Yeong Hwa Meta (12280) SWOT Analysis / TOWS Matrix / MBA Resources
Auto & Truck Parts
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Yeong Hwa Meta (South Korea)
Based on various researches at Oak Spring University , Yeong Hwa Meta is operating in a macro-environment that has been destablized by – wage bills are increasing, there is backlash against globalization, there is increasing trade war between United States & China, cloud computing is disrupting traditional business models, competitive advantages are harder to sustain because of technology dispersion, increasing transportation and logistics costs, increasing inequality as vast percentage of new income is going to the top 1%,
customer relationship management is fast transforming because of increasing concerns over data privacy, increasing energy prices, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Yeong Hwa Meta can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Yeong Hwa Meta, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Yeong Hwa Meta 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 Yeong Hwa Meta can be done for the following purposes –
1. Strategic planning of Yeong Hwa Meta
2. Improving business portfolio management of Yeong Hwa Meta
3. Assessing feasibility of the new initiative in South Korea
4. Making a Auto & Truck Parts sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Yeong Hwa Meta
Strengths of Yeong Hwa Meta | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Yeong Hwa Meta are -
Effective Research and Development (R&D)
– Yeong Hwa Meta has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Yeong Hwa Meta staying ahead in the Auto & Truck Parts 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 Yeong Hwa Meta in Auto & Truck Parts industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Yeong Hwa Meta has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Auto & Truck Parts industry. Secondly the value chain collaborators of Yeong Hwa Meta have helped the firm to develop new products and bring them quickly to the marketplace.
Digital Transformation in Auto & Truck Parts industry
- digital transformation varies from industry to industry. For Yeong Hwa Meta digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Yeong Hwa Meta 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.
Ability to recruit top talent
– Yeong Hwa Meta is one of the leading players in the Auto & Truck Parts industry in South Korea. It is in a position to attract the best talent available in South Korea. The firm has a robust talent identification program that helps in identifying the brightest.
High brand equity
– Yeong Hwa Meta has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Yeong Hwa Meta to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of Yeong Hwa Meta in the Consumer Cyclical sector have low bargaining power. Yeong Hwa Meta has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Yeong Hwa Meta to manage not only supply disruptions but also source products at highly competitive prices.
Strong track record of project management in the Auto & Truck Parts industry
– Yeong Hwa Meta is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Analytics focus
– Yeong Hwa Meta 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 Auto & Truck Parts industry. The technology infrastructure of South Korea 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 Yeong Hwa Meta 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.
Cross disciplinary teams
– Horizontal connected teams at the Yeong Hwa Meta 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.
Innovation driven organization
– Yeong Hwa Meta is one of the most innovative firm in Auto & Truck Parts sector.
Weaknesses of Yeong Hwa Meta | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Yeong Hwa Meta are -
Employees’ less understanding of Yeong Hwa Meta strategy
– From the outside it seems that the employees of Yeong Hwa Meta 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.
Aligning sales with marketing
– From the outside it seems that Yeong Hwa Meta needs to have more collaboration between its sales team and marketing team. Sales professionals in the Auto & Truck Parts industry have deep experience in developing customer relationships. Marketing department at Yeong Hwa Meta can leverage the sales team experience to cultivate customer relationships as Yeong Hwa Meta is planning to shift buying processes online.
Workers concerns about automation
– As automation is fast increasing in the Auto & Truck Parts industry, Yeong Hwa Meta 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 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 Yeong Hwa Meta supply chain. Even after few cautionary changes, Yeong Hwa Meta is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Yeong Hwa Meta vulnerable to further global disruptions in South East Asia.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Yeong Hwa Meta is slow explore the new channels of communication. These new channels of communication can help Yeong Hwa Meta to provide better information regarding Auto & Truck Parts products and services. It can also build an online community to further reach out to potential customers.
Need for greater diversity
– Yeong Hwa Meta 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 Yeong Hwa Meta, in the dynamic environment of Auto & Truck Parts industry it has struggled to respond to the nimble upstart competition. Yeong Hwa Meta has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Increasing silos among functional specialists
– The organizational structure of Yeong Hwa Meta is dominated by functional specialists. It is not different from other players in the Auto & Truck Parts industry, but Yeong Hwa Meta needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Yeong Hwa Meta to focus more on services in the Auto & Truck Parts industry rather than just following the product oriented approach.
