[TOWS Matrix] Application of the TOWS Matrix to Winnebago Industries Inc

Application of the TOWS Matrix to Winnebago Industries Inc. 
Winnebago, the largest manufacturer of recreational vehicles (RVs) produced a full line of such vehicles, but
emphasized traditional motor homes. The company, located in Forest City, Iowa, operated a large, modern andefficient plant.13

TOWS Matrix of Winnebago Industries Inc

The External and Internal Environment
The threats and opportunities in the external environment are condensed into the table shown as Figure 6. In
the past, the company had prospered by the high demand for RVs. However, serious threats from competitors as well as the gasoline shortage could have a great impact on the firm.
While Winnebago has considerable strengths, heavy reliance on essentially one product makes the company
vuh1erable to the external threats.

Strategies and Tactics
Based on the analysis of the situation, several alternative strategies and tactics are available to Winnebago.
Weaknesses and Threats (WT). The factors in the external environment, particularly the gasoline shortage, the high fuel prices, the slackening ill demand for recreational vehicles, as well as the increased competition
constitute serious threats to the enterprise. When these threats are seen in relation to the weaknesses, an
alternative would be to sell the company. But this strategic choice would probably be unacceptable to the
family-dominated management group.

Weaknesses and Opportunities (WO). Customers in the United States and abroad demand smaller RVs. But one of the weaknesses of the firm was the heavy reliance on relatively larger and higher-priced units.
Consequently, the development and manufacture of smaller vehicles could take advantage of the demand for
small RVs in a market segment neglected in the past by the firm. Furthermore, smaller plants could be built in
various parts of the country, thus alleviating the comparatively high transportation costs for the smaller RVs
from the factory to the dealers.

Strengths and Threats (ST). To cope with the threats in the external environment the company may use its
strengths. Specifically, diversifying into farm equipment and railroad cars, using the firm’s capabilities, can
alleviate problems caused by the slackening demand for RVs due to the secondary market created by the
custom of ‘trading up’. Similarly, the use of diesel engines in motor homes can reduce fuel consumption of
these vehicles. Impending safety regulations are expected to make more demands on RV manufacturers.
Rather than reacting to these regulations, Winnebago can use its extensive research and development
capabilities to develop safer vehicles.

Strengths and Opportunities (SO). Winnebago needs to use its strengths to take advantage of the opportunities. The good reputation of the firm, its service network its research and development as well as the manufacturing facilities, can be effectively used to produce smaller RVs. Similarly, most of these strengths facilitate the expansion into the international market. Finally, the firm’s capabilities can be used to diversify into modular housing. But the company has little or no knowledge of the housing market and some difficulties can be anticipated.

Source: usf.usfca.edu/fac_staff/weihrichh/