Yunnan Chuangxin New Material (2812) SWOT Analysis / TOWS Matrix / MBA Resources
Containers & Packaging
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Yunnan Chuangxin New Material (China)
Based on various researches at Oak Spring University , Yunnan Chuangxin New Material is operating in a macro-environment that has been destablized by – increasing energy prices, increasing household debt because of falling income levels, talent flight as more people leaving formal jobs, wage bills are increasing, competitive advantages are harder to sustain because of technology dispersion, there is backlash against globalization, increasing commodity prices,
digital marketing is dominated by two big players Facebook and Google, banking and financial system is disrupted by Bitcoin and other crypto currencies, etc
Introduction to SWOT Analysis of Yunnan Chuangxin New Material
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Yunnan Chuangxin New Material can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Yunnan Chuangxin New Material, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Yunnan Chuangxin New Material 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 Yunnan Chuangxin New Material can be done for the following purposes –
1. Strategic planning of Yunnan Chuangxin New Material
2. Improving business portfolio management of Yunnan Chuangxin New Material
3. Assessing feasibility of the new initiative in China
4. Making a Containers & Packaging sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Yunnan Chuangxin New Material
Strengths of Yunnan Chuangxin New Material | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Yunnan Chuangxin New Material are -
Operational resilience
– The operational resilience strategy of Yunnan Chuangxin New Material comprises – understanding the underlying the factors in the Containers & Packaging 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.
Innovation driven organization
– Yunnan Chuangxin New Material is one of the most innovative firm in Containers & Packaging sector.
Low bargaining power of suppliers
– Suppliers of Yunnan Chuangxin New Material in the Basic Materials sector have low bargaining power. Yunnan Chuangxin New Material has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Yunnan Chuangxin New Material to manage not only supply disruptions but also source products at highly competitive prices.
Cross disciplinary teams
– Horizontal connected teams at the Yunnan Chuangxin New Material 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
– Yunnan Chuangxin New Material 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.
Effective Research and Development (R&D)
– Yunnan Chuangxin New Material has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Yunnan Chuangxin New Material staying ahead in the Containers & Packaging industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Diverse revenue streams
– Yunnan Chuangxin New Material is present in almost all the verticals within the Containers & Packaging industry. This has provided Yunnan Chuangxin New Material 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 brand equity
– Yunnan Chuangxin New Material has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Yunnan Chuangxin New Material to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Organizational Resilience of Yunnan Chuangxin New Material
– The covid-19 pandemic has put organizational resilience at the centre of everthing Yunnan Chuangxin New Material does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Yunnan Chuangxin New Material is one of the leading players in the Containers & Packaging 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.
Learning organization
- Yunnan Chuangxin New Material 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 Yunnan Chuangxin New Material is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Yunnan Chuangxin New Material emphasize – knowledge, initiative, and innovation.
Strong track record of project management in the Containers & Packaging industry
– Yunnan Chuangxin New Material is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses of Yunnan Chuangxin New Material | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Yunnan Chuangxin New Material are -
Increasing silos among functional specialists
– The organizational structure of Yunnan Chuangxin New Material is dominated by functional specialists. It is not different from other players in the Containers & Packaging industry, but Yunnan Chuangxin New Material needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Yunnan Chuangxin New Material to focus more on services in the Containers & Packaging industry rather than just following the product oriented approach.
Skills based hiring in Containers & Packaging industry
– The stress on hiring functional specialists at Yunnan Chuangxin New Material 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.
Slow to strategic competitive environment developments
– As Yunnan Chuangxin New Material is one of the leading players in the Containers & Packaging industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Containers & Packaging industry in last five years.
Need for greater diversity
– Yunnan Chuangxin New Material 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.
No frontier risks strategy
– From the 10K / annual statement of Yunnan Chuangxin New Material, it seems that company is thinking out the frontier risks that can impact Containers & Packaging 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.
Products dominated business model
– Even though Yunnan Chuangxin New Material has some of the most successful models in the Containers & Packaging industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Yunnan Chuangxin New Material should strive to include more intangible value offerings along with its core products and services.
Employees’ less understanding of Yunnan Chuangxin New Material strategy
– From the outside it seems that the employees of Yunnan Chuangxin New Material 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.