No frontier risks strategy
– From the 10K / annual statement of Yeong Hwa Meta, it seems that company is thinking out the frontier risks that can impact Auto & Truck Parts 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.
High cash cycle compare to competitors
Yeong Hwa Meta has a high cash cycle compare to other players in the Auto & Truck Parts industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Slow to strategic competitive environment developments
– As Yeong Hwa Meta is one of the leading players in the Auto & Truck Parts industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Auto & Truck Parts industry in last five years.
Yeong Hwa Meta Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Yeong Hwa Meta are -
Use of Bitcoin and other crypto currencies for transactions in Auto & Truck Parts industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Yeong Hwa Meta in the Auto & Truck Parts industry. Now Yeong Hwa Meta can target international markets with far fewer capital restrictions requirements than the existing system.
Building a culture of innovation
– managers at Yeong Hwa Meta 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 Auto & Truck Parts industry.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Auto & Truck Parts industry, but it has also influenced the consumer preferences. Yeong Hwa Meta can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Loyalty marketing
– Yeong Hwa Meta 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.
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. Yeong Hwa Meta can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Yeong Hwa Meta 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 Yeong Hwa Meta to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Yeong Hwa Meta 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 Yeong Hwa Meta to hire the very best people irrespective of their geographical location.
Leveraging digital technologies
– Yeong Hwa Meta 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.
Manufacturing automation
– Yeong Hwa Meta can use the latest technology developments to improve its manufacturing and designing process in Auto & Truck Parts 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Yeong Hwa Meta can use these opportunities to build new business models that can help the communities that Yeong Hwa Meta operates in. Secondly it can use opportunities from government spending in Auto & Truck Parts sector.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Yeong Hwa Meta in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Auto & Truck Parts industry, and it will provide faster access to the consumers.
Using analytics as competitive advantage
– Yeong Hwa Meta has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Auto & Truck Parts sector. This continuous investment in analytics has enabled Yeong Hwa Meta to build a competitive advantage using analytics. The analytics driven competitive advantage can help Yeong Hwa Meta to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Creating value in data economy
– The success of analytics program of Yeong Hwa Meta has opened avenues for new revenue streams for the organization in Auto & Truck Parts industry. This can help Yeong Hwa Meta to build a more holistic ecosystem for Yeong Hwa Meta products in the Auto & Truck Parts industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Threats Yeong Hwa Meta External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Yeong Hwa Meta are -
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. Yeong Hwa Meta needs to understand the core reasons impacting the Auto & Truck Parts industry. This will help it in building a better workplace.
High dependence on third party suppliers
– Yeong Hwa Meta 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.
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.
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 Yeong Hwa Meta in the Auto & Truck Parts sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– Yeong Hwa Meta has witnessed rapid integration of technology during Covid-19 in the Auto & Truck Parts industry. As one of the leading players in the industry, Yeong Hwa Meta needs to keep up with the evolution of technology in the Auto & Truck Parts 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 Yeong Hwa Meta.
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 Yeong Hwa Meta business can come under increasing regulations regarding data privacy, data security, etc.
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. Yeong Hwa Meta 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
– Yeong Hwa Meta 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 Auto & Truck Parts industry.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Yeong Hwa Meta in Auto & Truck Parts industry. The Auto & Truck Parts 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.
Consumer confidence and its impact on Yeong Hwa Meta 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 Auto & Truck Parts industry and other sectors.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Yeong Hwa Meta may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Auto & Truck Parts sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Yeong Hwa Meta 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 Yeong Hwa Meta prominent markets.
Weighted SWOT Analysis of Yeong Hwa Meta Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Yeong Hwa Meta 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 Yeong Hwa Meta 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 Yeong Hwa Meta 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 Yeong Hwa Meta 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 Yeong Hwa Meta needs to make to build a sustainable competitive advantage.