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 - – challanges to central banks by blockchain based private currencies, increasing energy prices, wage bills are increasing, technology disruption, cloud computing is disrupting traditional business models, there is increasing trade war between United States & China, increasing inequality as vast percentage of new income is going to the top 1%,
increasing government debt because of Covid-19 spendings, talent flight as more people leaving formal jobs, 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 -
Ability to lead change in Strategy & Execution field
– Nse Schneider 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 Nse Schneider in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Cross disciplinary teams
– Horizontal connected teams at the Nse Schneider 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 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.
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.
Effective Research and Development (R&D)
– Nse Schneider 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 NSE Electric Co. Ltd. and Its International Cooperation - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
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.
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.
Successful track record of launching new products
– Nse Schneider has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Nse Schneider 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.
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.
Analytics focus
– Nse Schneider 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 Miao Cui, Lei Xue, Dashuang Dai 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.
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.
Superior customer experience
– The customer experience strategy of Nse Schneider in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
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 -
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.
Lack of clear differentiation of Nse Schneider products
– To increase the profitability and margins on the products, Nse Schneider needs to provide more differentiated products than what it is currently offering in the marketplace.
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.
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.
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.
Need for greater diversity
– Nse Schneider has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Capital Spending Reduction
– Even during the low interest decade, Nse Schneider 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.
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.
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.
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.
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.
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 -
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 Nse Schneider in the consumer business. Now Nse Schneider can target international markets with far fewer capital restrictions requirements than the existing system.
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.
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. Nse Schneider can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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.
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.
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.
Creating value in data economy
– The success of analytics program of Nse Schneider has opened avenues for new revenue streams for the organization in the industry. This can help Nse Schneider to build a more holistic ecosystem as suggested in the Shanghai NSE Electric Co. Ltd. and Its International Cooperation case study. Nse Schneider can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
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.
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.
Using analytics as competitive advantage
– Nse Schneider 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 NSE Electric Co. Ltd. and Its International Cooperation - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Nse Schneider to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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.
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. Nse Schneider can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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 Nse Schneider 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.
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 -
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.
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 Nse Schneider in the Strategy & Execution sector and impact the bottomline of the organization.
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 Nse Schneider business can come under increasing regulations regarding data privacy, data security, etc.
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 NSE Electric Co. Ltd. and Its International Cooperation, Nse Schneider 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 .
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Nse Schneider 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 Shanghai NSE Electric Co. Ltd. and Its International Cooperation .
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.
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. Nse Schneider needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
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.
Consumer confidence and its impact on Nse Schneider 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 Nse Schneider.
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.
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.
