Wenzhou Kangning Hospital: Changing Mental Healthcare in China SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Wenzhou Kangning Hospital: Changing Mental Healthcare in China
The city of Wenzhou in the Province of Zhejiang, long known in China for entrepreneurship, now hosts the country's largest privately owned mental health hospital group. This case traces the development of Wenzhou Kangning Hospital Co, Ltd. from founding to just before its initial public offering to illustrate the extraordinary entrepreneurship happening in China's healthcare space. It highlights the challenges of China's mental health sector and the means company founder Guan Weili employed to address some of them. How will the hospital grow in the future?
Authors :: William C. Kirby, Wei Zhang, Yuanzhuo Wang, Nancy Hua Dai
Swot Analysis of "Wenzhou Kangning Hospital: Changing Mental Healthcare in China" written by William C. Kirby, Wei Zhang, Yuanzhuo Wang, Nancy Hua Dai includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Wenzhou Kangning facing as an external strategic factors. Some of the topics covered in Wenzhou Kangning Hospital: Changing Mental Healthcare in China case study are - Strategic Management Strategies, Government, Health, IPO and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Wenzhou Kangning Hospital: Changing Mental Healthcare in China casestudy better are - – increasing household debt because of falling income levels, challanges to central banks by blockchain based private currencies, increasing commodity prices, customer relationship management is fast transforming because of increasing concerns over data privacy, there is increasing trade war between United States & China, central banks are concerned over increasing inflation, increasing energy prices,
there is backlash against globalization, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of Wenzhou Kangning Hospital: Changing Mental Healthcare in China
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Wenzhou Kangning Hospital: Changing Mental Healthcare in China case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Wenzhou Kangning, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Wenzhou Kangning 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 Wenzhou Kangning Hospital: Changing Mental Healthcare in China can be done for the following purposes –
1. Strategic planning using facts provided in Wenzhou Kangning Hospital: Changing Mental Healthcare in China case study
2. Improving business portfolio management of Wenzhou Kangning
3. Assessing feasibility of the new initiative in Leadership & Managing People field.
4. Making a Leadership & Managing People topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Wenzhou Kangning
Strengths Wenzhou Kangning Hospital: Changing Mental Healthcare in China | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Wenzhou Kangning in Wenzhou Kangning Hospital: Changing Mental Healthcare in China Harvard Business Review case study are -
Organizational Resilience of Wenzhou Kangning
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Wenzhou Kangning does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Cross disciplinary teams
– Horizontal connected teams at the Wenzhou Kangning 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.
Superior customer experience
– The customer experience strategy of Wenzhou Kangning in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to lead change in Leadership & Managing People field
– Wenzhou Kangning 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 Wenzhou Kangning in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Training and development
– Wenzhou Kangning has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Wenzhou Kangning Hospital: Changing Mental Healthcare in China 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.
Strong track record of project management
– Wenzhou Kangning is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High switching costs
– The high switching costs that Wenzhou Kangning 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.
Effective Research and Development (R&D)
– Wenzhou Kangning 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 Wenzhou Kangning Hospital: Changing Mental Healthcare in China - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Highly skilled collaborators
– Wenzhou Kangning 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 Wenzhou Kangning Hospital: Changing Mental Healthcare in China HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– Wenzhou Kangning has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Wenzhou Kangning 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 Leadership & Managing People industry
– Wenzhou Kangning Hospital: Changing Mental Healthcare in China firm has clearly differentiated products in the market place. This has enabled Wenzhou Kangning to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Wenzhou Kangning to invest into research and development (R&D) and innovation.
Learning organization
- Wenzhou Kangning 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 Wenzhou Kangning is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Wenzhou Kangning Hospital: Changing Mental Healthcare in China Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses Wenzhou Kangning Hospital: Changing Mental Healthcare in China | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Wenzhou Kangning Hospital: Changing Mental Healthcare in China are -
Workers concerns about automation
– As automation is fast increasing in the segment, Wenzhou Kangning 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Wenzhou Kangning Hospital: Changing Mental Healthcare in China, in the dynamic environment Wenzhou Kangning has struggled to respond to the nimble upstart competition. Wenzhou Kangning has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Aligning sales with marketing
– It come across in the case study Wenzhou Kangning Hospital: Changing Mental Healthcare in China 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 Wenzhou Kangning Hospital: Changing Mental Healthcare in China can leverage the sales team experience to cultivate customer relationships as Wenzhou Kangning is planning to shift buying processes online.
