Jinjiang Group: Globalization Through State Ownership and Political Connection SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Jinjiang Group: Globalization Through State Ownership and Political Connection
Since its founding in 1951, Chinese state-owned Jinjiang International (Group) Company Limited (Jinjiang) had become a leading international company in the travel and hospitality industry with business divisions in hotels, transportation, travel, realty, investments, and finance. The Jinjiang brand was well-known in China, and the group had been pursuing a conservative investment approach. However, in response to the Chinese government's "Going Global" and "One Belt and One Road" policies, and in order to strengthen the firm's international competitiveness, Jinjiang made a series of aggressive mergers and acquisitions between 2014 and 2016. The acquisitions-especially those of two large hotel groups-had worsened Jinjiang's debt position, while integration was proving difficult due to the acquired firms' different corporate cultures and values. The hospitality market was also becoming mature and highly competitive; host-country governments were increasingly wary of foreign state-owned companies acquiring domestic assets. How could Jinjiang overcome these challenges to achieve its aspiration of building a world-class brand, while fulfilling the Chinese government's political agendas through a series of aggressive globalization efforts? Wiboon Kittilaksanawong is affiliated with Saitama University. Qiannan Shi is affiliated with Nagoya University of Commerce & Business.
Swot Analysis of "Jinjiang Group: Globalization Through State Ownership and Political Connection" written by Wiboon Kittilaksanawong, Qiannan Shi includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Jinjiang Hospitality facing as an external strategic factors. Some of the topics covered in Jinjiang Group: Globalization Through State Ownership and Political Connection case study are - Strategic Management Strategies, Globalization, Government and Global Business.
Some of the macro environment factors that can be used to understand the Jinjiang Group: Globalization Through State Ownership and Political Connection casestudy better are - – talent flight as more people leaving formal jobs, challanges to central banks by blockchain based private currencies, increasing government debt because of Covid-19 spendings, there is backlash against globalization, competitive advantages are harder to sustain because of technology dispersion, increasing transportation and logistics costs, digital marketing is dominated by two big players Facebook and Google,
increasing inequality as vast percentage of new income is going to the top 1%, wage bills are increasing, etc
Introduction to SWOT Analysis of Jinjiang Group: Globalization Through State Ownership and Political Connection
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Jinjiang Group: Globalization Through State Ownership and Political Connection case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Jinjiang Hospitality, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Jinjiang Hospitality 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 Jinjiang Group: Globalization Through State Ownership and Political Connection can be done for the following purposes –
1. Strategic planning using facts provided in Jinjiang Group: Globalization Through State Ownership and Political Connection case study
2. Improving business portfolio management of Jinjiang Hospitality
3. Assessing feasibility of the new initiative in Global Business field.
4. Making a Global Business topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Jinjiang Hospitality
Strengths Jinjiang Group: Globalization Through State Ownership and Political Connection | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Jinjiang Hospitality in Jinjiang Group: Globalization Through State Ownership and Political Connection Harvard Business Review case study are -
Analytics focus
– Jinjiang Hospitality 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 Wiboon Kittilaksanawong, Qiannan Shi 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.
High brand equity
– Jinjiang Hospitality has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Jinjiang Hospitality to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Effective Research and Development (R&D)
– Jinjiang Hospitality 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 Jinjiang Group: Globalization Through State Ownership and Political Connection - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Superior customer experience
– The customer experience strategy of Jinjiang Hospitality in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the Jinjiang Hospitality 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.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Jinjiang Hospitality digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Jinjiang Hospitality 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.
Operational resilience
– The operational resilience strategy in the Jinjiang Group: Globalization Through State Ownership and Political Connection 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.
Low bargaining power of suppliers
– Suppliers of Jinjiang Hospitality in the sector have low bargaining power. Jinjiang Group: Globalization Through State Ownership and Political Connection has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Jinjiang Hospitality to manage not only supply disruptions but also source products at highly competitive prices.
Successful track record of launching new products
– Jinjiang Hospitality has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Jinjiang Hospitality 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.
Sustainable margins compare to other players in Global Business industry
– Jinjiang Group: Globalization Through State Ownership and Political Connection firm has clearly differentiated products in the market place. This has enabled Jinjiang Hospitality to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Jinjiang Hospitality to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– Jinjiang Hospitality 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 Jinjiang Group: Globalization Through State Ownership and Political Connection HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High switching costs
– The high switching costs that Jinjiang Hospitality 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.
Weaknesses Jinjiang Group: Globalization Through State Ownership and Political Connection | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Jinjiang Group: Globalization Through State Ownership and Political Connection are -
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Jinjiang Group: Globalization Through State Ownership and Political Connection, is just above the industry average. Jinjiang Hospitality 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 decision making process
– As mentioned earlier in the report, Jinjiang Hospitality has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Jinjiang Hospitality even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Capital Spending Reduction
– Even during the low interest decade, Jinjiang Hospitality 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.
