Hanwha Q Cells Co (HQCL) SWOT Analysis / TOWS Matrix / MBA Resources
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Hanwha Q Cells Co (United States)
Based on various researches at Oak Spring University , Hanwha Q Cells Co is operating in a macro-environment that has been destablized by – increasing transportation and logistics costs, increasing commodity prices, customer relationship management is fast transforming because of increasing concerns over data privacy, central banks are concerned over increasing inflation, banking and financial system is disrupted by Bitcoin and other crypto currencies, wage bills are increasing, technology disruption,
challanges to central banks by blockchain based private currencies, increasing energy prices, etc
Introduction to SWOT Analysis of Hanwha Q Cells Co
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Hanwha Q Cells Co can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Hanwha Q Cells Co, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Hanwha Q Cells Co 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 Hanwha Q Cells Co can be done for the following purposes –
1. Strategic planning of Hanwha Q Cells Co
2. Improving business portfolio management of Hanwha Q Cells Co
3. Assessing feasibility of the new initiative in United States
4. Making a Semiconductors sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Hanwha Q Cells Co
Strengths of Hanwha Q Cells Co | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Hanwha Q Cells Co are -
Cross disciplinary teams
– Horizontal connected teams at the Hanwha Q Cells Co 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.
Training and development
– Hanwha Q Cells Co 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.
Ability to recruit top talent
– Hanwha Q Cells Co is one of the leading players in the Semiconductors 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.
Sustainable margins compare to other players in Semiconductors industry
– Hanwha Q Cells Co has clearly differentiated products in the market place. This has enabled Hanwha Q Cells Co to fetch slight price premium compare to the competitors in the Semiconductors industry. The sustainable margins have also helped Hanwha Q Cells Co to invest into research and development (R&D) and innovation.
Superior customer experience
– The customer experience strategy of Hanwha Q Cells Co in Semiconductors industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Low bargaining power of suppliers
– Suppliers of Hanwha Q Cells Co in the Technology sector have low bargaining power. Hanwha Q Cells Co has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Hanwha Q Cells Co to manage not only supply disruptions but also source products at highly competitive prices.
High brand equity
– Hanwha Q Cells Co has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Hanwha Q Cells Co to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Digital Transformation in Semiconductors industry
- digital transformation varies from industry to industry. For Hanwha Q Cells Co digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Hanwha Q Cells Co 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.
– The operational resilience strategy of Hanwha Q Cells Co comprises – understanding the underlying the factors in the Semiconductors 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.
– Hanwha Q Cells Co 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 Semiconductors industry. The technology infrastructure of United States 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 Hanwha Q Cells Co 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.
Highly skilled collaborators
– Hanwha Q Cells Co has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Semiconductors industry. Secondly the value chain collaborators of Hanwha Q Cells Co have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses of Hanwha Q Cells Co | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Hanwha Q Cells Co are -
High operating costs
– Compare to the competitors, Hanwha Q Cells Co has high operating costs in the Semiconductors industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Hanwha Q Cells Co lucrative customers.
High dependence on Hanwha Q Cells Co ‘s star products
– The top 2 products and services of Hanwha Q Cells Co still accounts for major business revenue. This dependence on star products in Semiconductors industry has resulted into insufficient focus on developing new products, even though Hanwha Q Cells Co has relatively successful track record of launching new products.
High bargaining power of channel partners in Semiconductors industry
– because of the regulatory requirements in United States, Hanwha Q Cells Co is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the Semiconductors industry.
No frontier risks strategy
– From the 10K / annual statement of Hanwha Q Cells Co, it seems that company is thinking out the frontier risks that can impact Semiconductors 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Hanwha Q Cells Co is slow explore the new channels of communication. These new channels of communication can help Hanwha Q Cells Co to provide better information regarding Semiconductors products and services. It can also build an online community to further reach out to potential customers.
Lack of clear differentiation of Hanwha Q Cells Co products
– To increase the profitability and margins on the products, Hanwha Q Cells Co needs to provide more differentiated products than what it is currently offering in the marketplace.
