CSCEC: Transformation and Development SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of CSCEC: Transformation and Development
In 2001, CSCEC, the largest residential building constructor in China, greeted its new General Manager, Wenjie Sun, who was the President of China Overseas, a Hong Kong-listed subsidiary of CSCEC. In the following 9 years, Sun strived to advance the transformation and development of CSCEC, making it a highly competitive company from one of bureaucratic in nature, listed in Shanghai Exchange of Share A, and enter the echelon of Fortune 500. In 2010, Sun retired at the age of 64, and Jun Yi, Sun's close associate, took over the top position. Immediately after Yi's succession, he made all efforts to push the transformation and development of CSCEC in a new era. Yi embraced the hope that CSCEC would be further upgraded in the following 5 or 10 years in his tenure. He started to make adjustments in regard to the corporation's strategic goals and developing path, its business structure and mix, its business models, internal management controls, etc. CSCEC's own operation conditions had changed greatly compared to that 10 years ago, so did its external business environment. Faced with these circumstances, Yi was pondering over such questions: Were the series of strategic measures taken by CSCEC appropriate? What new measures should be taken in the next step?
Authors :: F. Warren McFarlan, Donghong Li, Hong Zhang
Swot Analysis of "CSCEC: Transformation and Development" written by F. Warren McFarlan, Donghong Li, Hong Zhang includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Cscec Yi facing as an external strategic factors. Some of the topics covered in CSCEC: Transformation and Development case study are - Strategic Management Strategies, Innovation, Strategy and Strategy & Execution.
Some of the macro environment factors that can be used to understand the CSCEC: Transformation and Development casestudy better are - – cloud computing is disrupting traditional business models, increasing inequality as vast percentage of new income is going to the top 1%, talent flight as more people leaving formal jobs, banking and financial system is disrupted by Bitcoin and other crypto currencies, wage bills are increasing, central banks are concerned over increasing inflation, increasing government debt because of Covid-19 spendings,
there is backlash against globalization, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of CSCEC: Transformation and Development
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in CSCEC: Transformation and Development case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Cscec Yi, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Cscec Yi 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 CSCEC: Transformation and Development can be done for the following purposes –
1. Strategic planning using facts provided in CSCEC: Transformation and Development case study
2. Improving business portfolio management of Cscec Yi
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 Cscec Yi
Strengths CSCEC: Transformation and Development | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Cscec Yi in CSCEC: Transformation and Development Harvard Business Review case study are -
High switching costs
– The high switching costs that Cscec Yi 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.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Cscec Yi digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Cscec Yi 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.
High brand equity
– Cscec Yi has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Cscec Yi to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Operational resilience
– The operational resilience strategy in the CSCEC: Transformation and Development Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Analytics focus
– Cscec Yi 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 F. Warren McFarlan, Donghong Li, Hong Zhang 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.
Sustainable margins compare to other players in Strategy & Execution industry
– CSCEC: Transformation and Development firm has clearly differentiated products in the market place. This has enabled Cscec Yi to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Cscec Yi to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Cscec Yi 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.
Innovation driven organization
– Cscec Yi is one of the most innovative firm in sector. Manager in CSCEC: Transformation and Development Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Highly skilled collaborators
– Cscec Yi 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 CSCEC: Transformation and Development HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Learning organization
- Cscec Yi 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 Cscec Yi is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in CSCEC: Transformation and Development Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Successful track record of launching new products
– Cscec Yi has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Cscec Yi 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.
Superior customer experience
– The customer experience strategy of Cscec Yi in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses CSCEC: Transformation and Development | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of CSCEC: Transformation and Development are -
High bargaining power of channel partners
– Because of the regulatory requirements, F. Warren McFarlan, Donghong Li, Hong Zhang suggests that, Cscec Yi 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study CSCEC: Transformation and Development, in the dynamic environment Cscec Yi has struggled to respond to the nimble upstart competition. Cscec Yi has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
No frontier risks strategy
– After analyzing the HBR case study CSCEC: Transformation and Development, 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.
Aligning sales with marketing
– It come across in the case study CSCEC: Transformation and Development 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 CSCEC: Transformation and Development can leverage the sales team experience to cultivate customer relationships as Cscec Yi is planning to shift buying processes online.
Increasing silos among functional specialists
– The organizational structure of Cscec Yi is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Cscec Yi needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Cscec Yi to focus more on services rather than just following the product oriented approach.
Low market penetration in new markets
– Outside its home market of Cscec Yi, firm in the HBR case study CSCEC: Transformation and Development needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Need for greater diversity
– Cscec Yi 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.
High cash cycle compare to competitors
Cscec Yi 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study CSCEC: Transformation and Development, is just above the industry average. Cscec Yi 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.
Slow to strategic competitive environment developments
– As CSCEC: Transformation and Development HBR case study mentions - Cscec Yi 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Cscec Yi is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study CSCEC: Transformation and Development can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities CSCEC: Transformation and Development | 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 CSCEC: Transformation and Development are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Cscec Yi 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.
Learning at scale
– Online learning technologies has now opened space for Cscec Yi 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Cscec Yi 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, Cscec Yi 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, CSCEC: Transformation and Development, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Cscec Yi can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Creating value in data economy
– The success of analytics program of Cscec Yi has opened avenues for new revenue streams for the organization in the industry. This can help Cscec Yi to build a more holistic ecosystem as suggested in the CSCEC: Transformation and Development case study. Cscec Yi can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Cscec Yi can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. CSCEC: Transformation and Development 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Cscec Yi is facing challenges because of the dominance of functional experts in the organization. CSCEC: Transformation and Development 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
– Cscec Yi 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 CSCEC: Transformation and Development - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Cscec Yi to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Loyalty marketing
– Cscec Yi 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.
Leveraging digital technologies
– Cscec Yi 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Cscec Yi can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Cscec Yi can use these opportunities to build new business models that can help the communities that Cscec Yi operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Threats CSCEC: Transformation and Development External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study CSCEC: Transformation and Development are -
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 Cscec Yi.
Regulatory challenges
– Cscec Yi 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.
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 Cscec Yi in the Strategy & Execution sector and impact the bottomline of the organization.
Environmental challenges
– Cscec Yi 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. Cscec Yi can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Shortening product life cycle
– it is one of the major threat that Cscec Yi is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
High dependence on third party suppliers
– Cscec Yi 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study CSCEC: Transformation and Development, Cscec Yi 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 .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Cscec Yi 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.
Consumer confidence and its impact on Cscec Yi 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.
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 Cscec Yi business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Cscec Yi 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Cscec Yi with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Technology acceleration in Forth Industrial Revolution
– Cscec Yi has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Cscec Yi 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.
Weighted SWOT Analysis of CSCEC: Transformation and Development 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 CSCEC: Transformation and Development 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 CSCEC: Transformation and Development 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 CSCEC: Transformation and Development 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 CSCEC: Transformation and Development 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 Cscec Yi needs to make to build a sustainable competitive advantage.