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New Oriental Education&Tech (EDU) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for New Oriental Education&Tech (United States)


Based on various researches at Oak Spring University , New Oriental Education&Tech is operating in a macro-environment that has been destablized by – increasing household debt because of falling income levels, there is backlash against globalization, challanges to central banks by blockchain based private currencies, central banks are concerned over increasing inflation, increasing transportation and logistics costs, talent flight as more people leaving formal jobs, wage bills are increasing, supply chains are disrupted by pandemic , competitive advantages are harder to sustain because of technology dispersion, etc



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Introduction to SWOT Analysis of New Oriental Education&Tech


SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that New Oriental Education&Tech can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the New Oriental Education&Tech, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which New Oriental Education&Tech 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 New Oriental Education&Tech can be done for the following purposes –
1. Strategic planning of New Oriental Education&Tech
2. Improving business portfolio management of New Oriental Education&Tech
3. Assessing feasibility of the new initiative in United States
4. Making a Schools sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of New Oriental Education&Tech




Strengths of New Oriental Education&Tech | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of New Oriental Education&Tech are -

Operational resilience

– The operational resilience strategy of New Oriental Education&Tech comprises – understanding the underlying the factors in the Schools industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.

High brand equity

– New Oriental Education&Tech has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled New Oriental Education&Tech to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Organizational Resilience of New Oriental Education&Tech

– The covid-19 pandemic has put organizational resilience at the centre of everthing New Oriental Education&Tech does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.

Digital Transformation in Schools industry

- digital transformation varies from industry to industry. For New Oriental Education&Tech digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. New Oriental Education&Tech 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 lead change in Schools

– New Oriental Education&Tech is one of the leading players in the Schools industry in United States. Over the years it has not only transformed the business landscape in the Schools industry in United States but also across the existing markets. The ability to lead change has enabled New Oriental Education&Tech in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

Ability to recruit top talent

– New Oriental Education&Tech is one of the leading players in the Schools industry in United States. It is in a position to attract the best talent available in United States. The firm has a robust talent identification program that helps in identifying the brightest.

Learning organization

- New Oriental Education&Tech 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 New Oriental Education&Tech is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at New Oriental Education&Tech emphasize – knowledge, initiative, and innovation.

Effective Research and Development (R&D)

– New Oriental Education&Tech has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – New Oriental Education&Tech staying ahead in the Schools industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

Innovation driven organization

– New Oriental Education&Tech is one of the most innovative firm in Schools sector.

Highly skilled collaborators

– New Oriental Education&Tech has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Schools industry. Secondly the value chain collaborators of New Oriental Education&Tech have helped the firm to develop new products and bring them quickly to the marketplace.

Successful track record of launching new products

– New Oriental Education&Tech has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. New Oriental Education&Tech 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.

Superior customer experience

– The customer experience strategy of New Oriental Education&Tech in Schools industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.






Weaknesses of New Oriental Education&Tech | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of New Oriental Education&Tech are -

Ability to respond to the competition

– As the decision making is very deliberative at New Oriental Education&Tech, in the dynamic environment of Schools industry it has struggled to respond to the nimble upstart competition. New Oriental Education&Tech has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, New Oriental Education&Tech is slow explore the new channels of communication. These new channels of communication can help New Oriental Education&Tech to provide better information regarding Schools products and services. It can also build an online community to further reach out to potential customers.

Need for greater diversity

– New Oriental Education&Tech 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.

High dependence on New Oriental Education&Tech ‘s star products

– The top 2 products and services of New Oriental Education&Tech still accounts for major business revenue. This dependence on star products in Schools industry has resulted into insufficient focus on developing new products, even though New Oriental Education&Tech has relatively successful track record of launching new products.

Low market penetration in new markets

– Outside its home market of United States, New Oriental Education&Tech needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.

