Kunshan, Incorporated: The Making of China's Richest Town SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Kunshan, Incorporated: The Making of China's Richest Town
In 1980, the city of Kunshan was mere countryside, registering neither on the Chinese government's nor the international business community's radar. By 2010, Kunshan had become the richest city per capita in China and a global technology powerhouse, home to companies such as Foxconn, Compal Electronics, and Wistron. Kunshan's entrepreneurial, self-starting development combined with strategic location and high levels of local government support had been responsible for Kunshan's tremendous growth and success. How could it continue to grow at a rate to maintain its leadership among Chinese entrepreneurial cities? And would the founding of an international, joint-venture campus with Duke and Wuhan University keep the city of Kunshan innovative and ahead of the curve?
Authors :: William C. Kirby, Nora Bynum, Tracy Yuen Manty, Erica M Zendell
Swot Analysis of "Kunshan, Incorporated: The Making of China's Richest Town" written by William C. Kirby, Nora Bynum, Tracy Yuen Manty, Erica M Zendell includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Kunshan Kunshan's facing as an external strategic factors. Some of the topics covered in Kunshan, Incorporated: The Making of China's Richest Town case study are - Strategic Management Strategies, Cross-cultural management, Emerging markets, Entrepreneurship, Financial management, Global strategy, Government, Innovation, Leadership, Technology and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Kunshan, Incorporated: The Making of China's Richest Town casestudy better are - – competitive advantages are harder to sustain because of technology dispersion, central banks are concerned over increasing inflation, increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing energy prices, banking and financial system is disrupted by Bitcoin and other crypto currencies,
cloud computing is disrupting traditional business models, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Kunshan, Incorporated: The Making of China's Richest Town
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Kunshan, Incorporated: The Making of China's Richest Town case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Kunshan Kunshan's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Kunshan Kunshan's 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 Kunshan, Incorporated: The Making of China's Richest Town can be done for the following purposes –
1. Strategic planning using facts provided in Kunshan, Incorporated: The Making of China's Richest Town case study
2. Improving business portfolio management of Kunshan Kunshan's
3. Assessing feasibility of the new initiative in Innovation & Entrepreneurship field.
4. Making a Innovation & Entrepreneurship topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Kunshan Kunshan's
Strengths Kunshan, Incorporated: The Making of China's Richest Town | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Kunshan Kunshan's in Kunshan, Incorporated: The Making of China's Richest Town Harvard Business Review case study are -
Ability to lead change in Innovation & Entrepreneurship field
– Kunshan Kunshan's 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 Kunshan Kunshan's in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Learning organization
- Kunshan Kunshan's 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 Kunshan Kunshan's is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Kunshan, Incorporated: The Making of China's Richest Town Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– Kunshan Kunshan's is one of the most innovative firm in sector. Manager in Kunshan, Incorporated: The Making of China's Richest Town Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Highly skilled collaborators
– Kunshan Kunshan's 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 Kunshan, Incorporated: The Making of China's Richest Town HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Operational resilience
– The operational resilience strategy in the Kunshan, Incorporated: The Making of China's Richest Town 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.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– Kunshan, Incorporated: The Making of China's Richest Town firm has clearly differentiated products in the market place. This has enabled Kunshan Kunshan's to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Kunshan Kunshan's to invest into research and development (R&D) and innovation.
Effective Research and Development (R&D)
– Kunshan Kunshan's 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 Kunshan, Incorporated: The Making of China's Richest Town - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to recruit top talent
– Kunshan Kunshan's is one of the leading recruiters in the industry. Managers in the Kunshan, Incorporated: The Making of China's Richest Town are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Training and development
– Kunshan Kunshan's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Kunshan, Incorporated: The Making of China's Richest Town 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.
Digital Transformation in Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Kunshan Kunshan's digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Kunshan Kunshan's 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.
Diverse revenue streams
– Kunshan Kunshan's is present in almost all the verticals within the industry. This has provided firm in Kunshan, Incorporated: The Making of China's Richest Town case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Analytics focus
– Kunshan Kunshan's 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 William C. Kirby, Nora Bynum, Tracy Yuen Manty, Erica M Zendell 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.
Weaknesses Kunshan, Incorporated: The Making of China's Richest Town | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Kunshan, Incorporated: The Making of China's Richest Town are -
High cash cycle compare to competitors
Kunshan Kunshan's 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Kunshan, Incorporated: The Making of China's Richest Town 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 Kunshan Kunshan's has relatively successful track record of launching new products.
