Dongfang (DFM) SWOT Analysis / TOWS Matrix / MBA Resources
Crops
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Dongfang (Australia)
Based on various researches at Oak Spring University , Dongfang is operating in a macro-environment that has been destablized by – wage bills are increasing, supply chains are disrupted by pandemic , competitive advantages are harder to sustain because of technology dispersion, central banks are concerned over increasing inflation, challanges to central banks by blockchain based private currencies, technology disruption, talent flight as more people leaving formal jobs,
digital marketing is dominated by two big players Facebook and Google, increasing energy prices, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Dongfang can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Dongfang, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Dongfang 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 Dongfang can be done for the following purposes –
1. Strategic planning of Dongfang
2. Improving business portfolio management of Dongfang
3. Assessing feasibility of the new initiative in Australia
4. Making a Crops sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Dongfang
Strengths of Dongfang | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Dongfang are -
Low bargaining power of suppliers
– Suppliers of Dongfang in the Consumer/Non-Cyclical sector have low bargaining power. Dongfang has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Dongfang to manage not only supply disruptions but also source products at highly competitive prices.
Strong track record of project management in the Crops industry
– Dongfang is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Sustainable margins compare to other players in Crops industry
– Dongfang has clearly differentiated products in the market place. This has enabled Dongfang to fetch slight price premium compare to the competitors in the Crops industry. The sustainable margins have also helped Dongfang to invest into research and development (R&D) and innovation.
Training and development
– Dongfang has one of the best training and development program in Consumer/Non-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.
Operational resilience
– The operational resilience strategy of Dongfang comprises – understanding the underlying the factors in the Crops 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.
Digital Transformation in Crops industry
- digital transformation varies from industry to industry. For Dongfang digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Dongfang 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.
Diverse revenue streams
– Dongfang is present in almost all the verticals within the Crops industry. This has provided Dongfang 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.
Highly skilled collaborators
– Dongfang has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Crops industry. Secondly the value chain collaborators of Dongfang have helped the firm to develop new products and bring them quickly to the marketplace.
Effective Research and Development (R&D)
– Dongfang has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Dongfang staying ahead in the Crops industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to recruit top talent
– Dongfang is one of the leading players in the Crops industry in Australia. It is in a position to attract the best talent available in Australia. The firm has a robust talent identification program that helps in identifying the brightest.
Ability to lead change in Crops
– Dongfang is one of the leading players in the Crops industry in Australia. Over the years it has not only transformed the business landscape in the Crops industry in Australia but also across the existing markets. The ability to lead change has enabled Dongfang in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Organizational Resilience of Dongfang
– The covid-19 pandemic has put organizational resilience at the centre of everthing Dongfang does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses of Dongfang | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Dongfang are -
Increasing silos among functional specialists
– The organizational structure of Dongfang is dominated by functional specialists. It is not different from other players in the Crops industry, but Dongfang needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Dongfang to focus more on services in the Crops industry rather than just following the product oriented approach.
Low market penetration in new markets
– Outside its home market of Australia, Dongfang needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High operating costs
– Compare to the competitors, Dongfang has high operating costs in the Crops industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Dongfang lucrative customers.
Workers concerns about automation
– As automation is fast increasing in the Crops industry, Dongfang 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.
Slow decision making process
– As mentioned earlier in the report, Dongfang has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Crops industry over the last five years. Dongfang even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Lack of clear differentiation of Dongfang products
– To increase the profitability and margins on the products, Dongfang needs to provide more differentiated products than what it is currently offering in the marketplace.
Ability to respond to the competition
– As the decision making is very deliberative at Dongfang, in the dynamic environment of Crops industry it has struggled to respond to the nimble upstart competition. Dongfang has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Skills based hiring in Crops industry
– The stress on hiring functional specialists at Dongfang 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.
Products dominated business model
– Even though Dongfang has some of the most successful models in the Crops industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Dongfang should strive to include more intangible value offerings along with its core products and services.
Aligning sales with marketing
– From the outside it seems that Dongfang needs to have more collaboration between its sales team and marketing team. Sales professionals in the Crops industry have deep experience in developing customer relationships. Marketing department at Dongfang can leverage the sales team experience to cultivate customer relationships as Dongfang is planning to shift buying processes online.
Employees’ less understanding of Dongfang strategy
– From the outside it seems that the employees of Dongfang 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.
Dongfang Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Dongfang are -
Buying journey improvements
– Dongfang can improve the customer journey of consumers in the Crops 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.
Creating value in data economy
– The success of analytics program of Dongfang has opened avenues for new revenue streams for the organization in Crops industry. This can help Dongfang to build a more holistic ecosystem for Dongfang products in the Crops industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Better consumer reach
– The expansion of the 5G network will help Dongfang to increase its market reach. Dongfang 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.
Leveraging digital technologies
– Dongfang 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Dongfang in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Crops industry, and it will provide faster access to the consumers.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Dongfang can use these opportunities to build new business models that can help the communities that Dongfang operates in. Secondly it can use opportunities from government spending in Crops sector.
Low interest rates
– Even though inflation is raising its head in most developed economies, Dongfang 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Dongfang is facing challenges because of the dominance of functional experts in the organization. Dongfang can utilize new technology in the field of Crops industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Dongfang can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Developing new processes and practices
– Dongfang can develop new processes and procedures in Crops industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Building a culture of innovation
– managers at Dongfang 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 Crops industry.
Loyalty marketing
– Dongfang 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Dongfang 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 Dongfang 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 Dongfang External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Dongfang are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Dongfang may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Crops sector.
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. Dongfang 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.
Easy access to finance
– Easy access to finance in Crops industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Dongfang can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Dongfang in the Crops sector and impact the bottomline of the organization.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Dongfang in Crops industry. The Crops 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.
Shortening product life cycle
– it is one of the major threat that Dongfang is facing in Crops sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Environmental challenges
– Dongfang 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. Dongfang can take advantage of this fund but it will also bring new competitors in the Crops industry.
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 Dongfang.
Increasing wage structure of Dongfang
– 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 Dongfang.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Dongfang 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 Dongfang prominent markets.
Regulatory challenges
– Dongfang 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 Crops industry regulations.
High dependence on third party suppliers
– Dongfang 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.
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 Dongfang Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Dongfang 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 Dongfang 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 Dongfang 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 Dongfang 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 Dongfang needs to make to build a sustainable competitive advantage.