Tiong Nam Logistics Holdings Bhd (TNTT) SWOT Analysis / TOWS Matrix / MBA Resources
Trucking
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Tiong Nam Logistics Holdings Bhd (Malaysia)
Based on various researches at Oak Spring University , Tiong Nam Logistics Holdings Bhd is operating in a macro-environment that has been destablized by – banking and financial system is disrupted by Bitcoin and other crypto currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, challanges to central banks by blockchain based private currencies, cloud computing is disrupting traditional business models, geopolitical disruptions, digital marketing is dominated by two big players Facebook and Google, increasing commodity prices,
supply chains are disrupted by pandemic , there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Tiong Nam Logistics Holdings Bhd
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Tiong Nam Logistics Holdings Bhd can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Tiong Nam Logistics Holdings Bhd, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Tiong Nam Logistics Holdings Bhd 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 Tiong Nam Logistics Holdings Bhd can be done for the following purposes –
1. Strategic planning of Tiong Nam Logistics Holdings Bhd
2. Improving business portfolio management of Tiong Nam Logistics Holdings Bhd
3. Assessing feasibility of the new initiative in Malaysia
4. Making a Trucking sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Tiong Nam Logistics Holdings Bhd
Strengths of Tiong Nam Logistics Holdings Bhd | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Tiong Nam Logistics Holdings Bhd are -
Strong track record of project management in the Trucking industry
– Tiong Nam Logistics Holdings Bhd is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Highly skilled collaborators
– Tiong Nam Logistics Holdings Bhd has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Trucking industry. Secondly the value chain collaborators of Tiong Nam Logistics Holdings Bhd have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– Tiong Nam Logistics Holdings Bhd has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Tiong Nam Logistics Holdings Bhd 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)
– Tiong Nam Logistics Holdings Bhd has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Tiong Nam Logistics Holdings Bhd staying ahead in the Trucking industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Digital Transformation in Trucking industry
- digital transformation varies from industry to industry. For Tiong Nam Logistics Holdings Bhd digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Tiong Nam Logistics Holdings Bhd 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.
Low bargaining power of suppliers
– Suppliers of Tiong Nam Logistics Holdings Bhd in the Transportation sector have low bargaining power. Tiong Nam Logistics Holdings Bhd has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Tiong Nam Logistics Holdings Bhd to manage not only supply disruptions but also source products at highly competitive prices.
Ability to lead change in Trucking
– Tiong Nam Logistics Holdings Bhd is one of the leading players in the Trucking industry in Malaysia. Over the years it has not only transformed the business landscape in the Trucking industry in Malaysia but also across the existing markets. The ability to lead change has enabled Tiong Nam Logistics Holdings Bhd in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Operational resilience
– The operational resilience strategy of Tiong Nam Logistics Holdings Bhd comprises – understanding the underlying the factors in the Trucking 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.
Training and development
– Tiong Nam Logistics Holdings Bhd has one of the best training and development program in Transportation 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.
Learning organization
- Tiong Nam Logistics Holdings Bhd 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 Tiong Nam Logistics Holdings Bhd is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Tiong Nam Logistics Holdings Bhd emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in Trucking industry
– Tiong Nam Logistics Holdings Bhd has clearly differentiated products in the market place. This has enabled Tiong Nam Logistics Holdings Bhd to fetch slight price premium compare to the competitors in the Trucking industry. The sustainable margins have also helped Tiong Nam Logistics Holdings Bhd to invest into research and development (R&D) and innovation.
High switching costs
– The high switching costs that Tiong Nam Logistics Holdings Bhd has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Weaknesses of Tiong Nam Logistics Holdings Bhd | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Tiong Nam Logistics Holdings Bhd are -
Skills based hiring in Trucking industry
– The stress on hiring functional specialists at Tiong Nam Logistics Holdings Bhd 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.
Capital Spending Reduction
– Even during the low interest decade, Tiong Nam Logistics Holdings Bhd 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 Trucking industry using digital technology.
Products dominated business model
– Even though Tiong Nam Logistics Holdings Bhd has some of the most successful models in the Trucking industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Tiong Nam Logistics Holdings Bhd should strive to include more intangible value offerings along with its core products and services.
No frontier risks strategy
– From the 10K / annual statement of Tiong Nam Logistics Holdings Bhd, it seems that company is thinking out the frontier risks that can impact Trucking industry. 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.
Ability to respond to the competition
– As the decision making is very deliberative at Tiong Nam Logistics Holdings Bhd, in the dynamic environment of Trucking industry it has struggled to respond to the nimble upstart competition. Tiong Nam Logistics Holdings Bhd has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow decision making process
– As mentioned earlier in the report, Tiong Nam Logistics Holdings Bhd has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Trucking industry over the last five years. Tiong Nam Logistics Holdings Bhd 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.
