Shanghai NSE Electric Co. Ltd. and Its International Cooperation SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Shanghai NSE Electric Co. Ltd. and Its International Cooperation
Shanghai NSE Electric Co. Ltd. (NSE), a medium-sized manufacturer of marine switch panels, had entered into a joint venture with Schneider Electric under which NSE was Schneider's sole technology licensee in China. NSE felt fortunate because the world shipbuilding market was strong and orders were often full. With comprehensive and close cooperation, NSE was confident in Schneider. Nevertheless, Schneider announced that it would issue a second license to NSE's outsourcing manufacturer, SaierNico Electric & Automation. This meant that a competitor that produced and sold products of the same brand would emerge in the Chinese market. What was worse, this competitor had been cultivated by NSE. The CEO of NSE believed that NSE had three options: (1) continue to cooperate with Schneider; (2) broaden its business and cooperate with other powerful companies; or (3) invest more in local innovation to develop its own brand. Miao Cui is affiliated with Dalian University of Technology.
Swot Analysis of "Shanghai NSE Electric Co. Ltd. and Its International Cooperation" written by Miao Cui, Lei Xue, Dashuang Dai includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Nse Schneider facing as an external strategic factors. Some of the topics covered in Shanghai NSE Electric Co. Ltd. and Its International Cooperation case study are - Strategic Management Strategies, International business and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Shanghai NSE Electric Co. Ltd. and Its International Cooperation casestudy better are - – digital marketing is dominated by two big players Facebook and Google, supply chains are disrupted by pandemic , increasing transportation and logistics costs, customer relationship management is fast transforming because of increasing concerns over data privacy, cloud computing is disrupting traditional business models, increasing inequality as vast percentage of new income is going to the top 1%, technology disruption,
increasing energy prices, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Shanghai NSE Electric Co. Ltd. and Its International Cooperation
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Shanghai NSE Electric Co. Ltd. and Its International Cooperation case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Nse Schneider, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Nse Schneider 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 NSE Electric Co. Ltd. and Its International Cooperation can be done for the following purposes –
1. Strategic planning using facts provided in Shanghai NSE Electric Co. Ltd. and Its International Cooperation case study
2. Improving business portfolio management of Nse Schneider
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 Nse Schneider
Strengths Shanghai NSE Electric Co. Ltd. and Its International Cooperation | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Nse Schneider in Shanghai NSE Electric Co. Ltd. and Its International Cooperation Harvard Business Review case study are -
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Nse Schneider digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Nse Schneider 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.
Highly skilled collaborators
– Nse Schneider 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 Shanghai NSE Electric Co. Ltd. and Its International Cooperation HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Sustainable margins compare to other players in Strategy & Execution industry
– Shanghai NSE Electric Co. Ltd. and Its International Cooperation firm has clearly differentiated products in the market place. This has enabled Nse Schneider to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Nse Schneider to invest into research and development (R&D) and innovation.
High brand equity
– Nse Schneider has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Nse Schneider to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Strong track record of project management
– Nse Schneider is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High switching costs
– The high switching costs that Nse Schneider 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.
Diverse revenue streams
– Nse Schneider is present in almost all the verticals within the industry. This has provided firm in Shanghai NSE Electric Co. Ltd. and Its International Cooperation case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Low bargaining power of suppliers
– Suppliers of Nse Schneider in the sector have low bargaining power. Shanghai NSE Electric Co. Ltd. and Its International Cooperation has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Nse Schneider to manage not only supply disruptions but also source products at highly competitive prices.
Training and development
– Nse Schneider has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Shanghai NSE Electric Co. Ltd. and Its International Cooperation 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.
Operational resilience
– The operational resilience strategy in the Shanghai NSE Electric Co. Ltd. and Its International Cooperation 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.