No frontier risks strategy
– After analyzing the HBR case study Wenzhou Kangning Hospital: Changing Mental Healthcare in China, it seems that company is thinking about the frontier risks that can impact Leadership & Managing People 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 harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Wenzhou Kangning is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Wenzhou Kangning Hospital: Changing Mental Healthcare in China 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 bargaining power of channel partners
– Because of the regulatory requirements, William C. Kirby, Wei Zhang, Yuanzhuo Wang, Nancy Hua Dai suggests that, Wenzhou Kangning 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.
Slow decision making process
– As mentioned earlier in the report, Wenzhou Kangning 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. Wenzhou Kangning 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.
Slow to strategic competitive environment developments
– As Wenzhou Kangning Hospital: Changing Mental Healthcare in China HBR case study mentions - Wenzhou Kangning 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.
Products dominated business model
– Even though Wenzhou Kangning has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Wenzhou Kangning Hospital: Changing Mental Healthcare in China should strive to include more intangible value offerings along with its core products and services.
Lack of clear differentiation of Wenzhou Kangning products
– To increase the profitability and margins on the products, Wenzhou Kangning needs to provide more differentiated products than what it is currently offering in the marketplace.
High operating costs
– Compare to the competitors, firm in the HBR case study Wenzhou Kangning Hospital: Changing Mental Healthcare in China 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 Wenzhou Kangning 's lucrative customers.
Opportunities Wenzhou Kangning Hospital: Changing Mental Healthcare in China | 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 Wenzhou Kangning Hospital: Changing Mental Healthcare in China are -
Manufacturing automation
– Wenzhou Kangning can use the latest technology developments to improve its manufacturing and designing process in Leadership & Managing People 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.
Using analytics as competitive advantage
– Wenzhou Kangning 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 Wenzhou Kangning Hospital: Changing Mental Healthcare in China - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Wenzhou Kangning to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Leadership & Managing People industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Wenzhou Kangning 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. Wenzhou Kangning 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.
Building a culture of innovation
– managers at Wenzhou Kangning 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 Leadership & Managing People segment.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Wenzhou Kangning can use these opportunities to build new business models that can help the communities that Wenzhou Kangning operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Creating value in data economy
– The success of analytics program of Wenzhou Kangning has opened avenues for new revenue streams for the organization in the industry. This can help Wenzhou Kangning to build a more holistic ecosystem as suggested in the Wenzhou Kangning Hospital: Changing Mental Healthcare in China case study. Wenzhou Kangning can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Wenzhou Kangning in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Leadership & Managing People segment, and it will provide faster access to the consumers.
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 Wenzhou Kangning in the consumer business. Now Wenzhou Kangning can target international markets with far fewer capital restrictions requirements than the existing system.
Loyalty marketing
– Wenzhou Kangning 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, Wenzhou Kangning 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, Wenzhou Kangning Hospital: Changing Mental Healthcare in China, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Leveraging digital technologies
– Wenzhou Kangning 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.
Learning at scale
– Online learning technologies has now opened space for Wenzhou Kangning 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, Wenzhou Kangning 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.
Threats Wenzhou Kangning Hospital: Changing Mental Healthcare in China External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Wenzhou Kangning Hospital: Changing Mental Healthcare in China are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Wenzhou Kangning with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Stagnating economy with rate increase
– Wenzhou Kangning 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.
Easy access to finance
– Easy access to finance in Leadership & Managing People field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Wenzhou Kangning can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing wage structure of Wenzhou Kangning
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Wenzhou Kangning.
Environmental challenges
– Wenzhou Kangning 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. Wenzhou Kangning can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Consumer confidence and its impact on Wenzhou Kangning 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 Wenzhou Kangning.
Shortening product life cycle
– it is one of the major threat that Wenzhou Kangning is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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.
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 Wenzhou Kangning business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Wenzhou Kangning 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.
Technology acceleration in Forth Industrial Revolution
– Wenzhou Kangning has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Wenzhou Kangning needs to keep up with the evolution of technology in the Leadership & Managing People 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 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. Wenzhou Kangning needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Weighted SWOT Analysis of Wenzhou Kangning Hospital: Changing Mental Healthcare in China 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 Wenzhou Kangning Hospital: Changing Mental Healthcare in China 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 Wenzhou Kangning Hospital: Changing Mental Healthcare in China 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 Wenzhou Kangning Hospital: Changing Mental Healthcare in China 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 Wenzhou Kangning Hospital: Changing Mental Healthcare in China 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 Wenzhou Kangning needs to make to build a sustainable competitive advantage.