Low market penetration in new markets
– Outside its home market of Kunshan Kunshan's, firm in the HBR case study Kunshan, Incorporated: The Making of China's Richest Town needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Workers concerns about automation
– As automation is fast increasing in the segment, Kunshan Kunshan's 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Kunshan, Incorporated: The Making of China's Richest Town, it seems that the employees of Kunshan Kunshan's 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.
High bargaining power of channel partners
– Because of the regulatory requirements, William C. Kirby, Nora Bynum, Tracy Yuen Manty, Erica M Zendell suggests that, Kunshan Kunshan's 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.
Need for greater diversity
– Kunshan Kunshan's 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.
Increasing silos among functional specialists
– The organizational structure of Kunshan Kunshan's is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Kunshan Kunshan's needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Kunshan Kunshan's to focus more on services rather than just following the product oriented approach.
Aligning sales with marketing
– It come across in the case study Kunshan, Incorporated: The Making of China's Richest Town 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 Kunshan, Incorporated: The Making of China's Richest Town can leverage the sales team experience to cultivate customer relationships as Kunshan Kunshan's is planning to shift buying processes online.
Skills based hiring
– The stress on hiring functional specialists at Kunshan Kunshan's 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Kunshan Kunshan's is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Kunshan, Incorporated: The Making of China's Richest Town can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities Kunshan, Incorporated: The Making of China's Richest Town | 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 Kunshan, Incorporated: The Making of China's Richest Town are -
Using analytics as competitive advantage
– Kunshan Kunshan's 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 Kunshan, Incorporated: The Making of China's Richest Town - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Kunshan Kunshan's to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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 Kunshan Kunshan's 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Kunshan Kunshan's 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 Kunshan Kunshan's to hire the very best people irrespective of their geographical location.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Kunshan Kunshan's 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. Kunshan Kunshan's can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Kunshan Kunshan's 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, Kunshan, Incorporated: The Making of China's Richest Town, 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 Kunshan Kunshan's to increase its market reach. Kunshan Kunshan's 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, Kunshan Kunshan's can use these opportunities to build new business models that can help the communities that Kunshan Kunshan's operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Loyalty marketing
– Kunshan Kunshan's 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.
Creating value in data economy
– The success of analytics program of Kunshan Kunshan's has opened avenues for new revenue streams for the organization in the industry. This can help Kunshan Kunshan's to build a more holistic ecosystem as suggested in the Kunshan, Incorporated: The Making of China's Richest Town case study. Kunshan Kunshan's can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Kunshan Kunshan's can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Kunshan, Incorporated: The Making of China's Richest Town 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.
Developing new processes and practices
– Kunshan Kunshan's can develop new processes and procedures in Innovation & Entrepreneurship 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.
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 Kunshan Kunshan's in the consumer business. Now Kunshan Kunshan's can target international markets with far fewer capital restrictions requirements than the existing system.
Threats Kunshan, Incorporated: The Making of China's Richest Town External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Kunshan, Incorporated: The Making of China's Richest Town are -
Increasing wage structure of Kunshan Kunshan's
– 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 Kunshan Kunshan's.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Kunshan Kunshan's in the Innovation & Entrepreneurship industry. The Innovation & Entrepreneurship 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.
Technology acceleration in Forth Industrial Revolution
– Kunshan Kunshan's has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Kunshan Kunshan's needs to keep up with the evolution of technology in the Innovation & Entrepreneurship 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. Kunshan Kunshan's needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.
Regulatory challenges
– Kunshan Kunshan's 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 Innovation & Entrepreneurship industry regulations.
Easy access to finance
– Easy access to finance in Innovation & Entrepreneurship field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Kunshan Kunshan's can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Kunshan Kunshan's in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Environmental challenges
– Kunshan Kunshan's 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. Kunshan Kunshan's can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
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.
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 Kunshan Kunshan's.
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 Kunshan Kunshan's business can come under increasing regulations regarding data privacy, data security, etc.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Kunshan, Incorporated: The Making of China's Richest Town, Kunshan Kunshan's may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Innovation & Entrepreneurship .
Weighted SWOT Analysis of Kunshan, Incorporated: The Making of China's Richest Town 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 Kunshan, Incorporated: The Making of China's Richest Town 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 Kunshan, Incorporated: The Making of China's Richest Town 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 Kunshan, Incorporated: The Making of China's Richest Town 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 Kunshan, Incorporated: The Making of China's Richest Town 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 Kunshan Kunshan's needs to make to build a sustainable competitive advantage.