Chapter 3-

SWOC Analysis
What is SWOC Analysis?

SWOC analysis is a strategic planning method used to research external and internal factors
which affect company’s success and growth. Firms use SWOC analysis to determine
the strengths, weaknesses, opportunities, and challenges of their firm, products, and competition.

SWOC analysis is relevant to SWOT analysis. SWOT examines strengths, weaknesses, and
opportunities. But it focuses on threats rather than challenges. The two are similar but they do
have their differences, which is why firms may choose to use SWOC or SWOT

How to use SWOC analysis:

When beginning a SWOC analysis of a product or firm, you must go through each section
individually. Starting with…

 Strengths:

Strengths are features which benefit the company, such as product sales. For example, sale of
Product X is growing 3% each month. But Product Z is seeing a 3% monthly decline. In this
case, Product X, which brings in more revenue, is where the firm should focus their efforts to
continue profit growth.

Strengths can also be more abstract. If you’ve decided to build a product because you know you
can offer it cheaper than your competitor, this is an overall strength of the company. Or if you
have records of better customer service via positive reviews online, this is a strength you can use
to your advantage. Strengths can be documented through statistics, customer service reviews,
and surveys.

 Weaknesses:

The next step is noticing weaknesses. Weaknesses cause a company to struggle. For example, if
you’ve decided to target a younger audience but your packaging is still dedicated to senior

23
citizens, the new consumer base will struggle to connect to the product. This will show in
reports, and cause an internal struggle within the company.

Weaknesses need to be documented and acknowledged to handle them promptly before it

 Opportunities:

Opportunities are often external. They provide ways for firms to grow successfully. For example,
a digital marketing agency helps a client develop an effective email marketing strategy. The
agency has been thinking of doing graphic design so they offer a reduced fee to re-do the
existing client’s logo. This is an opportunity for the agency to develop a new section of their
business without having to devise a marketing plan because they can reach out to existing clients.

Being open to opportunities, knowing when to look for them, and how to act on them can boost a
firm’s success. Documenting past opportunities can help create a plan on how to capitalize future
opportunities.

 Challenges:

The final step in SWOC analysis is acknowledging challenges. This is how SWOC and SWOT
analysis differ because SWOT analysis focuses on threats.

Challenges are similar to threats but have the chance of being overcome. Threats have the
potential to damage a firm, but challenges often already exist and need to be handled
appropriately.

This step is crucial. If you’ve already examined the strengths, weaknesses, and opportunities but
skip assessing challenges, you may be on the path to failure. Challenges can greatly undermine
any progress you’ve made, so by ignoring this step, you’ve opened yourself up to potential
failure.

24
When to use SWOC analysis:

SWOC analysis is to be used whenever one has a business idea. Whether it’s starting a brand
new business, a product, or a product upgrade. SWOC analysis can be done annually, quarterly,
or monthly; it depends on what product or idea one is using the SWOC analysis for.

But if one chooses to do SWOC analysis, it must be remembered that it’s a great cost-effective
way to reduce challenges and deter failure of a business venture or product.

SWOC Analysis of TCS:

SWOC Analysis of TCS focuses on Strengths, weaknesses, opportunities, and challenges.

Tata Consultancy Services is one of the prominent business conglomerates in India, and is
considered a part of the group of “Tata group”. The core business of TCS also consists of
providing IT services, consultancy, and business solutions. In Asia-Pacific, Africa, Middle East,
Europe, and America, TCS operates in America. The total Revenue of TCS in the year 2020 was
23 Billion US Dollars. The total number of employees in TCs is 469261 as of December 2020.

25
Strengths in the SWOC Analysis of TCS:

1) Huge Customer Base:

TCS serves clients in a variety of industries, including banking, financial services, retail,
telecommunications, and media and entertainment. Exposure to diverse businesses dilutes the
risks of a single market or industry’s over-dependence. TCS is also serving the Government of
India for Passport services.

2) Global Footprints:

TCS’s presence across various markets in which the company has attempted to gain as much
coverage as possible is its global footprint, which now stretches from North America, UK,
Africa, Europe, and the Asia-Pacific regions. A presence in diversified geographical areas
reduces corporate risk and provides TCS with a strong global image.

3) Strategic Partnership:

TCS established a strong partnership around the world with global enterprises. It worked with
certain technological giants like Amazon, Adobe, Dell, Bosch, HP, etc. TCS offers both
technologically sustainable and innovative business and strategic solutions through these
partnerships.

4) Strong Service Portfolio:

26
TCS offers a strong and balanced service portfolio, which includes: application development and
maintenance of Business Process Services (BPS), IT infrastructures, business intelligence, and
more. Various business customers attract such a strong and diverse portfolio.

5) Good Returns on Capital Expenditure:

TCS is relatively successful at the execution of new projects and generated good returns on
capital expenditure by building new revenue streams.

6) Highly skilled workforce through successful training and learning programs:

TCS is investing huge resources in the training and development of its employees resulting in a
workforce that is not only highly skilled but also motivated to achieve more

Weaknesses in the SWOC Analysis of TCS:

1) Legal Judgements:

TCS engaged in a 2014 legal battle for alleged misuse of confidential information by Epic
System against Epic Systems. In 2016, TCS was found to have been found guilty and charged
$940 million in damages. TCS opposed and rejected the judgement by the higher competence.
Such events influence the company’s image.

2) Diligent decrease in performance:

27
The TCS subsidiary Diligenta continuously operated below par. The enterprise is unlikely to
improve performance quickly and therefore affect the bottom line of TCS.

Opportunities in the SWOC Analysis of TCS:

1) Digital Transformation:

The world is digital and thus business dynamics are transforming the digital economy. The focus
of TCS is to transform itself digitally and offer digital solutions. TCS should look forward to
more spending on technology for digital transformation.

2) Increasing Demand for Cloud-Based Computing:

Digital technology and fast internet connectivity have emerged. In fact, in the next 5 years,
expenditure on cloud services will increase in the next 19% in CAGR. The world is progressing

28
toward cloud solutions. TCS has a strong cloud-based infrastructure, and is; therefore, ready to
benefit from the generated requirement.

3) Solutions from machine to machine (M2M):

M2M solutions enable both wireless and wired communications systems. For M2M solutions,
there are positive prospects in the future, and revenues are expected to be high. TCS has a
complete range of M2M services that enable the demand for M2M solutions to be taken
advantage of.

4) Mobility Solutions:

Enterprise mobility solutions are expected to be driven by business applications with a growing
mobile worker population and the increasing use of sophisticated mobile devices. The demand
for mobility solutions is latent and is projected to increase by 24.7 percent in a CAGR until 2022.
TCS is well-positioned to benefit from its growing focus on the development of enterprise
mobility solutions.

Challenges in the SWOC Analysis of TCS:

1) Immigration and its Limitations:

29
Indian IT companies are expected to suffer as they increase their cost and impact profitability,
and therefore pose a risk to the industry with immigration rules, increased H-1B visa fees, and
changing political circumstances in the US.

2) Intense competition:

IT companies such as Infosys, Wipro, Capgemini, Deloitte, Accenture, etc are faced with heavy
competition. The result is price wars in the sector and the market share is limited.

3) High Attrition rate:

The Indian IT industry undergoes a high rate of attrition, which increases costs to provide new
employees with skills and leadership development and also affects the company’s image.

30