SOHO China: Design, Development, and Social Harmony SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of SOHO China: Design, Development, and Social Harmony
To maximize their effectiveness, color cases should be printed in color.Founded in 1995 by Zhang Xin and her husband Mr. Pan Shiyi, SOHO China has developed into a world-class real estate development firm that has consistently delivered high-quality projects known for their cutting-edge designs and investment potential. Despite the tremendous success of the firm, Zhang Xin still looks at the future with great uncertainty. Average residential pricing in China has dropped, as government continues to put downward pressure on residential housing prices through restrictions on the number of apartments a resident is allowed to purchase, and aggressive promotion of affordable housing on the low-end of the market. Zhang Xin wonders what opportunities and threats such market conditions present to SOHO. On the sales and marketing front, SOHO China has historically been geographically-focused only on high-end, design-driven projects in Shanghai and Beijing. As the market became more competitive, Zhang Xin wondered what key strategic decisions in regards to design, financing, and sales the company would need to make in order to maintain its competitive advantage in China.
Swot Analysis of "SOHO China: Design, Development, and Social Harmony" written by Arthur I Segel, Mukti Khaire includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Soho Xin facing as an external strategic factors. Some of the topics covered in SOHO China: Design, Development, and Social Harmony case study are - Strategic Management Strategies, Financial management, Organizational culture, Sales and Strategy & Execution.
Some of the macro environment factors that can be used to understand the SOHO China: Design, Development, and Social Harmony casestudy better are - – cloud computing is disrupting traditional business models, customer relationship management is fast transforming because of increasing concerns over data privacy, supply chains are disrupted by pandemic , increasing government debt because of Covid-19 spendings, there is backlash against globalization, increasing energy prices, banking and financial system is disrupted by Bitcoin and other crypto currencies,
central banks are concerned over increasing inflation, wage bills are increasing, etc
Introduction to SWOT Analysis of SOHO China: Design, Development, and Social Harmony
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in SOHO China: Design, Development, and Social Harmony case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Soho Xin, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Soho Xin 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 SOHO China: Design, Development, and Social Harmony can be done for the following purposes –
1. Strategic planning using facts provided in SOHO China: Design, Development, and Social Harmony case study
2. Improving business portfolio management of Soho Xin
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Soho Xin
Strengths SOHO China: Design, Development, and Social Harmony | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Soho Xin in SOHO China: Design, Development, and Social Harmony Harvard Business Review case study are -
Learning organization
- Soho Xin 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 Soho Xin is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in SOHO China: Design, Development, and Social Harmony Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Organizational Resilience of Soho Xin
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Soho Xin does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Soho Xin is one of the leading recruiters in the industry. Managers in the SOHO China: Design, Development, and Social Harmony are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Analytics focus
– Soho Xin 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 Arthur I Segel, Mukti Khaire 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.
Low bargaining power of suppliers
– Suppliers of Soho Xin in the sector have low bargaining power. SOHO China: Design, Development, and Social Harmony has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Soho Xin to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that Soho Xin 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.
Innovation driven organization
– Soho Xin is one of the most innovative firm in sector. Manager in SOHO China: Design, Development, and Social Harmony Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Cross disciplinary teams
– Horizontal connected teams at the Soho Xin 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.
Operational resilience
– The operational resilience strategy in the SOHO China: Design, Development, and Social Harmony 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.
Ability to lead change in Strategy & Execution field
– Soho Xin 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 Soho Xin in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Sustainable margins compare to other players in Strategy & Execution industry
– SOHO China: Design, Development, and Social Harmony firm has clearly differentiated products in the market place. This has enabled Soho Xin to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Soho Xin to invest into research and development (R&D) and innovation.
Strong track record of project management
– Soho Xin is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses SOHO China: Design, Development, and Social Harmony | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of SOHO China: Design, Development, and Social Harmony are -
Aligning sales with marketing
– It come across in the case study SOHO China: Design, Development, and Social Harmony 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 SOHO China: Design, Development, and Social Harmony can leverage the sales team experience to cultivate customer relationships as Soho Xin is planning to shift buying processes online.
Lack of clear differentiation of Soho Xin products
– To increase the profitability and margins on the products, Soho Xin needs to provide more differentiated products than what it is currently offering in the marketplace.
Interest costs
– Compare to the competition, Soho Xin 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.
Capital Spending Reduction
– Even during the low interest decade, Soho Xin 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.
No frontier risks strategy
– After analyzing the HBR case study SOHO China: Design, Development, and Social Harmony, it seems that company is thinking about the frontier risks that can impact Strategy & Execution 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Soho Xin is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study SOHO China: Design, Development, and Social Harmony can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Slow to strategic competitive environment developments
– As SOHO China: Design, Development, and Social Harmony HBR case study mentions - Soho Xin 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study SOHO China: Design, Development, and Social Harmony, it seems that the employees of Soho Xin 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.
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 Soho Xin supply chain. Even after few cautionary changes mentioned in the HBR case study - SOHO China: Design, Development, and Social Harmony, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Soho Xin vulnerable to further global disruptions in South East Asia.
Slow decision making process
– As mentioned earlier in the report, Soho Xin 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. Soho Xin 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Arthur I Segel, Mukti Khaire suggests that, Soho Xin 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.
Opportunities SOHO China: Design, Development, and Social Harmony | 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 SOHO China: Design, Development, and Social Harmony are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Soho Xin 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 Soho Xin 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 Soho Xin to hire the very best people irrespective of their geographical location.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Strategy & Execution industry, but it has also influenced the consumer preferences. Soho Xin can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Manufacturing automation
– Soho Xin can use the latest technology developments to improve its manufacturing and designing process in Strategy & Execution 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.
Learning at scale
– Online learning technologies has now opened space for Soho Xin 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Strategy & Execution industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Soho Xin 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. Soho Xin 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
– Soho Xin 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.
Buying journey improvements
– Soho Xin can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. SOHO China: Design, Development, and Social Harmony 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.
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. Soho Xin can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Soho Xin is facing challenges because of the dominance of functional experts in the organization. SOHO China: Design, Development, and Social Harmony 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.
Leveraging digital technologies
– Soho Xin 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.
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 Soho Xin in the consumer business. Now Soho Xin can target international markets with far fewer capital restrictions requirements than the existing system.
Developing new processes and practices
– Soho Xin can develop new processes and procedures in Strategy & Execution 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 SOHO China: Design, Development, and Social Harmony External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study SOHO China: Design, Development, and Social Harmony are -
Shortening product life cycle
– it is one of the major threat that Soho Xin is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Soho Xin business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Soho Xin 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Soho Xin in the Strategy & Execution industry. The Strategy & Execution 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.
Technology acceleration in Forth Industrial Revolution
– Soho Xin has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Soho Xin needs to keep up with the evolution of technology in the Strategy & Execution 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study SOHO China: Design, Development, and Social Harmony, Soho Xin may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Strategy & Execution .
Environmental challenges
– Soho Xin 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. Soho Xin can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Consumer confidence and its impact on Soho Xin 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.
Regulatory challenges
– Soho Xin 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 Strategy & Execution industry regulations.
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. Soho Xin 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.
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 Soho Xin in the Strategy & Execution 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.
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. Soho Xin needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Weighted SWOT Analysis of SOHO China: Design, Development, and Social Harmony 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 SOHO China: Design, Development, and Social Harmony 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 SOHO China: Design, Development, and Social Harmony 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 SOHO China: Design, Development, and Social Harmony 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 SOHO China: Design, Development, and Social Harmony 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 Soho Xin needs to make to build a sustainable competitive advantage.
