Computech IT Services 1

Running Head: SWOTT ANALYSIS FOR COMPUTECH IT SERVICES

SWOTT analysis for Computech IT Services

Michael Magliotti

University of Phoenix

Instructor: Michael Mc Quinn

BUS/475

December 15, 2009

Introduction

SWOTT analysis is a critical process of evaluating all the dimensions of the market that are important for the company business (Pierce & Robinson, 2004).SWOTT analysis is a crucial tool that is employed by the organization in assessing the strategic position of the company in terms of the market share, competitive positioning and profitability (Stahl & Grigsby, 1997). With the help of SWOTT analysis, the company can gain an in-sight about the strengths, weaknesses, opportunities, threats and trends. SWOTT analysis is the helpful tool that can leverage the lucrative opportunities existed in the marketplace (Wheelan & Hunger, 2004). This is the internal as well as external appraisal of the company in which all the pertinent aspects are covered (Stahl & Grigsby, 1997).

This synopsis is based on the evaluation of environmental factors of the business of Computech. With the help of this report, the management can evaluate the factors related to the long term profitability and various obstacles in the success of organization (Wilson & Gilligan, 2005).

External Environmental Analysis

The external environmental analysis will comprise legal and regulatory factors, economical factors, technological factors and innovative factors for the business of Computech (Wilson & Gilligan, 2005).

Economic Factors: The economic factors show the present and future growth of the organization as per the economic environment of the business industry. High chances for the possibility of exceptional growth of the economic condition of the United States of America are one of the strong factors for the Computech firm (Global Strategic Trends: Global Perspectives, 2008). It is necessary for the management to evaluate this aspect because of the recession and market rate fluctuation, which ultimately gives a negative impact on the success of the business (Pierce & Robinson, 2004). With the help of this the firm also can identify various opportunities to deliver unexpected economic services and information to the clients in advance (Stahl & Grigsby, 1997). The business firm should access the competition within the industry and plan various strategies to cope up with the changes because these reflects both the increases and decreases trend due to the frequent economic changes (Brown, 2009).

Legal and Regulatory Factors: The main strengths of this external factor are the improvement in the potentiality of the company’s strategy formulation. In the IT services sector, the legal and regulatory framework provide security to the business firm that nobody can use the services of the business in an illegal and unauthorized manner (Wheelan & Hunger, 2004). The business firms should analyze these factors of the external environment because the legal and regulatory rules of this business industry are quite strict and inflexible (Wilson & Gilligan, 2005). This IT service firm can gain the opportunity of expanding the shares and attracting the large number of customer with the safe and secure legal practices (Pierce & Robinson, 2004). The evaluation of these factors would also help the firm to identify frequent alterations in the legal regulations, which would be harmful for the company and vice versa (Brown, 2009).

Technological Analysis: A wide ranges of services of Information technology would be strength of the IT service firm. Technological forces empower fast worldwide outgrowth and advancement for this proposed business (Wheelan & Hunger, 2004). It is highly recommended for the business firm to estimate the extent of technological factors because there is high risk of the technological error (Stahl & Grigsby, 1997).

The opportunity for the business firm in this area is fast growth of the new and innovative information technologies and sources and variety of software empower the business success in future (Wilson & Gilligan, 2005). The trend of using innovative services of information technology is also increased, which ultimately allow the firm to make a wide customer database (Pierce & Robinson, 2004). Thus, Computech should diagnosis all the strengths and weaknesses, opportunities and threats related to the technological factors in the external environment (Brown, 2009).

Innovative Factors: Due to the development of the innovative technologies in the field of information and communication, the IT business has a stable position in the international market (Global Strategic Trends: Global Perspectives, 2008). The utilization of all latest and innovative sources of IT, make the business reputation strengthen and powerful. The business management should also analyze the knowledge of its personnel about the operating system of these innovative technologies. If they have no sufficient knowledge and skills to use these technologies the company should implement training and development programs and appoint qualified personnel (Bradford & Duncan, 2000). The changes in the technological environment are a biggest threat for the smooth functioning of the IT firm (Kotler, 2002).

Internal Environmental Analysis

The internal forces and trends consider in this analysis for IT service business firm are strategy, structure, process/ system (Wheelan & Hunger, 2004).

Strategy: The business strategy for the business firm related to the IT services. Should be formulated in an effective and implementation of strategy is conceived as the platform for the business success (Demarie & Hitt, 2000). The formulation of strategies should be based on the available resources such as human, finance, marketing, research and development and directly link with the objectives of the IT firm (Global Strategic Trends: Global Perspectives, 2008). The business associates should evaluate the strategies of the firm because it needs huge capital investment, which would be a weakness of IT firm.

The company can gain the opportunities by developing diversified and growth strategy and create competitive advantages in industry (Demarie & Hitt, 2000). Risk of failure is high in IT service industry, if it does not look at all perspectives of the business like financial, human, growth, IT, etc., the firm will go in sunk (Global Strategic Trends: Global Perspectives, 2008). Efficacious formulation & implementation strategy contributes in competitive position, market share & growth, which is an increasing trend in internal environment of the IT service firm (Demarie & Hitt, 2000).

Structure: The organization structure of an IT service business organization should be well defined and all the departments are separated. A sound structure based on specialization induces creative thinking by furnishing well defined area of work with the provision of development of new and improved ways of working is the strengths of the company (Zhang, McCullough & Wei, 2004). The management should give proper consideration for the effective and smooth running of business organization (Wheelan & Hunger, 2004). If the organization structure is ineffective and unable to explain the roles and responsibilities of the employees, it will affect the growth of the company in a negative way (Zhang, McCullough & Wei, 2004). A proper and effective structure as per the services of the business, the management can monitor and control the various process and information of the organization within time limits and without wasting money (Wilson & Gilligan, 2005).

