Based on various researches at Oak Spring University , Shanghai Qingpu Fire-Fighting is operating in a macro-environment that has been destablized by – there is backlash against globalization, technology disruption, increasing household debt because of falling income levels, increasing inequality as vast percentage of new income is going to the top 1%, competitive advantages are harder to sustain because of technology dispersion, digital marketing is dominated by two big players Facebook and Google, banking and financial system is disrupted by Bitcoin and other crypto currencies,
there is increasing trade war between United States & China, increasing energy prices, etc
Introduction to SWOT Analysis of Shanghai Qingpu Fire-Fighting
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Shanghai Qingpu Fire-Fighting can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Shanghai Qingpu Fire-Fighting, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Shanghai Qingpu Fire-Fighting 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 Shanghai Qingpu Fire-Fighting can be done for the following purposes –
1. Strategic planning of Shanghai Qingpu Fire-Fighting
2. Improving business portfolio management of Shanghai Qingpu Fire-Fighting
3. Assessing feasibility of the new initiative in Hong Kong
4. Making a Misc. Capital Goods sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Shanghai Qingpu Fire-Fighting
Strengths of Shanghai Qingpu Fire-Fighting | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Shanghai Qingpu Fire-Fighting are -
Low bargaining power of suppliers
– Suppliers of Shanghai Qingpu Fire-Fighting in the Capital Goods sector have low bargaining power. Shanghai Qingpu Fire-Fighting has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Shanghai Qingpu Fire-Fighting to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Shanghai Qingpu Fire-Fighting in Misc. Capital Goods industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High switching costs
– The high switching costs that Shanghai Qingpu Fire-Fighting 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.
Ability to recruit top talent
– Shanghai Qingpu Fire-Fighting is one of the leading players in the Misc. Capital Goods industry in Hong Kong. It is in a position to attract the best talent available in Hong Kong. The firm has a robust talent identification program that helps in identifying the brightest.
Organizational Resilience of Shanghai Qingpu Fire-Fighting
– The covid-19 pandemic has put organizational resilience at the centre of everthing Shanghai Qingpu Fire-Fighting does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Successful track record of launching new products
– Shanghai Qingpu Fire-Fighting has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Shanghai Qingpu Fire-Fighting 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.
Effective Research and Development (R&D)
– Shanghai Qingpu Fire-Fighting has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Shanghai Qingpu Fire-Fighting staying ahead in the Misc. Capital Goods industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Learning organization
- Shanghai Qingpu Fire-Fighting 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 Shanghai Qingpu Fire-Fighting is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Shanghai Qingpu Fire-Fighting emphasize – knowledge, initiative, and innovation.
Analytics focus
– Shanghai Qingpu Fire-Fighting 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 Misc. Capital Goods industry. The technology infrastructure of Hong Kong is also helping it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Training and development
– Shanghai Qingpu Fire-Fighting has one of the best training and development program in Capital Goods industry. The effectiveness of the training programs can be measured in – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Innovation driven organization
– Shanghai Qingpu Fire-Fighting is one of the most innovative firm in Misc. Capital Goods sector.
Operational resilience
– The operational resilience strategy of Shanghai Qingpu Fire-Fighting comprises – understanding the underlying the factors in the Misc. Capital Goods 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.
Weaknesses of Shanghai Qingpu Fire-Fighting | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Shanghai Qingpu Fire-Fighting are -
High cash cycle compare to competitors
Shanghai Qingpu Fire-Fighting has a high cash cycle compare to other players in the Misc. Capital Goods industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Compensation and incentives
– The revenue per employee of Shanghai Qingpu Fire-Fighting is just above the Misc. Capital Goods industry average. It 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.
Ability to respond to the competition
– As the decision making is very deliberative at Shanghai Qingpu Fire-Fighting, in the dynamic environment of Misc. Capital Goods industry it has struggled to respond to the nimble upstart competition. Shanghai Qingpu Fire-Fighting has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Skills based hiring in Misc. Capital Goods industry
– The stress on hiring functional specialists at Shanghai Qingpu Fire-Fighting 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.
Need for greater diversity
– Shanghai Qingpu Fire-Fighting 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
– From the outside it seems that Shanghai Qingpu Fire-Fighting needs to have more collaboration between its sales team and marketing team. Sales professionals in the Misc. Capital Goods industry have deep experience in developing customer relationships. Marketing department at Shanghai Qingpu Fire-Fighting can leverage the sales team experience to cultivate customer relationships as Shanghai Qingpu Fire-Fighting is planning to shift buying processes online.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Shanghai Qingpu Fire-Fighting supply chain. Even after few cautionary changes, Shanghai Qingpu Fire-Fighting is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Shanghai Qingpu Fire-Fighting vulnerable to further global disruptions in South East Asia.