Products dominated business model
– Even though Hanwha Q Cells Co has some of the most successful models in the Semiconductors industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Hanwha Q Cells Co should strive to include more intangible value offerings along with its core products and services.
Ability to respond to the competition
– As the decision making is very deliberative at Hanwha Q Cells Co, in the dynamic environment of Semiconductors industry it has struggled to respond to the nimble upstart competition. Hanwha Q Cells Co 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 Hanwha Q Cells Co is dominated by functional specialists. It is not different from other players in the Semiconductors industry, but Hanwha Q Cells Co needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Hanwha Q Cells Co to focus more on services in the Semiconductors industry rather than just following the product oriented approach.
Employees’ less understanding of Hanwha Q Cells Co strategy
– From the outside it seems that the employees of Hanwha Q Cells Co 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.
Low market penetration in new markets
– Outside its home market of United States, Hanwha Q Cells Co needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Hanwha Q Cells Co Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Hanwha Q Cells Co are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Hanwha Q Cells Co 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 Hanwha Q Cells Co to hire the very best people irrespective of their geographical location.
Building a culture of innovation
– managers at Hanwha Q Cells Co 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 Semiconductors industry.
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. Hanwha Q Cells Co can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Hanwha Q Cells Co in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Semiconductors industry, and it will provide faster access to the consumers.
– Hanwha Q Cells Co 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Hanwha Q Cells Co can use these opportunities to build new business models that can help the communities that Hanwha Q Cells Co operates in. Secondly it can use opportunities from government spending in Semiconductors sector.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Hanwha Q Cells Co is facing challenges because of the dominance of functional experts in the organization. Hanwha Q Cells Co can utilize new technology in the field of Semiconductors industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Learning at scale
– Online learning technologies has now opened space for Hanwha Q Cells Co 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.
Creating value in data economy
– The success of analytics program of Hanwha Q Cells Co has opened avenues for new revenue streams for the organization in Semiconductors industry. This can help Hanwha Q Cells Co to build a more holistic ecosystem for Hanwha Q Cells Co products in the Semiconductors industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Semiconductors industry, but it has also influenced the consumer preferences. Hanwha Q Cells Co can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Leveraging digital technologies
– Hanwha Q Cells Co 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.
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 Hanwha Q Cells Co 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Hanwha Q Cells Co 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 Hanwha Q Cells Co to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Threats Hanwha Q Cells Co External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Hanwha Q Cells Co are -
– Hanwha Q Cells Co 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 Semiconductors industry regulations.
– Hanwha Q Cells Co 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. Hanwha Q Cells Co can take advantage of this fund but it will also bring new competitors in the Semiconductors industry.
Technology acceleration in Forth Industrial Revolution
– Hanwha Q Cells Co has witnessed rapid integration of technology during Covid-19 in the Semiconductors industry. As one of the leading players in the industry, Hanwha Q Cells Co needs to keep up with the evolution of technology in the Semiconductors 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 wage structure of Hanwha Q Cells Co
– 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 Hanwha Q Cells Co.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Semiconductors industry are lowering. It can presents Hanwha Q Cells Co with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Semiconductors sector.
– 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 Semiconductors industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Hanwha Q Cells Co can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
High dependence on third party suppliers
– Hanwha Q Cells Co 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.
– 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 Hanwha Q Cells Co in the Semiconductors sector and impact the bottomline of the organization.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Hanwha Q Cells Co 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.
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 Hanwha Q Cells Co business can come under increasing regulations regarding data privacy, data security, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Hanwha Q Cells Co may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Semiconductors sector.
Consumer confidence and its impact on Hanwha Q Cells Co 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 Semiconductors industry and other sectors.
Weighted SWOT Analysis of Hanwha Q Cells Co Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Hanwha Q Cells Co 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 Hanwha Q Cells Co 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 Hanwha Q Cells Co 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 Hanwha Q Cells Co 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 Hanwha Q Cells Co needs to make to build a sustainable competitive advantage.