Need for greater diversity
– Tiong Nam Logistics Holdings Bhd 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.
Interest costs
– Compare to the competition, Tiong Nam Logistics Holdings Bhd 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.
High dependence on Tiong Nam Logistics Holdings Bhd ‘s star products
– The top 2 products and services of Tiong Nam Logistics Holdings Bhd still accounts for major business revenue. This dependence on star products in Trucking industry has resulted into insufficient focus on developing new products, even though Tiong Nam Logistics Holdings Bhd has relatively successful track record of launching new products.
Aligning sales with marketing
– From the outside it seems that Tiong Nam Logistics Holdings Bhd needs to have more collaboration between its sales team and marketing team. Sales professionals in the Trucking industry have deep experience in developing customer relationships. Marketing department at Tiong Nam Logistics Holdings Bhd can leverage the sales team experience to cultivate customer relationships as Tiong Nam Logistics Holdings Bhd is planning to shift buying processes online.
Slow to strategic competitive environment developments
– As Tiong Nam Logistics Holdings Bhd is one of the leading players in the Trucking industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Trucking industry in last five years.
Tiong Nam Logistics Holdings Bhd Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Tiong Nam Logistics Holdings Bhd are -
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. Tiong Nam Logistics Holdings Bhd can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Manufacturing automation
– Tiong Nam Logistics Holdings Bhd can use the latest technology developments to improve its manufacturing and designing process in Trucking 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Tiong Nam Logistics Holdings Bhd 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Tiong Nam Logistics Holdings Bhd 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 Tiong Nam Logistics Holdings Bhd to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Using analytics as competitive advantage
– Tiong Nam Logistics Holdings Bhd has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Trucking sector. This continuous investment in analytics has enabled Tiong Nam Logistics Holdings Bhd to build a competitive advantage using analytics. The analytics driven competitive advantage can help Tiong Nam Logistics Holdings Bhd to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Building a culture of innovation
– managers at Tiong Nam Logistics Holdings Bhd 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 Trucking industry.
Loyalty marketing
– Tiong Nam Logistics Holdings Bhd 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Tiong Nam Logistics Holdings Bhd can use these opportunities to build new business models that can help the communities that Tiong Nam Logistics Holdings Bhd operates in. Secondly it can use opportunities from government spending in Trucking sector.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Tiong Nam Logistics Holdings Bhd can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Developing new processes and practices
– Tiong Nam Logistics Holdings Bhd can develop new processes and procedures in Trucking 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Tiong Nam Logistics Holdings Bhd in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Trucking industry, and it will provide faster access to the consumers.
Better consumer reach
– The expansion of the 5G network will help Tiong Nam Logistics Holdings Bhd to increase its market reach. Tiong Nam Logistics Holdings Bhd 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.
Learning at scale
– Online learning technologies has now opened space for Tiong Nam Logistics Holdings Bhd 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.
Threats Tiong Nam Logistics Holdings Bhd External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Tiong Nam Logistics Holdings Bhd are -
Environmental challenges
– Tiong Nam Logistics Holdings Bhd 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. Tiong Nam Logistics Holdings Bhd can take advantage of this fund but it will also bring new competitors in the Trucking industry.
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 Tiong Nam Logistics Holdings Bhd.
Stagnating economy with rate increase
– Tiong Nam Logistics Holdings Bhd 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 Trucking industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Tiong Nam Logistics Holdings Bhd 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 Tiong Nam Logistics Holdings Bhd prominent markets.
Consumer confidence and its impact on Tiong Nam Logistics Holdings Bhd 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 Trucking industry and other sectors.
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. Tiong Nam Logistics Holdings Bhd 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.
Regulatory challenges
– Tiong Nam Logistics Holdings Bhd 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 Trucking industry regulations.
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.
Easy access to finance
– Easy access to finance in Trucking industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Tiong Nam Logistics Holdings Bhd 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 Tiong Nam Logistics Holdings Bhd
– 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 Tiong Nam Logistics Holdings Bhd.
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. Tiong Nam Logistics Holdings Bhd needs to understand the core reasons impacting the Trucking 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 Tiong Nam Logistics Holdings Bhd in Trucking industry. The Trucking 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
– Tiong Nam Logistics Holdings Bhd has witnessed rapid integration of technology during Covid-19 in the Trucking industry. As one of the leading players in the industry, Tiong Nam Logistics Holdings Bhd needs to keep up with the evolution of technology in the Trucking 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.
Weighted SWOT Analysis of Tiong Nam Logistics Holdings Bhd Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Tiong Nam Logistics Holdings Bhd 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 Tiong Nam Logistics Holdings Bhd 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 Tiong Nam Logistics Holdings Bhd 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 Tiong Nam Logistics Holdings Bhd 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 Tiong Nam Logistics Holdings Bhd needs to make to build a sustainable competitive advantage.