Hutchison Port Holdings Trust (HPHT) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Hutchison Port Holdings Trust (Singapore)

Based on various researches at Oak Spring University , Hutchison Port Holdings Trust is operating in a macro-environment that has been destablized by – competitive advantages are harder to sustain because of technology dispersion, there is backlash against globalization, cloud computing is disrupting traditional business models, banking and financial system is disrupted by Bitcoin and other crypto currencies, talent flight as more people leaving formal jobs, there is increasing trade war between United States & China, wage bills are increasing, increasing government debt because of Covid-19 spendings, geopolitical disruptions, etc

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Introduction to SWOT Analysis of Hutchison Port Holdings Trust

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Hutchison Port Holdings Trust can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Hutchison Port Holdings Trust, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Hutchison Port Holdings Trust 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of Hutchison Port Holdings Trust can be done for the following purposes –
1. Strategic planning of Hutchison Port Holdings Trust
2. Improving business portfolio management of Hutchison Port Holdings Trust
3. Assessing feasibility of the new initiative in Singapore
4. Making a Misc. Transportation sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Hutchison Port Holdings Trust

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Strengths of Hutchison Port Holdings Trust | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Hutchison Port Holdings Trust are -

Successful track record of launching new products

– Hutchison Port Holdings Trust has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Hutchison Port Holdings Trust 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.

Strong track record of project management in the Misc. Transportation industry

– Hutchison Port Holdings Trust is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Diverse revenue streams

– Hutchison Port Holdings Trust is present in almost all the verticals within the Misc. Transportation industry. This has provided Hutchison Port Holdings Trust 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.

Digital Transformation in Misc. Transportation industry

- digital transformation varies from industry to industry. For Hutchison Port Holdings Trust digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Hutchison Port Holdings Trust 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.

Highly skilled collaborators

– Hutchison Port Holdings Trust has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Misc. Transportation industry. Secondly the value chain collaborators of Hutchison Port Holdings Trust have helped the firm to develop new products and bring them quickly to the marketplace.

Effective Research and Development (R&D)

– Hutchison Port Holdings Trust has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Hutchison Port Holdings Trust staying ahead in the Misc. Transportation industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

Superior customer experience

– The customer experience strategy of Hutchison Port Holdings Trust in Misc. Transportation industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Sustainable margins compare to other players in Misc. Transportation industry

– Hutchison Port Holdings Trust has clearly differentiated products in the market place. This has enabled Hutchison Port Holdings Trust to fetch slight price premium compare to the competitors in the Misc. Transportation industry. The sustainable margins have also helped Hutchison Port Holdings Trust to invest into research and development (R&D) and innovation.

Ability to recruit top talent

– Hutchison Port Holdings Trust is one of the leading players in the Misc. Transportation industry in Singapore. It is in a position to attract the best talent available in Singapore. The firm has a robust talent identification program that helps in identifying the brightest.

Analytics focus

– Hutchison Port Holdings Trust 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. Transportation industry. The technology infrastructure of Singapore 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.

High switching costs

– The high switching costs that Hutchison Port Holdings Trust 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.

Training and development

– Hutchison Port Holdings Trust 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.

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Weaknesses of Hutchison Port Holdings Trust | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Hutchison Port Holdings Trust are -

Slow decision making process

– As mentioned earlier in the report, Hutchison Port Holdings Trust has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Misc. Transportation industry over the last five years. Hutchison Port Holdings Trust 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.

Increasing silos among functional specialists

– The organizational structure of Hutchison Port Holdings Trust is dominated by functional specialists. It is not different from other players in the Misc. Transportation industry, but Hutchison Port Holdings Trust needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Hutchison Port Holdings Trust to focus more on services in the Misc. Transportation industry rather than just following the product oriented approach.

High cash cycle compare to competitors

Hutchison Port Holdings Trust has a high cash cycle compare to other players in the Misc. Transportation industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.

Interest costs

– Compare to the competition, Hutchison Port Holdings Trust 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.

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Hutchison Port Holdings Trust is slow explore the new channels of communication. These new channels of communication can help Hutchison Port Holdings Trust to provide better information regarding Misc. Transportation products and services. It can also build an online community to further reach out to potential customers.

Compensation and incentives

– The revenue per employee of Hutchison Port Holdings Trust is just above the Misc. Transportation 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.