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 New Oriental Education&Tech supply chain. Even after few cautionary changes, New Oriental Education&Tech is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left New Oriental Education&Tech vulnerable to further global disruptions in South East Asia.

Lack of clear differentiation of New Oriental Education&Tech products

– To increase the profitability and margins on the products, New Oriental Education&Tech needs to provide more differentiated products than what it is currently offering in the marketplace.

Aligning sales with marketing

– From the outside it seems that New Oriental Education&Tech needs to have more collaboration between its sales team and marketing team. Sales professionals in the Schools industry have deep experience in developing customer relationships. Marketing department at New Oriental Education&Tech can leverage the sales team experience to cultivate customer relationships as New Oriental Education&Tech is planning to shift buying processes online.

Compensation and incentives

– The revenue per employee of New Oriental Education&Tech is just above the Schools 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.

Skills based hiring in Schools industry

– The stress on hiring functional specialists at New Oriental Education&Tech 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.

Slow to strategic competitive environment developments

– As New Oriental Education&Tech is one of the leading players in the Schools industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Schools industry in last five years.




New Oriental Education&Tech Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis


The opportunities of New Oriental Education&Tech are -

Building a culture of innovation

– managers at New Oriental Education&Tech 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 Schools industry.

Redefining models of collaboration and team work

– As explained in the weaknesses section, New Oriental Education&Tech is facing challenges because of the dominance of functional experts in the organization. New Oriental Education&Tech can utilize new technology in the field of Schools industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for New Oriental Education&Tech 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 New Oriental Education&Tech to hire the very best people irrespective of their geographical location.

Better consumer reach

– The expansion of the 5G network will help New Oriental Education&Tech to increase its market reach. New Oriental Education&Tech 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.

Loyalty marketing

– New Oriental Education&Tech 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.

Leveraging digital technologies

– New Oriental Education&Tech 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.

Changes in consumer behavior post Covid-19

– consumer behavior has changed in the Schools industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. New Oriental Education&Tech 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. New Oriental Education&Tech 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, New Oriental Education&Tech 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.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, New Oriental Education&Tech can use these opportunities to build new business models that can help the communities that New Oriental Education&Tech operates in. Secondly it can use opportunities from government spending in Schools sector.

Reforming the budgeting process

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

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, New Oriental Education&Tech 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 New Oriental Education&Tech to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

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. New Oriental Education&Tech can explore opportunities that can attract volunteers and are consistent with its mission and vision.

Learning at scale

– Online learning technologies has now opened space for New Oriental Education&Tech 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.




Threats New Oriental Education&Tech External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis


The threats of New Oriental Education&Tech are -

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, New Oriental Education&Tech may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Schools sector.

Environmental challenges

– New Oriental Education&Tech 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. New Oriental Education&Tech can take advantage of this fund but it will also bring new competitors in the Schools industry.

Shortening product life cycle

– it is one of the major threat that New Oriental Education&Tech is facing in Schools sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, New Oriental Education&Tech 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 New Oriental Education&Tech prominent markets.

Regulatory challenges

– New Oriental Education&Tech 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 Schools industry regulations.

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 New Oriental Education&Tech.

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. New Oriental Education&Tech 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.

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. New Oriental Education&Tech needs to understand the core reasons impacting the Schools industry. This will help it in building a better workplace.

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.

Increasing wage structure of New Oriental Education&Tech

– 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 New Oriental Education&Tech.

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 New Oriental Education&Tech in the Schools sector and impact the bottomline of the organization.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry to Schools industry are lowering. It can presents New Oriental Education&Tech with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Schools sector.

Easy access to finance

– Easy access to finance in Schools industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. New Oriental Education&Tech can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.




Weighted SWOT Analysis of New Oriental Education&Tech Template, Example


Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at New Oriental Education&Tech 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 New Oriental Education&Tech 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 New Oriental Education&Tech 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 New Oriental Education&Tech 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 New Oriental Education&Tech needs to make to build a sustainable competitive advantage.



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