Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study SWOT Analysis Solution
Case Study Description of Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation
As a well-established Chinese garment brand, Yangtzekiang Garment Limited (YGM) and its related retail business, YGM Trading Limited, faced the challenges of a labour shortage, stagnant productivity, and the transformation of the traditional garment industry. As China was rapidly developing, Chinese companies were facing new challenges and needed to consider strategies to ensure more sustainable development. In March 2015, the executive chairman of YGM needed to transform the company and develop a sustainable strategy of innovation and transformation that would lead it forward in these new circumstances.
Swot Analysis of "Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation" written by Jianping Liang, Hubert Pun, Jing Chen includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Ygm Garment facing as an external strategic factors. Some of the topics covered in Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation case study are - Strategic Management Strategies, Innovation, Manufacturing and Technology & Operations.
Some of the macro environment factors that can be used to understand the Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation casestudy better are - – supply chains are disrupted by pandemic , increasing inequality as vast percentage of new income is going to the top 1%, technology disruption, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing energy prices, talent flight as more people leaving formal jobs, challanges to central banks by blockchain based private currencies,
banking and financial system is disrupted by Bitcoin and other crypto currencies, geopolitical disruptions, etc
Introduction to SWOT Analysis of Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Ygm Garment, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Ygm Garment 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 Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation can be done for the following purposes –
1. Strategic planning using facts provided in Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation case study
2. Improving business portfolio management of Ygm Garment
3. Assessing feasibility of the new initiative in Technology & Operations field.
4. Making a Technology & Operations topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Ygm Garment
Strengths Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Ygm Garment in Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation Harvard Business Review case study are -
Superior customer experience
– The customer experience strategy of Ygm Garment in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– Ygm Garment has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation 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.
Ability to recruit top talent
– Ygm Garment is one of the leading recruiters in the industry. Managers in the Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation 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
– Ygm Garment has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Ygm Garment to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Analytics focus
– Ygm Garment 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 Jianping Liang, Hubert Pun, Jing Chen 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.
Innovation driven organization
– Ygm Garment is one of the most innovative firm in sector. Manager in Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Successful track record of launching new products
– Ygm Garment has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Ygm Garment 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.
Operational resilience
– The operational resilience strategy in the Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation 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.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Ygm Garment digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Ygm Garment 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 switching costs
– The high switching costs that Ygm Garment 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.
Highly skilled collaborators
– Ygm Garment 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 Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Learning organization
- Ygm Garment 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 Ygm Garment is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation are -
High operating costs
– Compare to the competitors, firm in the HBR case study Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation 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 Ygm Garment 's lucrative customers.
Low market penetration in new markets
– Outside its home market of Ygm Garment, firm in the HBR case study Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Interest costs
– Compare to the competition, Ygm Garment 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.
High cash cycle compare to competitors
Ygm Garment 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.
Capital Spending Reduction
– Even during the low interest decade, Ygm Garment 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Ygm Garment 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation, is just above the industry average. Ygm Garment 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.
Increasing silos among functional specialists
– The organizational structure of Ygm Garment is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Ygm Garment needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Ygm Garment to focus more on services rather than just following the product oriented approach.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Ygm Garment is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Ygm Garment has relatively successful track record of launching new products.
Need for greater diversity
– Ygm Garment 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.
Opportunities Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation | 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 Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation are -
Loyalty marketing
– Ygm Garment 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Ygm Garment 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, Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Better consumer reach
– The expansion of the 5G network will help Ygm Garment to increase its market reach. Ygm Garment 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Ygm Garment can use these opportunities to build new business models that can help the communities that Ygm Garment operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Ygm Garment 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 Ygm Garment 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 Technology & Operations industry, but it has also influenced the consumer preferences. Ygm Garment can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Developing new processes and practices
– Ygm Garment can develop new processes and procedures in Technology & Operations 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.
Using analytics as competitive advantage
– Ygm Garment 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 Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Ygm Garment to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Leveraging digital technologies
– Ygm Garment 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.
Creating value in data economy
– The success of analytics program of Ygm Garment has opened avenues for new revenue streams for the organization in the industry. This can help Ygm Garment to build a more holistic ecosystem as suggested in the Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation case study. Ygm Garment can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Ygm Garment is facing challenges because of the dominance of functional experts in the organization. Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Ygm Garment can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Ygm Garment can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation are -
Stagnating economy with rate increase
– Ygm Garment 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.
Environmental challenges
– Ygm Garment 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. Ygm Garment can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
Consumer confidence and its impact on Ygm Garment 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.
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.
High dependence on third party suppliers
– Ygm Garment 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.
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. Ygm Garment 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation, Ygm Garment may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Technology & Operations .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Ygm Garment in the Technology & Operations industry. The Technology & Operations 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.
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. Ygm Garment needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Ygm Garment with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Ygm Garment business can come under increasing regulations regarding data privacy, data security, etc.
Technology acceleration in Forth Industrial Revolution
– Ygm Garment has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Ygm Garment needs to keep up with the evolution of technology in the Technology & Operations 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 Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation 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 Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation 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 Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation 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 Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation 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 Yangtzekiang Garment Group Company: Challenges and Opportunities in Transformation 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 Ygm Garment needs to make to build a sustainable competitive advantage.
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