Johnson Controls SWOT & PESTLE Analysis

Strength

1. Diverse Product & Service Portfolio: Johnson Controls provides End to End solution expertise in building environments that deliver energy savings, operational savings and sustainable solutions for homeowners, schools or major military installations across different industries. Its portfolio has 3 leading refrigeration brands and 11 air distribution brands.

2. Highly respected brand Name: Company is regularly featured in Fortune U.S. 500 list, current rank is 70. Ranked as one of the world's most ethical companies by Ethisphere, and also ranked 14th in Corporate Responsibility Magazine's 100 Best Corporate Citizens list. Ranked 78 in Green Ranking Global Top 100 by Newsweek.

3. Inorganic Expansion through Mergers and Acquisitions, Joint Ventures, etc.: Company is extending its edge by means of mergers, acquisitions and joint ventures. A joint venture with Hitachi completed last October, Johnson Controls is adding respected name to its portfolio to broaden its reach in several Asian markets: China, Taiwan, Japan, and India. Also, merger with Tyco International exemplifies its commitment to deliver more efficient solutions to its clients. Also, Johnson Controls is spinning off of its automotive business to focus on its core competency by operating in building efficiency and power solutions.

4. Rich Client Base across all business segments: In automotive industry, the company’s major customers are Daimler, Chrysler AG, Ford Motor Company, General Motors Corporation, Nissan Motor Co., Ltd., Toyota Motor Corporation and Volkswagen. The segment is the major supplier of batteries to, Bosch Group, Costco, Interstate Battery System of America, Pep Boys and Sears, Roebuck & Co. It is also a major supplier of automotive batteries to Wal-Mart Stores.

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Weakness

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Opportunity

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Threat

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Political

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Economic

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Social

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Technological

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Legal

1. Strong compliance framework across the supply chain: A socially and legally responsible corporation needs to implement strong compliance standards for suppliers, so that there are no legal, ethical or social violations. Johnson Controls has several manufacturing operations and suppliers that are located outside the United States. Johnson Controls has established Procurement Policies, Policies on Conflict Minerals, Guidelines for CSR in Supply Chain, Guidelines for Green Procurement, and Technical Requirements so that its products and solutions are safe and compliant and do not violate any sustainability standards.

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Environmental

1. Development of environmentally responsible products, services and operations: Focusing on environmental sustainability in its products, services and operations is a key to Johnson Controls’ ambition to create a positive impact in people’s lives. Further the diversity of product portfolio and markets served by Johnson Controls, increase the complexity and business risks across the supply chain. The company’s innovation team focuses on building products which not only help customers to be more efficient and productive but also reduce their energy consumption and emissions. Johnson Controls’ portfolio of products and solutions help organizations analyze and reduce environmental emissions while maintaining operational excellence.

2. Organizational initiative – Better Buildings, Better Plants Challenge for improved energy efficiency: Energy efficiency is a key factor to achieve sustainability in industrial organizations. This is all the more true for Johnson Controls which is a leader in building technology and energy storage sector. The organization wide implementation of Energy Hunt program which covered 79 facilities across 16 million-square-feet has helped in achieving a threefold increase in identified energy savings projects. The program has also helped company achieve its Better Plants Challenge goal. Johnson Controls has also implemented pilot Energy hunts at its supplier facilities which have helped in energy savings in the range of 5-10 percent.