Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Organizational Development
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd.
This case is about the establishment, growth, and direction of the Shanghai Zhangjiang Hi-Tech Park ("Zhangjiang Park"), which is located in the Pudong New Area of Shanghai. Considered to be one of the most competitive hi-tech industry clusters in China, the combined business strategy of Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. ("Zhangjiang Hi-Tech"), a key operator of Zhangjiang Park, included real estate development, hi-tech investment, and integrated services. As of the time of the case, members of the Board of Directors of Zhangjiang Hi-Tech were faced with open questions such as how Zhangjiang Park would be able to maintain its sustainable competitiveness in comparison with other hi-tech and industrial parks in China. Board members were also concerned with how Zhangjiang Hi-Tech would be able to meet the needs of both capital market and regional development.
Authors :: Robert G. Eccles, Catherine Zhang, Cheng-Hua Tzeng, Liang Cheng
Swot Analysis of "Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd." written by Robert G. Eccles, Catherine Zhang, Cheng-Hua Tzeng, Liang Cheng includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Zhangjiang Tech facing as an external strategic factors. Some of the topics covered in Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. case study are - Strategic Management Strategies, Economic development, Policy, Sustainability, Technology and Organizational Development.
Some of the macro environment factors that can be used to understand the Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. casestudy better are - – there is increasing trade war between United States & China, supply chains are disrupted by pandemic , increasing inequality as vast percentage of new income is going to the top 1%, competitive advantages are harder to sustain because of technology dispersion, increasing government debt because of Covid-19 spendings, talent flight as more people leaving formal jobs, increasing transportation and logistics costs,
increasing commodity prices, increasing energy prices, etc
Introduction to SWOT Analysis of Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd.
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Zhangjiang Tech, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Zhangjiang Tech 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 Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. can be done for the following purposes –
1. Strategic planning using facts provided in Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. case study
2. Improving business portfolio management of Zhangjiang Tech
3. Assessing feasibility of the new initiative in Organizational Development field.
4. Making a Organizational Development topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Zhangjiang Tech
Strengths Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Zhangjiang Tech in Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. Harvard Business Review case study are -
Sustainable margins compare to other players in Organizational Development industry
– Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. firm has clearly differentiated products in the market place. This has enabled Zhangjiang Tech to fetch slight price premium compare to the competitors in the Organizational Development industry. The sustainable margins have also helped Zhangjiang Tech to invest into research and development (R&D) and innovation.
Superior customer experience
– The customer experience strategy of Zhangjiang Tech in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Successful track record of launching new products
– Zhangjiang Tech has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Zhangjiang Tech 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.
Ability to recruit top talent
– Zhangjiang Tech is one of the leading recruiters in the industry. Managers in the Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Innovation driven organization
– Zhangjiang Tech is one of the most innovative firm in sector. Manager in Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Organizational Resilience of Zhangjiang Tech
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Zhangjiang Tech does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– Zhangjiang Tech has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. 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.
Digital Transformation in Organizational Development segment
- digital transformation varies from industry to industry. For Zhangjiang Tech digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Zhangjiang Tech has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Effective Research and Development (R&D)
– Zhangjiang Tech has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Strong track record of project management
– Zhangjiang Tech is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Operational resilience
– The operational resilience strategy in the Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. 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.
Analytics focus
– Zhangjiang Tech is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Robert G. Eccles, Catherine Zhang, Cheng-Hua Tzeng, Liang Cheng can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Weaknesses Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. are -
Low market penetration in new markets
– Outside its home market of Zhangjiang Tech, firm in the HBR case study Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Lack of clear differentiation of Zhangjiang Tech products
– To increase the profitability and margins on the products, Zhangjiang Tech needs to provide more differentiated products than what it is currently offering in the marketplace.
High operating costs
– Compare to the competitors, firm in the HBR case study Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Zhangjiang Tech 's lucrative customers.
