markets given - different laws and continuous fluctuations regarding product standards in those markets.
  • Liability laws in different countries are different and Chesapeake Energy Corporation may be exposed to various liability claims given change in policies in those markets.
  • New technologies developed by the competitor or market disruptor could be a serious threat to the industry in medium to long term future.

Limitations of SWOT Analysis for Chesapeake Energy Corporation

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 Chesapeake Energy Corporation
  • 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 Chesapeake Energy Corporation

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 Chesapeake Energy Corporation 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 Chesapeake Energy Corporation

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)