Ready to Take Off (B): China's Re-Entry into Global Aerospace SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Ready to Take Off (B): China's Re-Entry into Global Aerospace
This case illustrates China's attempts at building its own regional jets and large civil aircraft. The case can be used to teach courses in international competitiveness and strategic management at the country, industry or firm level. It can also be used as an introduction to corporate mission and governance issues for companies that are dominated by government shareholders.
Swot Analysis of "Ready to Take Off (B): China's Re-Entry into Global Aerospace" written by Dean Xu, Isabella Chan includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that China's Jets facing as an external strategic factors. Some of the topics covered in Ready to Take Off (B): China's Re-Entry into Global Aerospace case study are - Strategic Management Strategies, Operations management and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Ready to Take Off (B): China's Re-Entry into Global Aerospace casestudy better are - – increasing household debt because of falling income levels, digital marketing is dominated by two big players Facebook and Google, geopolitical disruptions, wage bills are increasing, challanges to central banks by blockchain based private currencies, technology disruption, there is backlash against globalization,
increasing inequality as vast percentage of new income is going to the top 1%, increasing energy prices, etc
Introduction to SWOT Analysis of Ready to Take Off (B): China's Re-Entry into Global Aerospace
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Ready to Take Off (B): China's Re-Entry into Global Aerospace case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the China's Jets, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which China's Jets operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Ready to Take Off (B): China's Re-Entry into Global Aerospace can be done for the following purposes –
1. Strategic planning using facts provided in Ready to Take Off (B): China's Re-Entry into Global Aerospace case study
2. Improving business portfolio management of China's Jets
3. Assessing feasibility of the new initiative in Leadership & Managing People field.
4. Making a Leadership & Managing People topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of China's Jets
Strengths Ready to Take Off (B): China's Re-Entry into Global Aerospace | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of China's Jets in Ready to Take Off (B): China's Re-Entry into Global Aerospace Harvard Business Review case study are -
Organizational Resilience of China's Jets
– The covid-19 pandemic has put organizational resilience at the centre of everthing that China's Jets does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Learning organization
- China's Jets is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at China's Jets is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Ready to Take Off (B): China's Re-Entry into Global Aerospace Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Training and development
– China's Jets has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Ready to Take Off (B): China's Re-Entry into Global Aerospace Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Ability to lead change in Leadership & Managing People field
– China's Jets is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled China's Jets in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Ability to recruit top talent
– China's Jets is one of the leading recruiters in the industry. Managers in the Ready to Take Off (B): China's Re-Entry into Global Aerospace are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Cross disciplinary teams
– Horizontal connected teams at the China's Jets are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
High switching costs
– The high switching costs that China's Jets has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Operational resilience
– The operational resilience strategy in the Ready to Take Off (B): China's Re-Entry into Global Aerospace Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Low bargaining power of suppliers
– Suppliers of China's Jets in the sector have low bargaining power. Ready to Take Off (B): China's Re-Entry into Global Aerospace has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps China's Jets to manage not only supply disruptions but also source products at highly competitive prices.
Sustainable margins compare to other players in Leadership & Managing People industry
– Ready to Take Off (B): China's Re-Entry into Global Aerospace firm has clearly differentiated products in the market place. This has enabled China's Jets to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped China's Jets to invest into research and development (R&D) and innovation.
