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 – talent flight as more people leaving formal jobs, central banks are concerned over increasing inflation, increasing commodity prices, there is increasing trade war between United States & China, increasing energy prices, geopolitical disruptions, wage bills are increasing, increasing transportation and logistics costs, increasing government debt because of Covid-19 spendings, 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 -

Learning organization

- Hutchison Port Holdings Trust 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 Hutchison Port Holdings Trust is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Hutchison Port Holdings Trust emphasize – knowledge, initiative, and innovation.

Ability to lead change in Misc. Transportation

– Hutchison Port Holdings Trust is one of the leading players in the Misc. Transportation industry in Singapore. Over the years it has not only transformed the business landscape in the Misc. Transportation industry in Singapore but also across the existing markets. The ability to lead change has enabled Hutchison Port Holdings Trust in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

Organizational Resilience of Hutchison Port Holdings Trust

– The covid-19 pandemic has put organizational resilience at the centre of everthing Hutchison Port Holdings Trust does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.

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.

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.

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.

Cross disciplinary teams

– Horizontal connected teams at the Hutchison Port Holdings Trust are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.

Low bargaining power of suppliers

– Suppliers of Hutchison Port Holdings Trust in the Transportation sector have low bargaining power. Hutchison Port Holdings Trust has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Hutchison Port Holdings Trust to manage not only supply disruptions but also source products at highly competitive prices.

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.

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.

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.

High brand equity

– Hutchison Port Holdings Trust has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Hutchison Port Holdings Trust to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

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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 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.

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.

Workers concerns about automation

– As automation is fast increasing in the Misc. Transportation industry, Hutchison Port Holdings Trust 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.

High dependence on Hutchison Port Holdings Trust ‘s star products

– The top 2 products and services of Hutchison Port Holdings Trust still accounts for major business revenue. This dependence on star products in Misc. Transportation industry has resulted into insufficient focus on developing new products, even though Hutchison Port Holdings Trust has relatively successful track record of launching new products.

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.

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 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.

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.

Employees’ less understanding of Hutchison Port Holdings Trust strategy

– From the outside it seems that the employees of Hutchison Port Holdings Trust 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 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.

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.

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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 -

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.

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.

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.

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.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Hutchison Port Holdings Trust can use these opportunities to build new business models that can help the communities that Hutchison Port Holdings Trust operates in. Secondly it can use opportunities from government spending in Misc. Transportation sector.

Creating value in data economy

– The success of analytics program of Hutchison Port Holdings Trust has opened avenues for new revenue streams for the organization in Misc. Transportation industry. This can help Hutchison Port Holdings Trust to build a more holistic ecosystem for Hutchison Port Holdings Trust products in the Misc. Transportation industry by providing – data insight services, data privacy related products, data based consulting services, etc.

Leveraging digital technologies

– Hutchison Port Holdings Trust 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.

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.

Buying journey improvements

– Hutchison Port Holdings Trust can improve the customer journey of consumers in the Misc. Transportation 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.

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.

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.

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.

Low interest rates

– Even though inflation is raising its head in most developed economies, Hutchison Port Holdings Trust 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.

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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 -

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.

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.

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.

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.

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.

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.

High dependence on third party suppliers

– Hutchison Port Holdings Trust 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.

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.

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. Hutchison Port Holdings Trust needs to understand the core reasons impacting the Misc. Transportation industry. This will help it in building a better workplace.

Regulatory challenges

– Hutchison Port Holdings Trust 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. Transportation 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.

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.

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.

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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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