SWOT Analysis / TOWS Matrix for Zhejiang Huayou Cobalt (China)
Based on various researches at Oak Spring University , Zhejiang Huayou Cobalt is operating in a macro-environment that has been destablized by – central banks are concerned over increasing inflation, increasing household debt because of falling income levels, geopolitical disruptions, cloud computing is disrupting traditional business models, digital marketing is dominated by two big players Facebook and Google, there is backlash against globalization, there is increasing trade war between United States & China,
increasing energy prices, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Zhejiang Huayou Cobalt
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Zhejiang Huayou Cobalt can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Zhejiang Huayou Cobalt, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Zhejiang Huayou Cobalt 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 Zhejiang Huayou Cobalt can be done for the following purposes –
1. Strategic planning of Zhejiang Huayou Cobalt
2. Improving business portfolio management of Zhejiang Huayou Cobalt
3. Assessing feasibility of the new initiative in China
4. Making a Metal Mining sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Zhejiang Huayou Cobalt
Strengths of Zhejiang Huayou Cobalt | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Zhejiang Huayou Cobalt are -
Cross disciplinary teams
– Horizontal connected teams at the Zhejiang Huayou Cobalt 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.
High switching costs
– The high switching costs that Zhejiang Huayou Cobalt 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.
Ability to recruit top talent
– Zhejiang Huayou Cobalt is one of the leading players in the Metal Mining 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.
Innovation driven organization
– Zhejiang Huayou Cobalt is one of the most innovative firm in Metal Mining sector.
Learning organization
- Zhejiang Huayou Cobalt 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 Zhejiang Huayou Cobalt is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Zhejiang Huayou Cobalt emphasize – knowledge, initiative, and innovation.
Training and development
– Zhejiang Huayou Cobalt has one of the best training and development program in Basic Materials 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.
Strong track record of project management in the Metal Mining industry
– Zhejiang Huayou Cobalt is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Organizational Resilience of Zhejiang Huayou Cobalt
– The covid-19 pandemic has put organizational resilience at the centre of everthing Zhejiang Huayou Cobalt does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Digital Transformation in Metal Mining industry
- digital transformation varies from industry to industry. For Zhejiang Huayou Cobalt digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Zhejiang Huayou Cobalt 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.
Highly skilled collaborators
– Zhejiang Huayou Cobalt has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Metal Mining industry. Secondly the value chain collaborators of Zhejiang Huayou Cobalt have helped the firm to develop new products and bring them quickly to the marketplace.
Analytics focus
– Zhejiang Huayou Cobalt 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 Metal Mining industry. The technology infrastructure of China 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.
Successful track record of launching new products
– Zhejiang Huayou Cobalt has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Zhejiang Huayou Cobalt 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.
Weaknesses of Zhejiang Huayou Cobalt | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Zhejiang Huayou Cobalt are -
Employees’ less understanding of Zhejiang Huayou Cobalt strategy
– From the outside it seems that the employees of Zhejiang Huayou Cobalt 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.
Need for greater diversity
– Zhejiang Huayou Cobalt 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.
Slow to strategic competitive environment developments
– As Zhejiang Huayou Cobalt is one of the leading players in the Metal Mining industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Metal Mining industry in last five years.
Interest costs
– Compare to the competition, Zhejiang Huayou Cobalt 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.
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 Zhejiang Huayou Cobalt supply chain. Even after few cautionary changes, Zhejiang Huayou Cobalt is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Zhejiang Huayou Cobalt vulnerable to further global disruptions in South East Asia.
High bargaining power of channel partners in Metal Mining industry
– because of the regulatory requirements in China, Zhejiang Huayou Cobalt 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 Metal Mining industry.
Lack of clear differentiation of Zhejiang Huayou Cobalt products
– To increase the profitability and margins on the products, Zhejiang Huayou Cobalt 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 Zhejiang Huayou Cobalt, in the dynamic environment of Metal Mining industry it has struggled to respond to the nimble upstart competition. Zhejiang Huayou Cobalt has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow decision making process
– As mentioned earlier in the report, Zhejiang Huayou Cobalt has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Metal Mining industry over the last five years. Zhejiang Huayou Cobalt 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.