Increasing silos among functional specialists
– The organizational structure of Shanghai Qingpu Fire-Fighting is dominated by functional specialists. It is not different from other players in the Misc. Capital Goods industry, but Shanghai Qingpu Fire-Fighting needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Shanghai Qingpu Fire-Fighting to focus more on services in the Misc. Capital Goods industry rather than just following the product oriented approach.
High dependence on Shanghai Qingpu Fire-Fighting ‘s star products
– The top 2 products and services of Shanghai Qingpu Fire-Fighting still accounts for major business revenue. This dependence on star products in Misc. Capital Goods industry has resulted into insufficient focus on developing new products, even though Shanghai Qingpu Fire-Fighting has relatively successful track record of launching new products.
Interest costs
– Compare to the competition, Shanghai Qingpu Fire-Fighting 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.
Capital Spending Reduction
– Even during the low interest decade, Shanghai Qingpu Fire-Fighting 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 Misc. Capital Goods industry using digital technology.
Shanghai Qingpu Fire-Fighting Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Shanghai Qingpu Fire-Fighting are -
Buying journey improvements
– Shanghai Qingpu Fire-Fighting can improve the customer journey of consumers in the Misc. Capital Goods industry by using analytics and artificial intelligence. It 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Misc. Capital Goods industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Shanghai Qingpu Fire-Fighting 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. Shanghai Qingpu Fire-Fighting 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.
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 Shanghai Qingpu Fire-Fighting 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Shanghai Qingpu Fire-Fighting 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.
Learning at scale
– Online learning technologies has now opened space for Shanghai Qingpu Fire-Fighting 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.
Loyalty marketing
– Shanghai Qingpu Fire-Fighting 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Misc. Capital Goods industry, but it has also influenced the consumer preferences. Shanghai Qingpu Fire-Fighting can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Manufacturing automation
– Shanghai Qingpu Fire-Fighting can use the latest technology developments to improve its manufacturing and designing process in Misc. Capital Goods sector. 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
– Shanghai Qingpu Fire-Fighting can develop new processes and procedures in Misc. Capital Goods 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.
Creating value in data economy
– The success of analytics program of Shanghai Qingpu Fire-Fighting has opened avenues for new revenue streams for the organization in Misc. Capital Goods industry. This can help Shanghai Qingpu Fire-Fighting to build a more holistic ecosystem for Shanghai Qingpu Fire-Fighting products in the Misc. Capital Goods industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Shanghai Qingpu Fire-Fighting can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Leveraging digital technologies
– Shanghai Qingpu Fire-Fighting 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Shanghai Qingpu Fire-Fighting 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 Shanghai Qingpu Fire-Fighting to hire the very best people irrespective of their geographical location.
Threats Shanghai Qingpu Fire-Fighting External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Shanghai Qingpu Fire-Fighting are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Shanghai Qingpu Fire-Fighting 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 Shanghai Qingpu Fire-Fighting prominent markets.
Shortening product life cycle
– it is one of the major threat that Shanghai Qingpu Fire-Fighting is facing in Misc. Capital Goods sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, 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.
Consumer confidence and its impact on Shanghai Qingpu Fire-Fighting 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 Misc. Capital Goods industry and other sectors.
Easy access to finance
– Easy access to finance in Misc. Capital Goods industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Shanghai Qingpu Fire-Fighting can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Misc. Capital Goods industry are lowering. It can presents Shanghai Qingpu Fire-Fighting with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Misc. Capital Goods sector.
High dependence on third party suppliers
– Shanghai Qingpu Fire-Fighting 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.
Stagnating economy with rate increase
– Shanghai Qingpu Fire-Fighting 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 Misc. Capital Goods industry.
Regulatory challenges
– Shanghai Qingpu Fire-Fighting 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 Misc. Capital Goods 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. Shanghai Qingpu Fire-Fighting will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Shanghai Qingpu Fire-Fighting may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Misc. Capital Goods sector.
Increasing wage structure of Shanghai Qingpu Fire-Fighting
– 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 Shanghai Qingpu Fire-Fighting.
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 Shanghai Qingpu Fire-Fighting business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of Shanghai Qingpu Fire-Fighting Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Shanghai Qingpu Fire-Fighting 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 Shanghai Qingpu Fire-Fighting 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 Shanghai Qingpu Fire-Fighting 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 Shanghai Qingpu Fire-Fighting 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 Shanghai Qingpu Fire-Fighting needs to make to build a sustainable competitive advantage.