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 Hutchison Port Holdings Trust supply chain. Even after few cautionary changes, Hutchison Port Holdings Trust is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Hutchison Port Holdings Trust vulnerable to further global disruptions in South East Asia.

Low market penetration in new markets

– Outside its home market of Singapore, Hutchison Port Holdings Trust needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.

No frontier risks strategy

– From the 10K / annual statement of Hutchison Port Holdings Trust, it seems that company is thinking out the frontier risks that can impact Misc. Transportation 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.

Need for greater diversity

– Hutchison Port Holdings Trust 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.

Ability to respond to the competition

– As the decision making is very deliberative at Hutchison Port Holdings Trust, in the dynamic environment of Misc. Transportation industry it has struggled to respond to the nimble upstart competition. Hutchison Port Holdings Trust has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

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Hutchison Port Holdings Trust Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of Hutchison Port Holdings Trust are -

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 Hutchison Port Holdings Trust 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.

Finding new ways to collaborate

– Covid-19 has not only transformed business models of companies in Misc. Transportation industry, but it has also influenced the consumer preferences. Hutchison Port Holdings Trust can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects Hutchison Port Holdings Trust can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

Lowering marketing communication costs

– 5G expansion will open new opportunities for Hutchison Port Holdings Trust in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Misc. Transportation industry, and it will provide faster access to the consumers.

Building a culture of innovation

– managers at Hutchison Port Holdings Trust 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 Misc. Transportation industry.

Use of Bitcoin and other crypto currencies for transactions in Misc. Transportation industry

– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Hutchison Port Holdings Trust in the Misc. Transportation industry. Now Hutchison Port Holdings Trust can target international markets with far fewer capital restrictions requirements than the existing system.

Loyalty marketing

– Hutchison Port Holdings Trust 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.

Better consumer reach

– The expansion of the 5G network will help Hutchison Port Holdings Trust to increase its market reach. Hutchison Port Holdings Trust 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.

Redefining models of collaboration and team work

– As explained in the weaknesses section, Hutchison Port Holdings Trust is facing challenges because of the dominance of functional experts in the organization. Hutchison Port Holdings Trust can utilize new technology in the field of Misc. Transportation industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.

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. Hutchison Port Holdings Trust can explore opportunities that can attract volunteers and are consistent with its mission and vision.

Manufacturing automation

– Hutchison Port Holdings Trust can use the latest technology developments to improve its manufacturing and designing process in Misc. Transportation 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.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Hutchison Port Holdings Trust 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 Hutchison Port Holdings Trust to hire the very best people irrespective of their geographical location.

Learning at scale

– Online learning technologies has now opened space for Hutchison Port Holdings Trust 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.

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Threats Hutchison Port Holdings Trust External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of Hutchison Port Holdings Trust are -

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. Hutchison Port Holdings Trust 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.

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 Hutchison Port Holdings Trust 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. Transportation industry and other sectors.

Easy access to finance

– Easy access to finance in Misc. Transportation industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Hutchison Port Holdings Trust can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, Hutchison Port Holdings Trust 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. Transportation sector.

Environmental challenges

– Hutchison Port Holdings Trust 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. Hutchison Port Holdings Trust can take advantage of this fund but it will also bring new competitors in the Misc. Transportation industry.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry to Misc. Transportation industry are lowering. It can presents Hutchison Port Holdings Trust with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Misc. Transportation sector.

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 Hutchison Port Holdings Trust in the Misc. Transportation sector and impact the bottomline of the organization.

Technology acceleration in Forth Industrial Revolution

– Hutchison Port Holdings Trust has witnessed rapid integration of technology during Covid-19 in the Misc. Transportation industry. As one of the leading players in the industry, Hutchison Port Holdings Trust needs to keep up with the evolution of technology in the Misc. Transportation 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.

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 Hutchison Port Holdings Trust.

Stagnating economy with rate increase

– Hutchison Port Holdings Trust 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. Transportation industry.

Shortening product life cycle

– it is one of the major threat that Hutchison Port Holdings Trust is facing in Misc. Transportation sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

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 Hutchison Port Holdings Trust business can come under increasing regulations regarding data privacy, data security, etc.

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Weighted SWOT Analysis of Hutchison Port Holdings Trust Template, Example

Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Hutchison Port Holdings Trust 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 Hutchison Port Holdings Trust 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 Hutchison Port Holdings Trust 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 Hutchison Port Holdings Trust 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 Hutchison Port Holdings Trust needs to make to build a sustainable competitive advantage.

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