SWOT Analysis / TOWS Matrix for Hebei Yangyuan ZhiHui (China)
Based on various researches at Oak Spring University , Hebei Yangyuan ZhiHui is operating in a macro-environment that has been destablized by – cloud computing is disrupting traditional business models, increasing household debt because of falling income levels, increasing government debt because of Covid-19 spendings, talent flight as more people leaving formal jobs, customer relationship management is fast transforming because of increasing concerns over data privacy, central banks are concerned over increasing inflation, there is increasing trade war between United States & China,
there is backlash against globalization, banking and financial system is disrupted by Bitcoin and other crypto currencies, etc
Introduction to SWOT Analysis of Hebei Yangyuan ZhiHui
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Hebei Yangyuan ZhiHui can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Hebei Yangyuan ZhiHui, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Hebei Yangyuan ZhiHui 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 Hebei Yangyuan ZhiHui can be done for the following purposes –
1. Strategic planning of Hebei Yangyuan ZhiHui
2. Improving business portfolio management of Hebei Yangyuan ZhiHui
3. Assessing feasibility of the new initiative in China
4. Making a Beverages (Nonalcoholic) sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Hebei Yangyuan ZhiHui
Strengths of Hebei Yangyuan ZhiHui | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Hebei Yangyuan ZhiHui are -
Ability to recruit top talent
– Hebei Yangyuan ZhiHui is one of the leading players in the Beverages (Nonalcoholic) industry in China. It is in a position to attract the best talent available in China. The firm has a robust talent identification program that helps in identifying the brightest.
Successful track record of launching new products
– Hebei Yangyuan ZhiHui has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Hebei Yangyuan ZhiHui 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 Hebei Yangyuan ZhiHui in Beverages (Nonalcoholic) industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Diverse revenue streams
– Hebei Yangyuan ZhiHui is present in almost all the verticals within the Beverages (Nonalcoholic) industry. This has provided Hebei Yangyuan ZhiHui 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 Hebei Yangyuan ZhiHui 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.
Operational resilience
– The operational resilience strategy of Hebei Yangyuan ZhiHui comprises – understanding the underlying the factors in the Beverages (Nonalcoholic) 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.
Ability to lead change in Beverages (Nonalcoholic)
– Hebei Yangyuan ZhiHui is one of the leading players in the Beverages (Nonalcoholic) industry in China. Over the years it has not only transformed the business landscape in the Beverages (Nonalcoholic) industry in China but also across the existing markets. The ability to lead change has enabled Hebei Yangyuan ZhiHui in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Learning organization
- Hebei Yangyuan ZhiHui 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 Hebei Yangyuan ZhiHui is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Hebei Yangyuan ZhiHui emphasize – knowledge, initiative, and innovation.
Strong track record of project management in the Beverages (Nonalcoholic) industry
– Hebei Yangyuan ZhiHui is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Digital Transformation in Beverages (Nonalcoholic) industry
- digital transformation varies from industry to industry. For Hebei Yangyuan ZhiHui digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Hebei Yangyuan ZhiHui 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.
Low bargaining power of suppliers
– Suppliers of Hebei Yangyuan ZhiHui in the Consumer/Non-Cyclical sector have low bargaining power. Hebei Yangyuan ZhiHui has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Hebei Yangyuan ZhiHui to manage not only supply disruptions but also source products at highly competitive prices.
Cross disciplinary teams
– Horizontal connected teams at the Hebei Yangyuan ZhiHui 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.
Weaknesses of Hebei Yangyuan ZhiHui | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Hebei Yangyuan ZhiHui are -
Employees’ less understanding of Hebei Yangyuan ZhiHui strategy
– From the outside it seems that the employees of Hebei Yangyuan ZhiHui 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 China, Hebei Yangyuan ZhiHui needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High dependence on Hebei Yangyuan ZhiHui ‘s star products
– The top 2 products and services of Hebei Yangyuan ZhiHui still accounts for major business revenue. This dependence on star products in Beverages (Nonalcoholic) industry has resulted into insufficient focus on developing new products, even though Hebei Yangyuan ZhiHui has relatively successful track record of launching new products.
Products dominated business model
– Even though Hebei Yangyuan ZhiHui has some of the most successful models in the Beverages (Nonalcoholic) industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Hebei Yangyuan ZhiHui 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 Hebei Yangyuan ZhiHui needs to have more collaboration between its sales team and marketing team. Sales professionals in the Beverages (Nonalcoholic) industry have deep experience in developing customer relationships. Marketing department at Hebei Yangyuan ZhiHui can leverage the sales team experience to cultivate customer relationships as Hebei Yangyuan ZhiHui is planning to shift buying processes online.
Interest costs
– Compare to the competition, Hebei Yangyuan ZhiHui has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Ability to respond to the competition
– As the decision making is very deliberative at Hebei Yangyuan ZhiHui, in the dynamic environment of Beverages (Nonalcoholic) industry it has struggled to respond to the nimble upstart competition. Hebei Yangyuan ZhiHui has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Workers concerns about automation
– As automation is fast increasing in the Beverages (Nonalcoholic) industry, Hebei Yangyuan ZhiHui 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.