SystemsProcess: The systems of the IT business organization should be economical and effective to boost up the various process of business. This would be the biggest strength of the business firm (Pierce & Robinson, 2004). The weakness of the system and process is the requirement of high qualified and technical personnel. The company can develop a competitive advantage by using innovative systems and process within the industry and do some modifications as per the needs of the environment and development of innovative services (Stahl & Grigsby, 1997). On the other hand the company should also concentrate on the training and development process of the employee, so that they can gain sufficient knowledge about the process and systems of the IT organization (Brown, 2009).

Conclusion

On the basis of above discussion, it can be inferred that to remain in the market and sustain the market position as well as market share, it is crucial for the IT service company to perform SWOTT analysis (Wheelan & Hunger, 2004). To leverage the market opportunities offered by the increasing globalization, it is essential for the IT firm to adopt some specific tools & techniques that are required to handle the challenges posed by the competitors. It assists the company to deal with the competition existed in the market (Wilson & Gilligan, 2005). To attain the long term as well as short term goals of the company it is essential for the company to perform SWOTT analysis (Pierce & Robinson, 2004).

To carry out the SWOTT analysis successfully, it is essential for the company to apply some innovative tools & techniques in the practices (Stahl & Grigsby, 1997). SWOTT analysis can assist the company by providing a defined emphasis of what requirements to be handled to keep IT service firm prosperous, competitive and growing (Wilson & Gilligan, 2005).

References

Bradford & Duncan (2000). Simplified Strategic Planning (3rdEdition). New York: Chandler House.

Brown, S.P. (2009). Forces and Trends in Business. Retrieved December 12, 2009 from

Demarie, S.M. & Hitt, M.A.(2000, September). Strategic implications of the information age. Journal of Labor Research 3(21): 419-429

Global Strategic Trends: Global Perspectives (2008, October 30). Retrieved December 14, 2009 from

Kotler, P. (2002). Marketing Management (11th Edition). New York, USA: Prentice Hall Pvt. Ltd.

Pierce, J. & Robinson, R. (2004). Strategic Management (eds.). New York: McGraw Hill Companies.

Stahl, M.J. & Grigsby, D.W. (1997). Strategic Management: Total Quality and Global Competition (eds.). Blackwell Publishing.

Wheelan, T.L. & Hunger, J.D (2004). Strategic management and Business policy (eds.). Singapore: Pearson Education Pvt. Ltd.

Wilson, R.M.S. & Gilligan, C. (2005). Strategic Marketing Management: Planning, Implementation and Control (3rd Edition). Butterworth-Heinemann.

Zhang, M., McCullough, J. & Wei, R.Y. (2004, January). Effects of organizational structure and information technology capability on organizational effectiveness in emerging markets. Journal of the Academy of Business and Economics. Retrieved December 15, 2009 from

Appendix 1

SWOTT ANALYSIS TABLE

Factors / Strength / Weakness / Opportunity / Threat / Trend
External Factors
Economic / High chances for the possibility of exceptional growth / The periods of Recession and market rate fluctuations are the major weaknesses that will have to be faced by the business. / High opportunity to attain the renowned corporate name & fame through delivering all the unexpected economic information to their clients in advance. / Changes in the economic conditions. / It reflects both increasing & decreasing trend due to frequent economic changes.
Legal & Regulatory / This external force would improve the potentiality of the company’s strategy formulation & implementation with the inclusion of the wide-ranging legal and regulatory views of the different areas. / Strict legal and regulatory rules of the government / Attract large number of customers because, now, the users would be more aware about the legal aspects / Frequent alterations in the legal/ regulatory frameworks or rules. / It will become more rigid in the near future.
Technological Analysis / Technological forces empower fast worldwide outgrowth and advancement for this proposed business. / Risk of high technological errors / Quick growth of new IT technologies like machine-controlled software’s would empower the business to operate its purposes more accurately and rapidly. / High Competition / Increasing trend of more customized services
Innovative / Innovative services build the business reputation in market. / Due to lack of innovative knowledge, business is enabled to perform multi tasks. / Capture huge mass of customers through furnishing innovative services. / Changes in the technological environment and development of innovative technologies / Growing Trend
Internal Factors
Strategy / Effective formulation & implementation of strategy is conceived as the platform for the business success. / It requires huge capital investment / High changes to gain competitive advantage through beneficial strategy. / Risk of failure is high, if it does not look at all perspectives of the business like financial, human, growth, IT, etc. / Efficacious formulation & implementation strategy contributes in competitive position, market share & growth.
Structure / A sound structure based on specialization induces creative thinking by furnishing well defined area of work with the provision of development of new and improved ways of working. / Ineffective structure greatly affects the business growth, because it deals with all the contextual variables. / With a suitable structure, business can monitor and process information about business environment and also increases the ability to pre- plan. / If the crucial activities are overlooked as lowered; cause harm to the organization / More growth opportunities because it not only stimulates creativity, but also communicates, boosts up the efficiency, etc.
Systems/ Processes / Economical or effective systems and processes boost up the business process. / High requisite of capital and frequent training to the workforce. / Great chances to gain good image & competitive position. / High resistance to change by the staff members. / Growing trend because modifications in the system/process must be made according to the environment.