Learning organization
- Nse Schneider 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 Nse Schneider is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Shanghai NSE Electric Co. Ltd. and Its International Cooperation Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– Nse Schneider is one of the leading recruiters in the industry. Managers in the Shanghai NSE Electric Co. Ltd. and Its International Cooperation are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Weaknesses Shanghai NSE Electric Co. Ltd. and Its International Cooperation | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Shanghai NSE Electric Co. Ltd. and Its International Cooperation are -
High operating costs
– Compare to the competitors, firm in the HBR case study Shanghai NSE Electric Co. Ltd. and Its International Cooperation 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 Nse Schneider 's lucrative customers.
Slow to strategic competitive environment developments
– As Shanghai NSE Electric Co. Ltd. and Its International Cooperation HBR case study mentions - Nse Schneider 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 Shanghai NSE Electric Co. Ltd. and Its International Cooperation, it seems that the employees of Nse Schneider 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Shanghai NSE Electric Co. Ltd. and Its International Cooperation, is just above the industry average. Nse Schneider 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.
Skills based hiring
– The stress on hiring functional specialists at Nse Schneider 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.
Interest costs
– Compare to the competition, Nse Schneider 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.
No frontier risks strategy
– After analyzing the HBR case study Shanghai NSE Electric Co. Ltd. and Its International Cooperation, 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.
High cash cycle compare to competitors
Nse Schneider 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Nse Schneider 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.
Aligning sales with marketing
– It come across in the case study Shanghai NSE Electric Co. Ltd. and Its International Cooperation 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 Shanghai NSE Electric Co. Ltd. and Its International Cooperation can leverage the sales team experience to cultivate customer relationships as Nse Schneider 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 Nse Schneider supply chain. Even after few cautionary changes mentioned in the HBR case study - Shanghai NSE Electric Co. Ltd. and Its International Cooperation, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Nse Schneider vulnerable to further global disruptions in South East Asia.
Opportunities Shanghai NSE Electric Co. Ltd. and Its International Cooperation | 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 NSE Electric Co. Ltd. and Its International Cooperation are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Nse Schneider 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, Shanghai NSE Electric Co. Ltd. and Its International Cooperation, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Loyalty marketing
– Nse Schneider 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Nse Schneider 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 Nse Schneider 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. Nse Schneider 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. Nse Schneider 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.
Better consumer reach
– The expansion of the 5G network will help Nse Schneider to increase its market reach. Nse Schneider 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.
Developing new processes and practices
– Nse Schneider 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.
Buying journey improvements
– Nse Schneider can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Shanghai NSE Electric Co. Ltd. and Its International Cooperation 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 Nse Schneider can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Nse Schneider is facing challenges because of the dominance of functional experts in the organization. Shanghai NSE Electric Co. Ltd. and Its International Cooperation 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.
Manufacturing automation
– Nse Schneider 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Nse Schneider in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Strategy & Execution segment, and it will provide faster access to the consumers.
Building a culture of innovation
– managers at Nse Schneider 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 Strategy & Execution segment.
Threats Shanghai NSE Electric Co. Ltd. and Its International Cooperation External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Shanghai NSE Electric Co. Ltd. and Its International Cooperation are -
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. Nse Schneider needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Regulatory challenges
– Nse Schneider 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.
High dependence on third party suppliers
– Nse Schneider 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Nse Schneider with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Shortening product life cycle
– it is one of the major threat that Nse Schneider is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Technology acceleration in Forth Industrial Revolution
– Nse Schneider has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Nse Schneider 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Nse Schneider 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.
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 Nse Schneider.
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.
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.
Easy access to finance
– Easy access to finance in Strategy & Execution field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Nse Schneider can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Stagnating economy with rate increase
– Nse Schneider 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. Nse Schneider 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.
Weighted SWOT Analysis of Shanghai NSE Electric Co. Ltd. and Its International Cooperation 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 NSE Electric Co. Ltd. and Its International Cooperation 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 NSE Electric Co. Ltd. and Its International Cooperation 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 NSE Electric Co. Ltd. and Its International Cooperation 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 NSE Electric Co. Ltd. and Its International Cooperation 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 Nse Schneider needs to make to build a sustainable competitive advantage.