Successful track record of launching new products
– China's Jets has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. China's Jets has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Highly skilled collaborators
– China's Jets has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Ready to Take Off (B): China's Re-Entry into Global Aerospace HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses Ready to Take Off (B): China's Re-Entry into Global Aerospace | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Ready to Take Off (B): China's Re-Entry into Global Aerospace are -
Aligning sales with marketing
– It come across in the case study Ready to Take Off (B): China's Re-Entry into Global Aerospace that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Ready to Take Off (B): China's Re-Entry into Global Aerospace can leverage the sales team experience to cultivate customer relationships as China's Jets is planning to shift buying processes online.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of China's Jets supply chain. Even after few cautionary changes mentioned in the HBR case study - Ready to Take Off (B): China's Re-Entry into Global Aerospace, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left China's Jets vulnerable to further global disruptions in South East Asia.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Ready to Take Off (B): China's Re-Entry into Global Aerospace, is just above the industry average. China's Jets needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
High cash cycle compare to competitors
China's Jets has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
High bargaining power of channel partners
– Because of the regulatory requirements, Dean Xu, Isabella Chan suggests that, China's Jets is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Capital Spending Reduction
– Even during the low interest decade, China's Jets has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Increasing silos among functional specialists
– The organizational structure of China's Jets is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. China's Jets needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help China's Jets to focus more on services rather than just following the product oriented approach.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, China's Jets is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Ready to Take Off (B): China's Re-Entry into Global Aerospace can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
No frontier risks strategy
– After analyzing the HBR case study Ready to Take Off (B): China's Re-Entry into Global Aerospace, it seems that company is thinking about the frontier risks that can impact Leadership & Managing People strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Ready to Take Off (B): China's Re-Entry into Global Aerospace, it seems that the employees of China's Jets don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Products dominated business model
– Even though China's Jets has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Ready to Take Off (B): China's Re-Entry into Global Aerospace should strive to include more intangible value offerings along with its core products and services.
Opportunities Ready to Take Off (B): China's Re-Entry into Global Aerospace | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Ready to Take Off (B): China's Re-Entry into Global Aerospace are -
Building a culture of innovation
– managers at China's Jets can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Leadership & Managing People segment.
Redefining models of collaboration and team work
– As explained in the weaknesses section, China's Jets is facing challenges because of the dominance of functional experts in the organization. Ready to Take Off (B): China's Re-Entry into Global Aerospace case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Low interest rates
– Even though inflation is raising its head in most developed economies, China's Jets can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Learning at scale
– Online learning technologies has now opened space for China's Jets to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help China's Jets to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Manufacturing automation
– China's Jets can use the latest technology developments to improve its manufacturing and designing process in Leadership & Managing People segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, China's Jets can use these opportunities to build new business models that can help the communities that China's Jets operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Lowering marketing communication costs
– 5G expansion will open new opportunities for China's Jets in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Leadership & Managing People segment, and it will provide faster access to the consumers.
Buying journey improvements
– China's Jets can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Ready to Take Off (B): China's Re-Entry into Global Aerospace suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects China's Jets can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for China's Jets to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for China's Jets to hire the very best people irrespective of their geographical location.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for China's Jets in the consumer business. Now China's Jets can target international markets with far fewer capital restrictions requirements than the existing system.
Using analytics as competitive advantage
– China's Jets has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Ready to Take Off (B): China's Re-Entry into Global Aerospace - to build a competitive advantage using analytics. The analytics driven competitive advantage can help China's Jets to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Ready to Take Off (B): China's Re-Entry into Global Aerospace External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Ready to Take Off (B): China's Re-Entry into Global Aerospace are -
Stagnating economy with rate increase
– China's Jets can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Consumer confidence and its impact on China's Jets demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents China's Jets with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of China's Jets.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for China's Jets in the Leadership & Managing People industry. The Leadership & Managing People industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. China's Jets needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Technology acceleration in Forth Industrial Revolution
– China's Jets has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, China's Jets needs to keep up with the evolution of technology in the Leadership & Managing People sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Regulatory challenges
– China's Jets needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Leadership & Managing People industry regulations.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Shortening product life cycle
– it is one of the major threat that China's Jets is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, China's Jets can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Ready to Take Off (B): China's Re-Entry into Global Aerospace .
High dependence on third party suppliers
– China's Jets high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Ready to Take Off (B): China's Re-Entry into Global Aerospace, China's Jets may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Leadership & Managing People .
Weighted SWOT Analysis of Ready to Take Off (B): China's Re-Entry into Global Aerospace Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Ready to Take Off (B): China's Re-Entry into Global Aerospace needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Ready to Take Off (B): China's Re-Entry into Global Aerospace is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Ready to Take Off (B): China's Re-Entry into Global Aerospace is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Ready to Take Off (B): China's Re-Entry into Global Aerospace is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that China's Jets needs to make to build a sustainable competitive advantage.
