VirtualChina.com: The Building of a Virtual Community SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of VirtualChina.com: The Building of a Virtual Community
In February 1997, Xindeco became the first Chinese technology company to list publicly. Buoyed by its successes, the ChinaVista site attempted to expand and become a "gateway," or niche portal, for international interest in China. With the basic ChinaVista site still garnering critical respect and foreign companies approaching the site's developers for assistance in entering the China market, a new business plan and a new site were created, which focused on aggregating members rather than (solely concentrating on) information resources--and thereby building loyalty. Their focus allowed the developers to realize the existence of a community peculiar to cyberspace, that of the "virtual foreign China-interested community"--a community dispersed around the world but united by a common interest in the commercial development in China.
Swot Analysis of "VirtualChina.com: The Building of a Virtual Community" written by Ali F. Farhoomand, Peter Lovelock includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Chinavista Community facing as an external strategic factors. Some of the topics covered in VirtualChina.com: The Building of a Virtual Community case study are - Strategic Management Strategies, Internet and Sales & Marketing.
Some of the macro environment factors that can be used to understand the VirtualChina.com: The Building of a Virtual Community casestudy better are - – technology disruption, banking and financial system is disrupted by Bitcoin and other crypto currencies, central banks are concerned over increasing inflation, increasing household debt because of falling income levels, supply chains are disrupted by pandemic , talent flight as more people leaving formal jobs, competitive advantages are harder to sustain because of technology dispersion,
cloud computing is disrupting traditional business models, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of VirtualChina.com: The Building of a Virtual Community
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in VirtualChina.com: The Building of a Virtual Community case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Chinavista Community, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Chinavista Community 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 VirtualChina.com: The Building of a Virtual Community can be done for the following purposes –
1. Strategic planning using facts provided in VirtualChina.com: The Building of a Virtual Community case study
2. Improving business portfolio management of Chinavista Community
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Chinavista Community
Strengths VirtualChina.com: The Building of a Virtual Community | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Chinavista Community in VirtualChina.com: The Building of a Virtual Community Harvard Business Review case study are -
Innovation driven organization
– Chinavista Community is one of the most innovative firm in sector. Manager in VirtualChina.com: The Building of a Virtual Community Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Strong track record of project management
– Chinavista Community is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Superior customer experience
– The customer experience strategy of Chinavista Community in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Low bargaining power of suppliers
– Suppliers of Chinavista Community in the sector have low bargaining power. VirtualChina.com: The Building of a Virtual Community has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Chinavista Community to manage not only supply disruptions but also source products at highly competitive prices.
Ability to recruit top talent
– Chinavista Community is one of the leading recruiters in the industry. Managers in the VirtualChina.com: The Building of a Virtual Community are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Sustainable margins compare to other players in Sales & Marketing industry
– VirtualChina.com: The Building of a Virtual Community firm has clearly differentiated products in the market place. This has enabled Chinavista Community to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Chinavista Community to invest into research and development (R&D) and innovation.
Organizational Resilience of Chinavista Community
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Chinavista Community does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to lead change in Sales & Marketing field
– Chinavista Community 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 Chinavista Community in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Chinavista Community digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Chinavista Community 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.
Operational resilience
– The operational resilience strategy in the VirtualChina.com: The Building of a Virtual Community 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.
High brand equity
– Chinavista Community has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Chinavista Community to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Effective Research and Development (R&D)
– Chinavista Community 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 VirtualChina.com: The Building of a Virtual Community - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses VirtualChina.com: The Building of a Virtual Community | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of VirtualChina.com: The Building of a Virtual Community are -
Low market penetration in new markets
– Outside its home market of Chinavista Community, firm in the HBR case study VirtualChina.com: The Building of a Virtual Community needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Aligning sales with marketing
– It come across in the case study VirtualChina.com: The Building of a Virtual Community 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 VirtualChina.com: The Building of a Virtual Community can leverage the sales team experience to cultivate customer relationships as Chinavista Community is planning to shift buying processes online.
Workers concerns about automation
– As automation is fast increasing in the segment, Chinavista Community needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study VirtualChina.com: The Building of a Virtual Community, in the dynamic environment Chinavista Community has struggled to respond to the nimble upstart competition. Chinavista Community has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Chinavista Community is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study VirtualChina.com: The Building of a Virtual Community 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 VirtualChina.com: The Building of a Virtual Community, it seems that company is thinking about the frontier risks that can impact Sales & Marketing 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.
Capital Spending Reduction
– Even during the low interest decade, Chinavista Community 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the VirtualChina.com: The Building of a Virtual Community HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Chinavista Community has relatively successful track record of launching new products.
High operating costs
– Compare to the competitors, firm in the HBR case study VirtualChina.com: The Building of a Virtual Community 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 Chinavista Community 's lucrative customers.
Increasing silos among functional specialists
– The organizational structure of Chinavista Community is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Chinavista Community needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Chinavista Community to focus more on services rather than just following the product oriented approach.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study VirtualChina.com: The Building of a Virtual Community, is just above the industry average. Chinavista Community 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.
Opportunities VirtualChina.com: The Building of a Virtual Community | 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 VirtualChina.com: The Building of a Virtual Community are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Chinavista Community can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, VirtualChina.com: The Building of a Virtual Community, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Leveraging digital technologies
– Chinavista Community 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Chinavista Community in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Sales & Marketing segment, and it will provide faster access to the consumers.
Loyalty marketing
– Chinavista Community 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.
Creating value in data economy
– The success of analytics program of Chinavista Community has opened avenues for new revenue streams for the organization in the industry. This can help Chinavista Community to build a more holistic ecosystem as suggested in the VirtualChina.com: The Building of a Virtual Community case study. Chinavista Community can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Better consumer reach
– The expansion of the 5G network will help Chinavista Community to increase its market reach. Chinavista Community 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.
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 Chinavista Community in the consumer business. Now Chinavista Community can target international markets with far fewer capital restrictions requirements than the existing system.
Learning at scale
– Online learning technologies has now opened space for Chinavista Community 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 Chinavista Community 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Sales & Marketing industry, but it has also influenced the consumer preferences. Chinavista Community can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Buying journey improvements
– Chinavista Community can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. VirtualChina.com: The Building of a Virtual Community 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Chinavista Community 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.
Using analytics as competitive advantage
– Chinavista Community 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 VirtualChina.com: The Building of a Virtual Community - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Chinavista Community to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats VirtualChina.com: The Building of a Virtual Community External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study VirtualChina.com: The Building of a Virtual Community are -
High dependence on third party suppliers
– Chinavista Community 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.
Stagnating economy with rate increase
– Chinavista Community 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.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Chinavista Community will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Easy access to finance
– Easy access to finance in Sales & Marketing field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Chinavista Community can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Chinavista Community needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Chinavista Community 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 VirtualChina.com: The Building of a Virtual Community .
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 Chinavista Community in the Sales & Marketing sector and impact the bottomline of the organization.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Chinavista Community in the Sales & Marketing industry. The Sales & Marketing 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.
Shortening product life cycle
– it is one of the major threat that Chinavista Community is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Consumer confidence and its impact on Chinavista Community 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.
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 Chinavista Community.
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 Chinavista Community business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of VirtualChina.com: The Building of a Virtual Community 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 VirtualChina.com: The Building of a Virtual Community 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 VirtualChina.com: The Building of a Virtual Community 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 VirtualChina.com: The Building of a Virtual Community 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 VirtualChina.com: The Building of a Virtual Community 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 Chinavista Community needs to make to build a sustainable competitive advantage.