As part of its expansion and diversification strategy, the Chiaphua Group explored real estate investments in emerging markets. The Group was one of the largest privately held company groups based in Hong Kong, with international investments in a variety of manufacturing and property development. A family member, Raymond Cheng, had narrowed the list of potential markets to Singapore, Malaysia, Indonesia, and Vietnam. Notwithstanding a history of instability and conflict and substantial government control of markets, Raymond concluded that Vietnam was the best option. Revolves around how to assess the market in the absence of hard data, and what would be the appropriate entry points. Illuminates how relationship-driven investments can be the foundation of a long-term investment strategy. Issues also involve how, by working with government through a structured forum (along with personal relations), laws and regulations can evolve to facilitate real estate investments.
Authors :: Nicolas P. Retsinas, Michael Shih-ta Chen
Swot Analysis of "Chiaphua Group Vietnam" written by Nicolas P. Retsinas, Michael Shih-ta Chen includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Chiaphua Vietnam facing as an external strategic factors. Some of the topics covered in Chiaphua Group Vietnam case study are - Strategic Management Strategies, and Global Business.
Some of the macro environment factors that can be used to understand the Chiaphua Group Vietnam casestudy better are - – increasing household debt because of falling income levels, geopolitical disruptions, there is backlash against globalization, talent flight as more people leaving formal jobs, wage bills are increasing, increasing inequality as vast percentage of new income is going to the top 1%, increasing commodity prices,
increasing government debt because of Covid-19 spendings, technology disruption, etc
Introduction to SWOT Analysis of Chiaphua Group Vietnam
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Chiaphua Group Vietnam case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Chiaphua Vietnam, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Chiaphua Vietnam 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 Chiaphua Group Vietnam can be done for the following purposes –
1. Strategic planning using facts provided in Chiaphua Group Vietnam case study
2. Improving business portfolio management of Chiaphua Vietnam
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 Chiaphua Vietnam
Strengths Chiaphua Group Vietnam | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Chiaphua Vietnam in Chiaphua Group Vietnam Harvard Business Review case study are -
Analytics focus
– Chiaphua Vietnam 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 Nicolas P. Retsinas, Michael Shih-ta 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.
Effective Research and Development (R&D)
– Chiaphua Vietnam 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 Chiaphua Group Vietnam - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Learning organization
- Chiaphua Vietnam 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 Chiaphua Vietnam is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Chiaphua Group Vietnam Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Chiaphua Vietnam 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.
Organizational Resilience of Chiaphua Vietnam
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Chiaphua Vietnam does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High brand equity
– Chiaphua Vietnam has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Chiaphua Vietnam to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– Chiaphua Vietnam is one of the most innovative firm in sector. Manager in Chiaphua Group Vietnam 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
– Chiaphua Vietnam has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Chiaphua Vietnam 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.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Chiaphua Vietnam digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Chiaphua Vietnam 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.
Strong track record of project management
– Chiaphua Vietnam is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Sustainable margins compare to other players in Global Business industry
– Chiaphua Group Vietnam firm has clearly differentiated products in the market place. This has enabled Chiaphua Vietnam to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Chiaphua Vietnam to invest into research and development (R&D) and innovation.
Low bargaining power of suppliers
– Suppliers of Chiaphua Vietnam in the sector have low bargaining power. Chiaphua Group Vietnam has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Chiaphua Vietnam to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses Chiaphua Group Vietnam | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Chiaphua Group Vietnam are -
Slow to strategic competitive environment developments
– As Chiaphua Group Vietnam HBR case study mentions - Chiaphua Vietnam 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 Chiaphua Group Vietnam, it seems that the employees of Chiaphua Vietnam 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.
Products dominated business model
– Even though Chiaphua Vietnam 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 - Chiaphua Group Vietnam should strive to include more intangible value offerings along with its core products and services.
Workers concerns about automation
– As automation is fast increasing in the segment, Chiaphua Vietnam 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Chiaphua Vietnam is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Chiaphua Group Vietnam can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Chiaphua Group Vietnam, is just above the industry average. Chiaphua Vietnam 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.
Need for greater diversity
– Chiaphua Vietnam 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 operating costs
– Compare to the competitors, firm in the HBR case study Chiaphua Group Vietnam 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 Chiaphua Vietnam 's lucrative customers.
Low market penetration in new markets
– Outside its home market of Chiaphua Vietnam, firm in the HBR case study Chiaphua Group Vietnam needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow decision making process
– As mentioned earlier in the report, Chiaphua Vietnam 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. Chiaphua Vietnam 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Nicolas P. Retsinas, Michael Shih-ta Chen suggests that, Chiaphua Vietnam 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.
Opportunities Chiaphua Group Vietnam | 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 Chiaphua Group Vietnam are -
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Global Business industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Chiaphua Vietnam 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. Chiaphua Vietnam 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Chiaphua Vietnam can use these opportunities to build new business models that can help the communities that Chiaphua Vietnam operates in. Secondly it can use opportunities from government spending in Global Business sector.
Low interest rates
– Even though inflation is raising its head in most developed economies, Chiaphua Vietnam 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Chiaphua Vietnam 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 Chiaphua Vietnam to hire the very best people irrespective of their geographical location.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Chiaphua Vietnam 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, Chiaphua Group Vietnam, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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 Chiaphua Vietnam in the consumer business. Now Chiaphua Vietnam can target international markets with far fewer capital restrictions requirements than the existing system.
Manufacturing automation
– Chiaphua Vietnam 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.
Developing new processes and practices
– Chiaphua Vietnam 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.
Leveraging digital technologies
– Chiaphua Vietnam 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 Chiaphua Vietnam has opened avenues for new revenue streams for the organization in the industry. This can help Chiaphua Vietnam to build a more holistic ecosystem as suggested in the Chiaphua Group Vietnam case study. Chiaphua Vietnam can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at Chiaphua Vietnam 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.
Buying journey improvements
– Chiaphua Vietnam can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Chiaphua Group Vietnam 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.
Loyalty marketing
– Chiaphua Vietnam 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.
Threats Chiaphua Group Vietnam External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Chiaphua Group Vietnam are -
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. Chiaphua Vietnam needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Chiaphua Vietnam in the Global Business industry. The Global Business 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.
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.
Shortening product life cycle
– it is one of the major threat that Chiaphua Vietnam is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Chiaphua Vietnam 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Chiaphua Vietnam 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 Chiaphua Group Vietnam .
Increasing wage structure of Chiaphua Vietnam
– 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 Chiaphua Vietnam.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Chiaphua Vietnam with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Easy access to finance
– Easy access to finance in Global Business field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Chiaphua Vietnam can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
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 Chiaphua Vietnam.
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 Chiaphua Vietnam in the Global Business sector and impact the bottomline of the organization.
Environmental challenges
– Chiaphua Vietnam 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. Chiaphua Vietnam can take advantage of this fund but it will also bring new competitors in the Global Business industry.
Weighted SWOT Analysis of Chiaphua Group Vietnam 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 Chiaphua Group Vietnam 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 Chiaphua Group Vietnam 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 Chiaphua Group Vietnam 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 Chiaphua Group Vietnam 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 Chiaphua Vietnam needs to make to build a sustainable competitive advantage.