High cash cycle compare to competitors
Hebei Yangyuan ZhiHui has a high cash cycle compare to other players in the Beverages (Nonalcoholic) industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Increasing silos among functional specialists
– The organizational structure of Hebei Yangyuan ZhiHui is dominated by functional specialists. It is not different from other players in the Beverages (Nonalcoholic) industry, but Hebei Yangyuan ZhiHui needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Hebei Yangyuan ZhiHui to focus more on services in the Beverages (Nonalcoholic) industry rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As Hebei Yangyuan ZhiHui is one of the leading players in the Beverages (Nonalcoholic) industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Beverages (Nonalcoholic) industry in last five years.
Hebei Yangyuan ZhiHui Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Hebei Yangyuan ZhiHui are -
Creating value in data economy
– The success of analytics program of Hebei Yangyuan ZhiHui has opened avenues for new revenue streams for the organization in Beverages (Nonalcoholic) industry. This can help Hebei Yangyuan ZhiHui to build a more holistic ecosystem for Hebei Yangyuan ZhiHui products in the Beverages (Nonalcoholic) industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at Hebei Yangyuan ZhiHui 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 Beverages (Nonalcoholic) industry.
Developing new processes and practices
– Hebei Yangyuan ZhiHui can develop new processes and procedures in Beverages (Nonalcoholic) 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Hebei Yangyuan ZhiHui 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, Hebei Yangyuan ZhiHui is facing challenges because of the dominance of functional experts in the organization. Hebei Yangyuan ZhiHui can utilize new technology in the field of Beverages (Nonalcoholic) industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Using analytics as competitive advantage
– Hebei Yangyuan ZhiHui has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Beverages (Nonalcoholic) sector. This continuous investment in analytics has enabled Hebei Yangyuan ZhiHui to build a competitive advantage using analytics. The analytics driven competitive advantage can help Hebei Yangyuan ZhiHui to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Hebei Yangyuan ZhiHui 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 Hebei Yangyuan ZhiHui 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.
Use of Bitcoin and other crypto currencies for transactions in Beverages (Nonalcoholic) industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Hebei Yangyuan ZhiHui in the Beverages (Nonalcoholic) industry. Now Hebei Yangyuan ZhiHui can target international markets with far fewer capital restrictions requirements than the existing system.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Hebei Yangyuan ZhiHui 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 Hebei Yangyuan ZhiHui to hire the very best people irrespective of their geographical location.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Beverages (Nonalcoholic) industry, but it has also influenced the consumer preferences. Hebei Yangyuan ZhiHui can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Loyalty marketing
– Hebei Yangyuan ZhiHui 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, Hebei Yangyuan ZhiHui can use these opportunities to build new business models that can help the communities that Hebei Yangyuan ZhiHui operates in. Secondly it can use opportunities from government spending in Beverages (Nonalcoholic) sector.
Threats Hebei Yangyuan ZhiHui External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Hebei Yangyuan ZhiHui are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Beverages (Nonalcoholic) industry are lowering. It can presents Hebei Yangyuan ZhiHui with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Beverages (Nonalcoholic) sector.
High dependence on third party suppliers
– Hebei Yangyuan ZhiHui 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Hebei Yangyuan ZhiHui 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 Hebei Yangyuan ZhiHui prominent markets.
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 Hebei Yangyuan ZhiHui.
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.
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 Hebei Yangyuan ZhiHui in the Beverages (Nonalcoholic) sector and impact the bottomline of the organization.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Hebei Yangyuan ZhiHui may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Beverages (Nonalcoholic) sector.
Environmental challenges
– Hebei Yangyuan ZhiHui 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. Hebei Yangyuan ZhiHui can take advantage of this fund but it will also bring new competitors in the Beverages (Nonalcoholic) industry.
Consumer confidence and its impact on Hebei Yangyuan ZhiHui 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 Beverages (Nonalcoholic) industry and other sectors.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Hebei Yangyuan ZhiHui in Beverages (Nonalcoholic) industry. The Beverages (Nonalcoholic) 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 Hebei Yangyuan ZhiHui is facing in Beverages (Nonalcoholic) sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Regulatory challenges
– Hebei Yangyuan ZhiHui 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 Beverages (Nonalcoholic) industry regulations.
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. Hebei Yangyuan ZhiHui needs to understand the core reasons impacting the Beverages (Nonalcoholic) industry. This will help it in building a better workplace.
Weighted SWOT Analysis of Hebei Yangyuan ZhiHui Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Hebei Yangyuan ZhiHui 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 Hebei Yangyuan ZhiHui 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 Hebei Yangyuan ZhiHui 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 Hebei Yangyuan ZhiHui 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 Hebei Yangyuan ZhiHui needs to make to build a sustainable competitive advantage.
