Introduction:
In India small and medium enterprises (SMEs) are facing a different scenario in comparison to the defensive atmosphere of the past since the economic reforms in 1991 (Singh, Garg and Deshmukh, 2006). The company models in India are changing constantly due to large-scale competition, advancements in technology and the varying requirements of customers. Therefore, in this competitive world, a leading firm is distinguished from other firms by energetic tactical performance with the factors of modernization, liaison management with market and suppliers, internationalization procedures, capability to systematize and manage business networks (Chiarvesio et al., 2004). This paper outlines the company profile of Skylabs (www.skylabstech.com), the issues such as the assets, limitations, pressures and the competitive priorities through a SWOT analysis of the company. At last, the paper shows some of the recommendations which may help the company to improve in the future.
Introduction to the Company:
Skylabs is an IT company which is providing enterprise wide software and Geographical Information System (GIS) solutions consisting of products and services and has a wide range of products such as core GIS products, industry vertical products (http://www.skylabstech.com/about_us.html).
Skylabs was started in March, 2009 and is owned by two persons namely Mr. Santosh Pandey and Mr. Pankaj Chandar with 18 major employees and the engineers who are hired on contract at times with its original name as “GeoIT Services Pvt. Limited.” It is based in the capital city of India and operates from an offshore set-up maintaining an offshore development company (ODC) status in order to present planned software development outsourcing services to its clients. Skylabs started the software outsourcing approach in India while keeping in mind the needs of its clients because of facilitating services and extending the resources in the country developing rapidly in the IT sector. And because the business outsourcing is now proved to be effective method overtime it is apparent that Skylabs is learning and moving with the competitive markets.
SWOT analysis of Skylabs:
The core business function of Skylabs is the prosperity of knowledge and skills in building world class software services to make certain that it deliver the value constantly. Skylabs make sure that the consumer understands the value of their investments all the way through the life-cycle of the project so it delivers custom projects in small proportions at rational costs. Let us now look at some of the strengths and weaknesses of Skylabs along with the opportunities it has and the threats it is facing from the outside world to grow in the market:
Strengths:
Skylabs involves highly skilled professionals working with
cultural ethos
to achieve the business objective. The other important asset of Skylabs is that it is an offshore software development company as mentioned earlier which gives it many benefits such as tax rebates, legal and asset protection, low fees charges from the local jurisdiction, anonymity, financial assistance and less cost of operations (Rajkumar and Mani, 2001). Skylabs also has an end-user sales control and direction for its clients which helps it deliver right products at the right time with high quality and reliability. It also enjoys the benefits of superior product performance as compared to the local competitors in the market. In order to deliver the right and durable end product to the customer Skylabs has experienced staff in different high end developments such as Microsoft .Net, Java J2EE platforms, UNIX, Linux and Windows user interfaces. This also helps Skylabs to reach the niche sector of global servicing. Skylabs also maintains organized database of its clients through the use of different data analysis and mining techniques so that it can provide its clients with quality solution.
The higher management in Skylabs is highly committed and confident as far as the process orientation in its operations is concerned and provides its staff with updating and leading software process management tools. This also helps Skylabs to develop new products and ideas, for example, real time traffic information system, police control room application system and ambulance dispatch system. Skylabs has already entered the foreign markets and has clients such as Dubai Technologies, Iris Cabs and it is trying to enter more export markets.
Weaknesses:
It is a small player in today’s big business industry which makes it difficult to compete with other big companies. Though it is a small company and does not has an organizational hierarchy there are some gaps in certain sectors such as decision making, higher level training for employees, etc. Skylabs also has limited financial budget which makes it less adaptable to the current changing technological trends and also there is no access to the consultancy services. Skylabs is more dependent on its suppliers and partners because it provides the service by integrating the solutions and there is no manufacturing of products. This sometimes results in low efficiency within the operations because if the engineers will not get the equipments and products in hand, there will be a delay in the solution design of end product. Skylabs, being a small and new company, is not aware of performance and growth plans of other global companies which is a major barrier in its growth.
Opportunities:
Although Skylabs have a lot of solutions to offer to its clients such as fleet management, taxi management, location management and GIS services there are many new opportunities of developing more new products due to the increasing customer demands and to compete to get ahead of local competitors which sell the same products at lower prices but have poor quality as well. The idea of getting the public demand as suggestions is always good, so Skylabs can ask for end-user responses and feedback in order to serve better. Skylabs can work on its core business strategies and get the best out of its suppliers in order to get good deals so that there should be high profits. As Indian economy is on a rise, Skylabs can make a lot from the emerging economy by expanding within India and other foreign markets which are developing such as Philippines, Vietnam, Sri Lanka, Bangladesh, etc.
SWOT ANALYSIS OF SKYLABS
Threats:
Firstly there is a tough price competition to the company from different existing firms in the same market as Skylabs is a new company. Its competitors have already gained a reputation and standing in the market so it is hard for Skylabs to get ahead. Secondly, due to the day-to-day changing needs of the customers it is difficult for Skylabs to cope with the advancements in technology. There may also be a risk of distribution of existing business it has a small infrastructure and financial resources are limited making it reluctant to look for distribution. Other external factors which affect the growth of Skylabs are the legislation in the existing nation and the slow growth in infrastructure to cope with the international standards such as the technological ability, reach of networks and communications and the government support (Timmers, 2000).
Recommendations:
On the basis of SWOT above, following are some of the top of the mind recommendations that may serve as a basis for this paper:
1.Specialized technology offering:
Given its limited financial resources and subsequently curtailed research spending, it may be prudent to look at the existing client base and demarcate solution sets contributing majority of the business. Basis this demarcation the firm can then use the learning’s from these client situations to further refine the solutions on offer. These refined solutions can be offered as pilot test cases to existing clients, thereby helping the firm specialize in a particular industry and solution space without substantial investment in research. These specialized solutions will go a long way in helping the firm overcome the threat from more established competitors through innovation and specialization to circumvent the price challenges in a crowded marketplace.
2.Technology tie-ups:
Skylabs may tie up with large and established consulting firms advising their prospective clients at the business setup stage. These tie-ups will provide much needed early mover advantage in terms of access to information on the projects in the pipeline at the design stage itself and will also give Skylabs an advantage over its competitors to offer solutions which are tailored to the needs of its future customers to the minutest of detail.
3.Improving positioning to attract customers & investors:
Skylabs can look at improving its position in the marketplace through active participation in knowledge sharing forums. These forums can act as excellent platform for Skylabs to showcase its capabilities in a industry vertical or technology horizontal to its prospective clients and at the same time attract possible future investors (venture capitalists) with the depth of its understanding, know-how and client base. It could further look at reaching out to possible investors through other industry forums such as CII (Confederation of Indian Industries) or FICCI (Federation of Indian Chambers of Commerce and Industry) etc.
4.Geographical expansion:
Given its limited financial & technical resources it may be advised that Skylabs should focus on expanding its reach in select markets only. An all out expansion strategy may force Skylabs to spread itself too thin and thereby forcing it to compromise on its ability to service its existing customers and innovate on its solutions. Hence, it is recommended that Skylabs should use the 80-20 rule to identify the geographies and solution sets it should focus on. Additionally, factors like pace of infrastructure development, governmental support etc. can be used as additional yardsticks to identify the geographies to go after. In each of the geographies identified, the firm could look at tying up with local hardware, software and consulting service providers to establish itself as a partner of choice for GIS and related services.