Puxin (NEW) SWOT Analysis / TOWS Matrix / MBA Resources
Schools
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Puxin (United States)
Based on various researches at Oak Spring University , Puxin is operating in a macro-environment that has been destablized by – technology disruption, increasing government debt because of Covid-19 spendings, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing commodity prices, increasing household debt because of falling income levels, talent flight as more people leaving formal jobs, competitive advantages are harder to sustain because of technology dispersion,
digital marketing is dominated by two big players Facebook and Google, central banks are concerned over increasing inflation, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Puxin can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Puxin, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Puxin 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 Puxin can be done for the following purposes –
1. Strategic planning of Puxin
2. Improving business portfolio management of Puxin
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 Puxin
Strengths of Puxin | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Puxin are -
Low bargaining power of suppliers
– Suppliers of Puxin in the Services sector have low bargaining power. Puxin has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Puxin to manage not only supply disruptions but also source products at highly competitive prices.
Ability to recruit top talent
– Puxin 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.
High switching costs
– The high switching costs that Puxin 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 Puxin 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.
Strong track record of project management in the Schools industry
– Puxin is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Diverse revenue streams
– Puxin is present in almost all the verticals within the Schools industry. This has provided Puxin 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.
Effective Research and Development (R&D)
– Puxin has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Puxin 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.
Learning organization
- Puxin 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 Puxin is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Puxin emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– Puxin is one of the most innovative firm in Schools sector.
Organizational Resilience of Puxin
– The covid-19 pandemic has put organizational resilience at the centre of everthing Puxin does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High brand equity
– Puxin has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Puxin to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Highly skilled collaborators
– Puxin 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 Puxin have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses of Puxin | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Puxin are -
High dependence on Puxin ‘s star products
– The top 2 products and services of Puxin 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 Puxin has relatively successful track record of launching new products.
Compensation and incentives
– The revenue per employee of Puxin 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.
Employees’ less understanding of Puxin strategy
– From the outside it seems that the employees of Puxin don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Ability to respond to the competition
– As the decision making is very deliberative at Puxin, in the dynamic environment of Schools industry it has struggled to respond to the nimble upstart competition. Puxin 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 Puxin is dominated by functional specialists. It is not different from other players in the Schools industry, but Puxin needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Puxin to focus more on services in the Schools industry rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As Puxin 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.
Aligning sales with marketing
– From the outside it seems that Puxin 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 Puxin can leverage the sales team experience to cultivate customer relationships as Puxin is planning to shift buying processes online.
Products dominated business model
– Even though Puxin has some of the most successful models in the Schools industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Puxin should strive to include more intangible value offerings along with its core products and services.
Capital Spending Reduction
– Even during the low interest decade, Puxin has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the Schools industry using digital technology.
Workers concerns about automation
– As automation is fast increasing in the Schools industry, Puxin 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.
Skills based hiring in Schools industry
– The stress on hiring functional specialists at Puxin 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.
Puxin Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Puxin are -
Low interest rates
– Even though inflation is raising its head in most developed economies, Puxin 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.
Use of Bitcoin and other crypto currencies for transactions in Schools industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Puxin in the Schools industry. Now Puxin can target international markets with far fewer capital restrictions requirements than the existing system.
Better consumer reach
– The expansion of the 5G network will help Puxin to increase its market reach. Puxin 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.
Buying journey improvements
– Puxin can improve the customer journey of consumers in the Schools industry by using analytics and artificial intelligence. It can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Loyalty marketing
– Puxin 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.
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. Puxin 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. Puxin 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Puxin is facing challenges because of the dominance of functional experts in the organization. Puxin 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Puxin in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Schools industry, and it will provide faster access to the consumers.
Leveraging digital technologies
– Puxin 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.
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. Puxin can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Puxin 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 Puxin to hire the very best people irrespective of their geographical location.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Puxin can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Puxin 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.
Threats Puxin External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Puxin are -
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 Puxin in the Schools sector and impact the bottomline of the organization.
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. Puxin can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Shortening product life cycle
– it is one of the major threat that Puxin is facing in Schools sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Puxin needs to understand the core reasons impacting the Schools industry. This will help it in building a better workplace.
Increasing wage structure of Puxin
– 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 Puxin.
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.
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 Puxin business can come under increasing regulations regarding data privacy, data security, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Schools industry are lowering. It can presents Puxin with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Schools sector.
Environmental challenges
– Puxin 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. Puxin can take advantage of this fund but it will also bring new competitors in the Schools industry.
Stagnating economy with rate increase
– Puxin 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 Schools industry.
High dependence on third party suppliers
– Puxin 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.
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 Puxin.
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.
Weighted SWOT Analysis of Puxin Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Puxin 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 Puxin 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 Puxin 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 Puxin 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 Puxin needs to make to build a sustainable competitive advantage.