Low market penetration in new markets
– Outside its home market of China, Zhejiang Huayou Cobalt needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High cash cycle compare to competitors
Zhejiang Huayou Cobalt has a high cash cycle compare to other players in the Metal Mining industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Zhejiang Huayou Cobalt Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Zhejiang Huayou Cobalt are -
Use of Bitcoin and other crypto currencies for transactions in Metal Mining industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Zhejiang Huayou Cobalt in the Metal Mining industry. Now Zhejiang Huayou Cobalt can target international markets with far fewer capital restrictions requirements than the existing system.
Using analytics as competitive advantage
– Zhejiang Huayou Cobalt has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Metal Mining sector. This continuous investment in analytics has enabled Zhejiang Huayou Cobalt to build a competitive advantage using analytics. The analytics driven competitive advantage can help Zhejiang Huayou Cobalt to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Building a culture of innovation
– managers at Zhejiang Huayou Cobalt 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 Metal Mining industry.
Loyalty marketing
– Zhejiang Huayou Cobalt 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.
Manufacturing automation
– Zhejiang Huayou Cobalt can use the latest technology developments to improve its manufacturing and designing process in Metal Mining sector. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Metal Mining industry, but it has also influenced the consumer preferences. Zhejiang Huayou Cobalt 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
– Zhejiang Huayou Cobalt 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 Metal Mining industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Zhejiang Huayou Cobalt 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. Zhejiang Huayou Cobalt 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.
Better consumer reach
– The expansion of the 5G network will help Zhejiang Huayou Cobalt to increase its market reach. Zhejiang Huayou Cobalt 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.
Creating value in data economy
– The success of analytics program of Zhejiang Huayou Cobalt has opened avenues for new revenue streams for the organization in Metal Mining industry. This can help Zhejiang Huayou Cobalt to build a more holistic ecosystem for Zhejiang Huayou Cobalt products in the Metal Mining industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Developing new processes and practices
– Zhejiang Huayou Cobalt can develop new processes and procedures in Metal Mining 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Zhejiang Huayou Cobalt in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Metal Mining 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, Zhejiang Huayou Cobalt can use these opportunities to build new business models that can help the communities that Zhejiang Huayou Cobalt operates in. Secondly it can use opportunities from government spending in Metal Mining sector.
Threats Zhejiang Huayou Cobalt External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Zhejiang Huayou Cobalt are -
Stagnating economy with rate increase
– Zhejiang Huayou Cobalt 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 Metal Mining industry.
Easy access to finance
– Easy access to finance in Metal Mining industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Zhejiang Huayou Cobalt can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Zhejiang Huayou Cobalt may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Metal Mining sector.
Shortening product life cycle
– it is one of the major threat that Zhejiang Huayou Cobalt is facing in Metal Mining sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Zhejiang Huayou Cobalt in Metal Mining industry. The Metal Mining 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.
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.
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. Zhejiang Huayou Cobalt needs to understand the core reasons impacting the Metal Mining industry. This will help it in building a better workplace.
Increasing wage structure of Zhejiang Huayou Cobalt
– 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 Zhejiang Huayou Cobalt.
Regulatory challenges
– Zhejiang Huayou Cobalt 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 Metal Mining industry regulations.
Environmental challenges
– Zhejiang Huayou Cobalt 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. Zhejiang Huayou Cobalt can take advantage of this fund but it will also bring new competitors in the Metal Mining industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Zhejiang Huayou Cobalt 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 Zhejiang Huayou Cobalt prominent markets.
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. Zhejiang Huayou Cobalt 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.
Technology acceleration in Forth Industrial Revolution
– Zhejiang Huayou Cobalt has witnessed rapid integration of technology during Covid-19 in the Metal Mining industry. As one of the leading players in the industry, Zhejiang Huayou Cobalt needs to keep up with the evolution of technology in the Metal Mining 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.
Weighted SWOT Analysis of Zhejiang Huayou Cobalt Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Zhejiang Huayou Cobalt 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 Zhejiang Huayou Cobalt 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 Zhejiang Huayou Cobalt 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 Zhejiang Huayou Cobalt 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 Zhejiang Huayou Cobalt needs to make to build a sustainable competitive advantage.
