AndrewsCorporation SWOT Analysis
AndrewsCorporation SWOT Analysis
Headquarteredin Westchester Illinois in the United States, Andrew Corporation is aworld leading company that designs, manufactures, and distributescommunication systems and products to wireless subsystem marketplaces(, 2008). Andrew functions usingfive segments: Base Station Subsystems, Wireless Innovations, Cableand Antenna Products, Satellite Communications, and NetworkSolutions. Its products include power amplifiers, duplexers,terrestrial microwave and base station antennas, connectors, cableaccessories and assemblies, coaxial cables combiners, and filters. Toenhance their performance, Commscope acquired Andrews, which enabledthem to establish products and services that connect technology andpeople with every evolution (,2008). Therefore, their goal is to aid their customers establish,design, innovate, and build promptly and better. With this, AndrewsCorporation continues to build on their core competencies thatinclude their customer orientations, global presence, and productportfolio among others.
Itis necessary for Andrews to perform a SWOT (Strength, Weakness,Opportunity, and Threat) analysis that will provide them with anextensive analysis of both their extrinsic and intrinsic environment(Ahmadi, Dileepan, & Wheatley, 2016).
AndrewsCorporation has a number of strengths that has ensured thesustainability and a higher competitive advantage of the company.Firstly, in December 2007, CommScope managed to acquire AndrewsCorporation (, 2008). The newcombined company became an international leader in the field ofinfrastructure solutions associated with the communications network.Moreover, it records net profits of 13485 billion dollars compared toDigby’s 3874 billion dollars due to its acquired financialstructure (Capstone Courier Round 4, 2016). Therefore, Andrewsleveraged on CommScope’s brand values to improve theirprofitability and performance.
Additionally,Andrews has a low variable costs compared to to Digby’sCorporation. Maintaining low variable costs is one of the strengthsthat the company has over its competitors. In round 1 of theanalysis, Andrews Corporation had a variable cost of $ 76758783whereas Digby Corporation had $ 75600392.However, in the subsequentyears, the statistics indicate that, Andrews Corporation had a lowervariable costs compared to Digyb. To illustrate, $67,115,766and $109,149,375in round2of the analysis,$55,066,279and $99,634,775 in round 3,$42,545,489and $75,038,499 in round 4, $28,624,658 and $100,227,714 in round 5,$33,272,772and $89,635,786 in round 6, $18,110,238 and $119,160,221 in round 7for Andrews and Digby Corporations respectively. Variable costsinclude costs such as direct labor costs and material costs.Therefore, a company with low variable costs such as AndrewCorporation in this particular case is an indication that it isminimizing on the costs incurred in both labor and purchase ofmaterials. This is very essential since it results to increasedprofits giving the company a higher competitive advantage compared toDigby Corporation (CapstoneCourier Round Analysis, 2016).
AndrewsCorporation also exhibits some weaknesses that need address. Thecompany has a huge capacity of over 5000 units to carry out theirbusiness but only manage to have below 1000 unit productions whencompared to Digby’s 6000-unit capacity and above 5000 unitproduction (Capstone Courier Round 4, 2016). Therefore, it is evidentthat Andrews is not capitalizing on all its assets making itdifficult for it to compete in the already concentrated market.Additionally, the sales at Andrews are dependent on theirrelationship with their core customers. Therefore, thesecustomer-company relationship decreases, its overall sales and hencerevenues will decline significantly.
