SWOT Analysis / TOWS Matrix for Jaeyoung Solutec (South Korea)
Based on various researches at Oak Spring University , Jaeyoung Solutec is operating in a macro-environment that has been destablized by – digital marketing is dominated by two big players Facebook and Google, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing energy prices, increasing inequality as vast percentage of new income is going to the top 1%, increasing commodity prices, increasing household debt because of falling income levels, geopolitical disruptions,
there is increasing trade war between United States & China, competitive advantages are harder to sustain because of technology dispersion, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Jaeyoung Solutec can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Jaeyoung Solutec, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Jaeyoung Solutec 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 Jaeyoung Solutec can be done for the following purposes –
1. Strategic planning of Jaeyoung Solutec
2. Improving business portfolio management of Jaeyoung Solutec
3. Assessing feasibility of the new initiative in South Korea
4. Making a Scientific & Technical Instr. sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Jaeyoung Solutec
Strengths of Jaeyoung Solutec | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Jaeyoung Solutec are -
Ability to lead change in Scientific & Technical Instr.
– Jaeyoung Solutec is one of the leading players in the Scientific & Technical Instr. industry in South Korea. Over the years it has not only transformed the business landscape in the Scientific & Technical Instr. industry in South Korea but also across the existing markets. The ability to lead change has enabled Jaeyoung Solutec in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High switching costs
– The high switching costs that Jaeyoung Solutec 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.
Low bargaining power of suppliers
– Suppliers of Jaeyoung Solutec in the Technology sector have low bargaining power. Jaeyoung Solutec has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Jaeyoung Solutec to manage not only supply disruptions but also source products at highly competitive prices.
Training and development
– Jaeyoung Solutec has one of the best training and development program in Technology 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
– Jaeyoung Solutec is one of the most innovative firm in Scientific & Technical Instr. sector.
High brand equity
– Jaeyoung Solutec has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Jaeyoung Solutec to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Organizational Resilience of Jaeyoung Solutec
– The covid-19 pandemic has put organizational resilience at the centre of everthing Jaeyoung Solutec does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Effective Research and Development (R&D)
– Jaeyoung Solutec has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Jaeyoung Solutec staying ahead in the Scientific & Technical Instr. industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Diverse revenue streams
– Jaeyoung Solutec is present in almost all the verticals within the Scientific & Technical Instr. industry. This has provided Jaeyoung Solutec 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.
Successful track record of launching new products
– Jaeyoung Solutec has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Jaeyoung Solutec 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.
Learning organization
- Jaeyoung Solutec 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 Jaeyoung Solutec is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Jaeyoung Solutec emphasize – knowledge, initiative, and innovation.
Highly skilled collaborators
– Jaeyoung Solutec has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Scientific & Technical Instr. industry. Secondly the value chain collaborators of Jaeyoung Solutec have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses of Jaeyoung Solutec | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Jaeyoung Solutec are -
Employees’ less understanding of Jaeyoung Solutec strategy
– From the outside it seems that the employees of Jaeyoung Solutec 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.
Ability to respond to the competition
– As the decision making is very deliberative at Jaeyoung Solutec, in the dynamic environment of Scientific & Technical Instr. industry it has struggled to respond to the nimble upstart competition. Jaeyoung Solutec has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High cash cycle compare to competitors
Jaeyoung Solutec has a high cash cycle compare to other players in the Scientific & Technical Instr. industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
High operating costs
– Compare to the competitors, Jaeyoung Solutec has high operating costs in the Scientific & Technical Instr. industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Jaeyoung Solutec lucrative customers.
Low market penetration in new markets
– Outside its home market of South Korea, Jaeyoung Solutec needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High dependence on Jaeyoung Solutec ‘s star products
– The top 2 products and services of Jaeyoung Solutec still accounts for major business revenue. This dependence on star products in Scientific & Technical Instr. industry has resulted into insufficient focus on developing new products, even though Jaeyoung Solutec has relatively successful track record of launching new products.