Slow decision making process
– As mentioned earlier in the report, Zhangjiang Tech has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Zhangjiang Tech even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Skills based hiring
– The stress on hiring functional specialists at Zhangjiang Tech has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
High bargaining power of channel partners
– Because of the regulatory requirements, Robert G. Eccles, Catherine Zhang, Cheng-Hua Tzeng, Liang Cheng suggests that, Zhangjiang Tech 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.
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 Zhangjiang Tech supply chain. Even after few cautionary changes mentioned in the HBR case study - Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd., it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Zhangjiang Tech vulnerable to further global disruptions in South East Asia.
Products dominated business model
– Even though Zhangjiang Tech 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 - Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. should strive to include more intangible value offerings along with its core products and services.
Slow to strategic competitive environment developments
– As Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. HBR case study mentions - Zhangjiang Tech takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Interest costs
– Compare to the competition, Zhangjiang Tech has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Increasing silos among functional specialists
– The organizational structure of Zhangjiang Tech is dominated by functional specialists. It is not different from other players in the Organizational Development segment. Zhangjiang Tech needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Zhangjiang Tech to focus more on services rather than just following the product oriented approach.
Opportunities Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. | 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 Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. are -
Building a culture of innovation
– managers at Zhangjiang Tech 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 Organizational Development segment.
Creating value in data economy
– The success of analytics program of Zhangjiang Tech has opened avenues for new revenue streams for the organization in the industry. This can help Zhangjiang Tech to build a more holistic ecosystem as suggested in the Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. case study. Zhangjiang Tech can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
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 Zhangjiang Tech 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.
Leveraging digital technologies
– Zhangjiang Tech can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Using analytics as competitive advantage
– Zhangjiang Tech 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 Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Zhangjiang Tech to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Zhangjiang Tech can use these opportunities to build new business models that can help the communities that Zhangjiang Tech operates in. Secondly it can use opportunities from government spending in Organizational Development sector.
Better consumer reach
– The expansion of the 5G network will help Zhangjiang Tech to increase its market reach. Zhangjiang Tech will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Zhangjiang Tech can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Zhangjiang Tech 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 Zhangjiang Tech to hire the very best people irrespective of their geographical location.
Low interest rates
– Even though inflation is raising its head in most developed economies, Zhangjiang Tech 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Organizational Development industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Zhangjiang Tech can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Zhangjiang Tech can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Loyalty marketing
– Zhangjiang Tech has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Developing new processes and practices
– Zhangjiang Tech can develop new processes and procedures in Organizational Development industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Threats Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. are -
Increasing wage structure of Zhangjiang Tech
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Zhangjiang Tech.
Technology acceleration in Forth Industrial Revolution
– Zhangjiang Tech has witnessed rapid integration of technology during Covid-19 in the Organizational Development industry. As one of the leading players in the industry, Zhangjiang Tech needs to keep up with the evolution of technology in the Organizational Development 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.
Consumer confidence and its impact on Zhangjiang Tech 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Zhangjiang Tech in the Organizational Development industry. The Organizational Development 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.
Regulatory challenges
– Zhangjiang Tech 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 Organizational Development industry regulations.
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. Zhangjiang Tech needs to understand the core reasons impacting the Organizational Development industry. This will help it in building a better workplace.
Stagnating economy with rate increase
– Zhangjiang Tech 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd., Zhangjiang Tech may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Organizational Development .
Shortening product life cycle
– it is one of the major threat that Zhangjiang Tech is facing in Organizational Development sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Zhangjiang Tech in the Organizational Development sector and impact the bottomline of the organization.
Environmental challenges
– Zhangjiang Tech needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Zhangjiang Tech can take advantage of this fund but it will also bring new competitors in the Organizational Development industry.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Zhangjiang Tech business can come under increasing regulations regarding data privacy, data security, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Zhangjiang Tech with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Weighted SWOT Analysis of Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. 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 Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. 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 Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. 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 Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. 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 Shanghai Zhangjiang Hi-Tech Park Development Co., Ltd. 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 Zhangjiang Tech needs to make to build a sustainable competitive advantage.