Slow to strategic competitive environment developments
– As Jinjiang Group: Globalization Through State Ownership and Political Connection HBR case study mentions - Jinjiang Hospitality 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 Jinjiang Group: Globalization Through State Ownership and Political Connection, it seems that the employees of Jinjiang Hospitality 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.
Interest costs
– Compare to the competition, Jinjiang Hospitality 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.
Lack of clear differentiation of Jinjiang Hospitality products
– To increase the profitability and margins on the products, Jinjiang Hospitality needs to provide more differentiated products than what it is currently offering in the marketplace.
Need for greater diversity
– Jinjiang Hospitality 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.
Aligning sales with marketing
– It come across in the case study Jinjiang Group: Globalization Through State Ownership and Political Connection 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 Jinjiang Group: Globalization Through State Ownership and Political Connection can leverage the sales team experience to cultivate customer relationships as Jinjiang Hospitality is planning to shift buying processes online.
Increasing silos among functional specialists
– The organizational structure of Jinjiang Hospitality is dominated by functional specialists. It is not different from other players in the Global Business segment. Jinjiang Hospitality needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Jinjiang Hospitality to focus more on services rather than just following the product oriented approach.
Skills based hiring
– The stress on hiring functional specialists at Jinjiang Hospitality 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.
Opportunities Jinjiang Group: Globalization Through State Ownership and Political Connection | 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 Jinjiang Group: Globalization Through State Ownership and Political Connection are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Jinjiang Hospitality in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Global Business segment, and it will provide faster access to the consumers.
Learning at scale
– Online learning technologies has now opened space for Jinjiang Hospitality 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.
Developing new processes and practices
– Jinjiang Hospitality can develop new processes and procedures in Global Business 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.
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 Jinjiang Hospitality 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.
Leveraging digital technologies
– Jinjiang Hospitality 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.
Building a culture of innovation
– managers at Jinjiang Hospitality 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 Global Business segment.
Creating value in data economy
– The success of analytics program of Jinjiang Hospitality has opened avenues for new revenue streams for the organization in the industry. This can help Jinjiang Hospitality to build a more holistic ecosystem as suggested in the Jinjiang Group: Globalization Through State Ownership and Political Connection case study. Jinjiang Hospitality can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Low interest rates
– Even though inflation is raising its head in most developed economies, Jinjiang Hospitality 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.
Manufacturing automation
– Jinjiang Hospitality can use the latest technology developments to improve its manufacturing and designing process in Global Business 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Global Business industry, but it has also influenced the consumer preferences. Jinjiang Hospitality can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Jinjiang Hospitality can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Buying journey improvements
– Jinjiang Hospitality can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Jinjiang Group: Globalization Through State Ownership and Political Connection 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.
Using analytics as competitive advantage
– Jinjiang Hospitality 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 Jinjiang Group: Globalization Through State Ownership and Political Connection - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Jinjiang Hospitality to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Jinjiang Group: Globalization Through State Ownership and Political Connection External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Jinjiang Group: Globalization Through State Ownership and Political Connection are -
Shortening product life cycle
– it is one of the major threat that Jinjiang Hospitality is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, 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 Jinjiang Group: Globalization Through State Ownership and Political Connection, Jinjiang Hospitality may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Global Business .
Regulatory challenges
– Jinjiang Hospitality 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 Global Business industry regulations.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Jinjiang Hospitality 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.
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 Jinjiang Hospitality business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Jinjiang Hospitality 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Jinjiang Hospitality 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 Jinjiang Group: Globalization Through State Ownership and Political Connection .
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 Jinjiang Hospitality.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Jinjiang Hospitality 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
– Jinjiang Hospitality has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Jinjiang Hospitality needs to keep up with the evolution of technology in the Global Business 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.
High dependence on third party suppliers
– Jinjiang Hospitality 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.
Environmental challenges
– Jinjiang Hospitality 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. Jinjiang Hospitality can take advantage of this fund but it will also bring new competitors in the Global Business industry.
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 Jinjiang Hospitality in the Global Business sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Jinjiang Group: Globalization Through State Ownership and Political Connection 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 Jinjiang Group: Globalization Through State Ownership and Political Connection 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 Jinjiang Group: Globalization Through State Ownership and Political Connection 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 Jinjiang Group: Globalization Through State Ownership and Political Connection 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 Jinjiang Group: Globalization Through State Ownership and Political Connection 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 Jinjiang Hospitality needs to make to build a sustainable competitive advantage.