Skills based hiring in Scientific & Technical Instr. industry
– The stress on hiring functional specialists at Jaeyoung Solutec 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, Jaeyoung Solutec 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 Scientific & Technical Instr. industry using digital technology.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Jaeyoung Solutec is slow explore the new channels of communication. These new channels of communication can help Jaeyoung Solutec to provide better information regarding Scientific & Technical Instr. products and services. It can also build an online community to further reach out to potential customers.
Interest costs
– Compare to the competition, Jaeyoung Solutec 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.
Lack of clear differentiation of Jaeyoung Solutec products
– To increase the profitability and margins on the products, Jaeyoung Solutec needs to provide more differentiated products than what it is currently offering in the marketplace.
Jaeyoung Solutec Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Jaeyoung Solutec are -
Building a culture of innovation
– managers at Jaeyoung Solutec 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 Scientific & Technical Instr. industry.
Better consumer reach
– The expansion of the 5G network will help Jaeyoung Solutec to increase its market reach. Jaeyoung Solutec 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.
Creating value in data economy
– The success of analytics program of Jaeyoung Solutec has opened avenues for new revenue streams for the organization in Scientific & Technical Instr. industry. This can help Jaeyoung Solutec to build a more holistic ecosystem for Jaeyoung Solutec products in the Scientific & Technical Instr. 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 Jaeyoung Solutec can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Using analytics as competitive advantage
– Jaeyoung Solutec has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Scientific & Technical Instr. sector. This continuous investment in analytics has enabled Jaeyoung Solutec to build a competitive advantage using analytics. The analytics driven competitive advantage can help Jaeyoung Solutec to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Scientific & Technical Instr. industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Jaeyoung Solutec 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. Jaeyoung Solutec 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Jaeyoung Solutec 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Jaeyoung Solutec is facing challenges because of the dominance of functional experts in the organization. Jaeyoung Solutec can utilize new technology in the field of Scientific & Technical Instr. industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, 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 Jaeyoung Solutec 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.
Use of Bitcoin and other crypto currencies for transactions in Scientific & Technical Instr. industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Jaeyoung Solutec in the Scientific & Technical Instr. industry. Now Jaeyoung Solutec can target international markets with far fewer capital restrictions requirements than the existing system.
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. Jaeyoung Solutec can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Jaeyoung Solutec 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 Jaeyoung Solutec to hire the very best people irrespective of their geographical location.
Buying journey improvements
– Jaeyoung Solutec can improve the customer journey of consumers in the Scientific & Technical Instr. 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.
Threats Jaeyoung Solutec External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Jaeyoung Solutec are -
Environmental challenges
– Jaeyoung Solutec 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. Jaeyoung Solutec can take advantage of this fund but it will also bring new competitors in the Scientific & Technical Instr. industry.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Easy access to finance
– Easy access to finance in Scientific & Technical Instr. industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Jaeyoung Solutec can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Jaeyoung Solutec needs to understand the core reasons impacting the Scientific & Technical Instr. industry. This will help it in building a better workplace.
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 Jaeyoung Solutec business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Jaeyoung Solutec 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 Scientific & Technical Instr. industry.
Shortening product life cycle
– it is one of the major threat that Jaeyoung Solutec is facing in Scientific & Technical Instr. sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Scientific & Technical Instr. industry are lowering. It can presents Jaeyoung Solutec with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Scientific & Technical Instr. sector.
Regulatory challenges
– Jaeyoung Solutec 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 Scientific & Technical Instr. industry regulations.
Consumer confidence and its impact on Jaeyoung Solutec 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 Scientific & Technical Instr. industry and other sectors.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Jaeyoung Solutec may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Scientific & Technical Instr. sector.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Jaeyoung Solutec in Scientific & Technical Instr. industry. The Scientific & Technical Instr. 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.
High dependence on third party suppliers
– Jaeyoung Solutec 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.
Weighted SWOT Analysis of Jaeyoung Solutec Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Jaeyoung Solutec 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 Jaeyoung Solutec 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 Jaeyoung Solutec 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 Jaeyoung Solutec 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 Jaeyoung Solutec needs to make to build a sustainable competitive advantage.