Further,Andrews Corporation only allocates ten hours of training to itsemployees when compared to Digby’s sixty hours (Capstone CourierRound Analysis, 2016). Due to this, their employees do not have theexceptional training needed to ensure the overall success of thecompany. Therefore, the employees from competitive companies have theability to cope highly with any modifications in the business marketsince they are well equipped. Also, Andrews’s employee turnoverrate is higher compared to that Digby. In round one of the analysis,both companies had similar turnover rate. Nevertheless the turnoverfor the two companies in the subsequent years are as follows, 8.50%and 10.01%in round 2, 8.50%and 7.76% in round 3, 9.63% and 7.75% in 4, 12.61% and 7.76% in round5, 12.06% and 7.75% in round 6, 12.28% and 7.73% in round 7 forAndrews and Digby Corporations respectively. A high employee turnovermakes it difficult for the company to retain customers. Apart fromthat, a high employee turnover tends to lower their productivityhence negatively affecting the output and general productivity.Therefore, from the analysis it is clear that a high employeeturnover is a weakness to the Andrews Corporation.(Capstone Courier Round Analysis, 2016). Therefore, the conditions ofworking at Andrews are not satisfactory to most employees since theyhave a tendency of moving on to better organizations. Equallyimportant, Andrews Corporation weaknesses are reflected in its assetturn over. Ordinarily, the asset turnover of a company is anindication of how the company ‘is using its available assets togenerate sales. With reference to the selected Industry C80289selected statistics, its only in round 1 where Andrews Corporationrecorded a higher asset turnover of 1.07 compared to its competitorDigby Corporation which had an asset turnover of 0.97.However,Andrews Corporation recorded an asset turnover of 0.9 while Digby had1.1 in analysis round 2.In addition to that, the following assetturnovers were recorded in the subsequent years, 0.67 and 1.01 inround 3, 0.45 and 0.7 in round 4, 0.32 and 0.98 in round 5, 0.68 and0.96 in round 6 as well as 0.61 and 1.13 in round 7 for Andrews andDigby Corporations respective. From the analysis, it is evident thatDigby Corporation has a higher asset turnover compared Andrews. Thisimplies that Andrews Corporation is either having both production andmanagement problems or the company is not maximizing the use of itsassets to generate sales. A low asset turnover is one of theweaknesses that the management of Andrews Corporation has to work onso that it can offer a stiff competition to other corporations suchas Digby (Capstone Courier Round Analysis, 2016).
AndrewsCorporation is has opportunities that range from increased cablemarkets to the increased international wireless market. Currently,the world’s technologies are changing making demand for cable togrow. Therefore, they have can grow everywhere across the globe toensure that they meet consumer demands. The corporation’s solidpresence within the cable market offers important opportunitiesrequired to enhance its top line development. Further, the wirelessinfrastructure sources and network development include higher dataapplication utilization, amplified usage minutes, and the growingwireless subscribers. Due to this, it is evident that through theirstrategic positioning within their markets, Andrews can exploit theincreased demand for wireless products globally boosting their salessignificantly. Besides, a company that allows its employees to workfor more extra hours apart from their normal working hours is likelyto generate more profits compared to its competitors. From theanalysis, it is clear that Andrews Corporation recorded the highestthe highest number of hours worked on overtime. For instance, thecompany had 22.49%in round six while Digby had 0.00%.Similarly, the company recorded24.64% of overtime in round 7 compared to Digby’s 0.00%.This is aclear indication of the opportunities that Andrews Corporation hasover its closest competitors.
Whenoperating in any particular business environment, companies are boundto face some sort of competition. Therefore, Andrews operates in ahighly competitive market posing threats to the business sales andrevenue. In their line of business, Andrews Company only has a lowermarket share compared to Digby. In round one of the analysis, AndrewCompany recorded a market share of 16.06%which was higher compared to Digby’s 15.86%. In round 2, bothcompanies had the same overall market share of 12.04%.However,in the subsequent rounds, Andrews Corporation recorded a lower marketshare as illustrated.8.85%and 17.17% in round 3, 6.37% and 11.43% in round 4, 3.17% and 15.76%In round 5,3.59%and 12.55% in round 6, 1.88% and 16.42% in round 7 for Andrews andDigby Corporation. The lower market share for Andrews Corporation isa threat to the company since it limits its operations and theability to generate more profits (CapstoneCourier Round 4, 2016). Due to this, it is true to note that Andrewsis lagging behind in their attempt to capture a significant portionof the market, which can greatly affect their sales.
Itis apparent that by understanding the SWOT analysis of their company,Andrews can make the necessary changes to gain maximum profits intheir operations. It should maximize on its strengths to gain ahigher competitive advantage compared to other companies. Also, theSWOT analysis will enable the company identify its weak areas andcome up with appropriate strategies to improve on the same. From theanalysis, Andrews Corporation might make sales that rage betweenseventy and eighty million dollars increasing their profitability by13.6% to 15.5%.
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