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 Yunnan Chuangxin New Material supply chain. Even after few cautionary changes, Yunnan Chuangxin New Material is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Yunnan Chuangxin New Material vulnerable to further global disruptions in South East Asia.
High dependence on Yunnan Chuangxin New Material ‘s star products
– The top 2 products and services of Yunnan Chuangxin New Material still accounts for major business revenue. This dependence on star products in Containers & Packaging industry has resulted into insufficient focus on developing new products, even though Yunnan Chuangxin New Material has relatively successful track record of launching new products.
Compensation and incentives
– The revenue per employee of Yunnan Chuangxin New Material is just above the Containers & Packaging 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.
High cash cycle compare to competitors
Yunnan Chuangxin New Material has a high cash cycle compare to other players in the Containers & Packaging industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Yunnan Chuangxin New Material Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Yunnan Chuangxin New Material are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Yunnan Chuangxin New Material is facing challenges because of the dominance of functional experts in the organization. Yunnan Chuangxin New Material can utilize new technology in the field of Containers & Packaging industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Developing new processes and practices
– Yunnan Chuangxin New Material can develop new processes and procedures in Containers & Packaging 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.
Better consumer reach
– The expansion of the 5G network will help Yunnan Chuangxin New Material to increase its market reach. Yunnan Chuangxin New Material 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Yunnan Chuangxin New Material 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 Yunnan Chuangxin New Material to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Yunnan Chuangxin New Material can use these opportunities to build new business models that can help the communities that Yunnan Chuangxin New Material operates in. Secondly it can use opportunities from government spending in Containers & Packaging sector.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Containers & Packaging industry, but it has also influenced the consumer preferences. Yunnan Chuangxin New Material can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Building a culture of innovation
– managers at Yunnan Chuangxin New Material 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 Containers & Packaging industry.
Using analytics as competitive advantage
– Yunnan Chuangxin New Material has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Containers & Packaging sector. This continuous investment in analytics has enabled Yunnan Chuangxin New Material to build a competitive advantage using analytics. The analytics driven competitive advantage can help Yunnan Chuangxin New Material to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Yunnan Chuangxin New Material 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 Yunnan Chuangxin New Material to hire the very best people irrespective of their geographical location.
Learning at scale
– Online learning technologies has now opened space for Yunnan Chuangxin New Material 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.
Buying journey improvements
– Yunnan Chuangxin New Material can improve the customer journey of consumers in the Containers & Packaging 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.
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 Yunnan Chuangxin New Material 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.
Leveraging digital technologies
– Yunnan Chuangxin New Material 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.
Threats Yunnan Chuangxin New Material External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Yunnan Chuangxin New Material are -
Stagnating economy with rate increase
– Yunnan Chuangxin New Material 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 Containers & Packaging industry.
Technology acceleration in Forth Industrial Revolution
– Yunnan Chuangxin New Material has witnessed rapid integration of technology during Covid-19 in the Containers & Packaging industry. As one of the leading players in the industry, Yunnan Chuangxin New Material needs to keep up with the evolution of technology in the Containers & Packaging 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 international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Yunnan Chuangxin New Material 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 Yunnan Chuangxin New Material prominent markets.
Increasing wage structure of Yunnan Chuangxin New Material
– 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 Yunnan Chuangxin New Material.
Easy access to finance
– Easy access to finance in Containers & Packaging industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Yunnan Chuangxin New Material can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
Shortening product life cycle
– it is one of the major threat that Yunnan Chuangxin New Material is facing in Containers & Packaging sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Yunnan Chuangxin New Material 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.
Environmental challenges
– Yunnan Chuangxin New Material 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. Yunnan Chuangxin New Material can take advantage of this fund but it will also bring new competitors in the Containers & Packaging industry.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Containers & Packaging industry are lowering. It can presents Yunnan Chuangxin New Material with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Containers & Packaging sector.
High dependence on third party suppliers
– Yunnan Chuangxin New Material 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.
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.
Regulatory challenges
– Yunnan Chuangxin New Material 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 Containers & Packaging industry regulations.
Weighted SWOT Analysis of Yunnan Chuangxin New Material Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Yunnan Chuangxin New Material 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 Yunnan Chuangxin New Material 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 Yunnan Chuangxin New Material 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 Yunnan Chuangxin New Material 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 Yunnan Chuangxin New Material needs to make to build a sustainable competitive advantage.