Oracle Corporation SWOT & PESTLE Analysis

Strength

1. Strong and stable financial performance: Oracle being a company with a profit margin of above 30% for the past 3 years, despite incurring a one-time charge pertaining to change in tax rules in the year 2018, it has shown steady growth of revenue and EPS. According to various sources, as Seeking alpha, Morningstar and many other analysis, it can be seen that the stocks are undervalued, as it has enough cash flow to cover its dividend even after allocating for development and expenses, thus making the company attractive from an investor point of view. Thus, making us derive its strong financial capability despite the current scenario. As a Zero debt company according to them stated in their annual reports, there are focusing on expansion of their company in foreseeable future funded through cash generated from operations.

2. First mover advantage in database segment: To be the first company to introduce relational database, allowed Oracle the opportunity to ride to be a market leader. This First mover advantage allows the company an edge over other companies in gaining huge market share. Its attribute of compatibility to provide end to end support and services, right from the front-end to back-end office support makes their product the best in the market. Also, Oracle being the only company which was capable of implementing global e-business solutions has made it’s strengthened its position. Even today, with continual innovations and improving existing products & services according to consumer demands, Oracle stands strong.

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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

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Environmental

1. Developing solutions for a sustainable environment: In current environment, where the customer’s consciousness is awakening, sustainability has become the new focus, where people are thinking more about the future and planning for its future generation than just their sustenance. And this has led to Sustainability becoming a major arm of business operations for any leading company and they have to address sustainability challenges with easily integrated solutions that can be amalgamated with their core business activities. Oracle, a technology firm is in the unique position of providing solutions that cover all spheres of IT and its sustainable business practices, hardware, applications and technology, from cloud data centres to business intelligence to smart utility grids. It reuses and recycles many of its technologies and business practices within its own operations. Similarly, it also preaches the jargon of Reuse, Recycle, and Reduce to its stakeholders and encourages its customers to leverage the Oracle Cloud, a more sustainable alternative. Oracle with its constant lookout and improving behaviour tries to contribute towards building a new economy that promotes greater resource productivity.

2. Adopting environment standards in internal operations: Oracle, the global company is committed use information technology to meet environmental challenges. As a global company, with an operational unit over 25 million square feet, the responsibility of sustainable use of natural resources is very impactful. It has to keep looking for ways to maximize energy efficiency, reduce its greenhouse gas emissions, and minimize water consumption and waste generation impartially across all operational units. This has led to a global adoption of certain strategies to be more responsible for the environment. These implementations include: Managing the consumption of energy, water, paper and other resources used by Oracle in its day-to-day operations; identifying opportunities to divert, minimize, reuse and recycle our waste stream; incorporating environmental considerations into procurement processes.

3. Strong implementation of responsible souring standards: Giant technology firms as Oracle, need to design and develop their product focusing on the environmental aspect and impact their hardware products will have, to being energy efficient, recyclability, upgradability, material conservation, and the management of hazardous materials. One of the core goals of Oracle has been to continuously eliminate or minimize waste generated in their manufacturing operations, and to make sure that waste is disposed of in an environmentally responsible manner. The100% of the standard laptops purchased by Oracle are ENERGY STAR and EPEAT certified and all of Oracle’s technology recyclers are ISO 14001 certified. Furthermore, approximately 6 million pounds of retired customer hardware and internal technology assets were collected for recycling or reuse in the fiscal year 2018.