East Asia Holdings Investment (900110) SWOT Analysis / TOWS Matrix / MBA Resources
Footwear
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for East Asia Holdings Investment (South Korea)
Based on various researches at Oak Spring University , East Asia Holdings Investment is operating in a macro-environment that has been destablized by – increasing government debt because of Covid-19 spendings, increasing inequality as vast percentage of new income is going to the top 1%, banking and financial system is disrupted by Bitcoin and other crypto currencies, talent flight as more people leaving formal jobs, increasing household debt because of falling income levels, customer relationship management is fast transforming because of increasing concerns over data privacy, wage bills are increasing,
technology disruption, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of East Asia Holdings Investment
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that East Asia Holdings Investment can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the East Asia Holdings Investment, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which East Asia Holdings Investment 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 East Asia Holdings Investment can be done for the following purposes –
1. Strategic planning of East Asia Holdings Investment
2. Improving business portfolio management of East Asia Holdings Investment
3. Assessing feasibility of the new initiative in South Korea
4. Making a Footwear sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of East Asia Holdings Investment
Strengths of East Asia Holdings Investment | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of East Asia Holdings Investment are -
Training and development
– East Asia Holdings Investment has one of the best training and development program in Consumer Cyclical 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.
Diverse revenue streams
– East Asia Holdings Investment is present in almost all the verticals within the Footwear industry. This has provided East Asia Holdings Investment 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.
High switching costs
– The high switching costs that East Asia Holdings Investment 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.
Digital Transformation in Footwear industry
- digital transformation varies from industry to industry. For East Asia Holdings Investment digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. East Asia Holdings Investment 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.
Learning organization
- East Asia Holdings Investment 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 East Asia Holdings Investment is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at East Asia Holdings Investment emphasize – knowledge, initiative, and innovation.
Highly skilled collaborators
– East Asia Holdings Investment has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Footwear industry. Secondly the value chain collaborators of East Asia Holdings Investment have helped the firm to develop new products and bring them quickly to the marketplace.
Effective Research and Development (R&D)
– East Asia Holdings Investment has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – East Asia Holdings Investment staying ahead in the Footwear industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Analytics focus
– East Asia Holdings Investment 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 Footwear 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.
Ability to recruit top talent
– East Asia Holdings Investment is one of the leading players in the Footwear 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.
Ability to lead change in Footwear
– East Asia Holdings Investment is one of the leading players in the Footwear industry in South Korea. Over the years it has not only transformed the business landscape in the Footwear industry in South Korea but also across the existing markets. The ability to lead change has enabled East Asia Holdings Investment in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Strong track record of project management in the Footwear industry
– East Asia Holdings Investment is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Low bargaining power of suppliers
– Suppliers of East Asia Holdings Investment in the Consumer Cyclical sector have low bargaining power. East Asia Holdings Investment has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps East Asia Holdings Investment to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses of East Asia Holdings Investment | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of East Asia Holdings Investment are -
Low market penetration in new markets
– Outside its home market of South Korea, East Asia Holdings Investment needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Lack of clear differentiation of East Asia Holdings Investment products
– To increase the profitability and margins on the products, East Asia Holdings Investment needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to strategic competitive environment developments
– As East Asia Holdings Investment is one of the leading players in the Footwear industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Footwear industry in last five years.
High operating costs
– Compare to the competitors, East Asia Holdings Investment has high operating costs in the Footwear industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract East Asia Holdings Investment lucrative customers.
High cash cycle compare to competitors
East Asia Holdings Investment has a high cash cycle compare to other players in the Footwear 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 harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, East Asia Holdings Investment is slow explore the new channels of communication. These new channels of communication can help East Asia Holdings Investment to provide better information regarding Footwear products and services. It can also build an online community to further reach out to potential customers.
Products dominated business model
– Even though East Asia Holdings Investment has some of the most successful models in the Footwear industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. East Asia Holdings Investment should strive to include more intangible value offerings along with its core products and services.
Employees’ less understanding of East Asia Holdings Investment strategy
– From the outside it seems that the employees of East Asia Holdings Investment 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.
Need for greater diversity
– East Asia Holdings Investment 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.
No frontier risks strategy
– From the 10K / annual statement of East Asia Holdings Investment, it seems that company is thinking out the frontier risks that can impact Footwear 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.
Workers concerns about automation
– As automation is fast increasing in the Footwear industry, East Asia Holdings Investment 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.
East Asia Holdings Investment Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of East Asia Holdings Investment are -
Better consumer reach
– The expansion of the 5G network will help East Asia Holdings Investment to increase its market reach. East Asia Holdings Investment 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 Footwear industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for East Asia Holdings Investment in the Footwear industry. Now East Asia Holdings Investment can target international markets with far fewer capital restrictions requirements than the existing system.
Manufacturing automation
– East Asia Holdings Investment can use the latest technology developments to improve its manufacturing and designing process in Footwear 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 East Asia Holdings Investment 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 East Asia Holdings Investment to hire the very best people irrespective of their geographical location.
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. East Asia Holdings Investment 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, East Asia Holdings Investment 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 East Asia Holdings Investment to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects East Asia Holdings Investment can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Low interest rates
– Even though inflation is raising its head in most developed economies, East Asia Holdings Investment 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.
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 East Asia Holdings Investment 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, East Asia Holdings Investment can use these opportunities to build new business models that can help the communities that East Asia Holdings Investment operates in. Secondly it can use opportunities from government spending in Footwear sector.
Creating value in data economy
– The success of analytics program of East Asia Holdings Investment has opened avenues for new revenue streams for the organization in Footwear industry. This can help East Asia Holdings Investment to build a more holistic ecosystem for East Asia Holdings Investment products in the Footwear industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Redefining models of collaboration and team work
– As explained in the weaknesses section, East Asia Holdings Investment is facing challenges because of the dominance of functional experts in the organization. East Asia Holdings Investment can utilize new technology in the field of Footwear industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Loyalty marketing
– East Asia Holdings Investment 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.
Threats East Asia Holdings Investment External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of East Asia Holdings Investment 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. East Asia Holdings Investment 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.
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, East Asia Holdings Investment may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Footwear sector.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Footwear industry are lowering. It can presents East Asia Holdings Investment with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Footwear sector.
Technology acceleration in Forth Industrial Revolution
– East Asia Holdings Investment has witnessed rapid integration of technology during Covid-19 in the Footwear industry. As one of the leading players in the industry, East Asia Holdings Investment needs to keep up with the evolution of technology in the Footwear 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, East Asia Holdings Investment 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 East Asia Holdings Investment prominent markets.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for East Asia Holdings Investment in Footwear industry. The Footwear 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.
Regulatory challenges
– East Asia Holdings Investment 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 Footwear industry regulations.
Easy access to finance
– Easy access to finance in Footwear industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. East Asia Holdings Investment can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Environmental challenges
– East Asia Holdings Investment 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. East Asia Holdings Investment can take advantage of this fund but it will also bring new competitors in the Footwear industry.
High dependence on third party suppliers
– East Asia Holdings Investment 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.
Shortening product life cycle
– it is one of the major threat that East Asia Holdings Investment is facing in Footwear sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing wage structure of East Asia Holdings Investment
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of East Asia Holdings Investment.
Weighted SWOT Analysis of East Asia Holdings Investment Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at East Asia Holdings Investment 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 East Asia Holdings Investment 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 East Asia Holdings Investment 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 East Asia Holdings Investment 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 East Asia Holdings Investment needs to make to build a sustainable competitive advantage.
