SWOT Analysis / TOWS Matrix for JUNEYAO Airlines (China)
Based on various researches at Oak Spring University , JUNEYAO Airlines is operating in a macro-environment that has been destablized by – increasing transportation and logistics costs, increasing energy prices, there is backlash against globalization, banking and financial system is disrupted by Bitcoin and other crypto currencies, competitive advantages are harder to sustain because of technology dispersion, increasing commodity prices, customer relationship management is fast transforming because of increasing concerns over data privacy,
increasing inequality as vast percentage of new income is going to the top 1%, increasing government debt because of Covid-19 spendings, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that JUNEYAO Airlines can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the JUNEYAO Airlines, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which JUNEYAO Airlines 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 JUNEYAO Airlines can be done for the following purposes –
1. Strategic planning of JUNEYAO Airlines
2. Improving business portfolio management of JUNEYAO Airlines
3. Assessing feasibility of the new initiative in China
4. Making a Airline sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of JUNEYAO Airlines
Strengths of JUNEYAO Airlines | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of JUNEYAO Airlines are -
Effective Research and Development (R&D)
– JUNEYAO Airlines has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – JUNEYAO Airlines staying ahead in the Airline industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Sustainable margins compare to other players in Airline industry
– JUNEYAO Airlines has clearly differentiated products in the market place. This has enabled JUNEYAO Airlines to fetch slight price premium compare to the competitors in the Airline industry. The sustainable margins have also helped JUNEYAO Airlines to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– JUNEYAO Airlines has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Airline industry. Secondly the value chain collaborators of JUNEYAO Airlines have helped the firm to develop new products and bring them quickly to the marketplace.
Diverse revenue streams
– JUNEYAO Airlines is present in almost all the verticals within the Airline industry. This has provided JUNEYAO Airlines 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 JUNEYAO Airlines 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.
Strong track record of project management in the Airline industry
– JUNEYAO Airlines is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Operational resilience
– The operational resilience strategy of JUNEYAO Airlines comprises – understanding the underlying the factors in the Airline 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.
Organizational Resilience of JUNEYAO Airlines
– The covid-19 pandemic has put organizational resilience at the centre of everthing JUNEYAO Airlines does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High brand equity
– JUNEYAO Airlines has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled JUNEYAO Airlines to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to lead change in Airline
– JUNEYAO Airlines is one of the leading players in the Airline industry in China. Over the years it has not only transformed the business landscape in the Airline industry in China but also across the existing markets. The ability to lead change has enabled JUNEYAO Airlines in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Successful track record of launching new products
– JUNEYAO Airlines has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. JUNEYAO Airlines 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.
Low bargaining power of suppliers
– Suppliers of JUNEYAO Airlines in the Transportation sector have low bargaining power. JUNEYAO Airlines has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps JUNEYAO Airlines to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses of JUNEYAO Airlines | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of JUNEYAO Airlines are -
Ability to respond to the competition
– As the decision making is very deliberative at JUNEYAO Airlines, in the dynamic environment of Airline industry it has struggled to respond to the nimble upstart competition. JUNEYAO Airlines has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Employees’ less understanding of JUNEYAO Airlines strategy
– From the outside it seems that the employees of JUNEYAO Airlines 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 JUNEYAO Airlines supply chain. Even after few cautionary changes, JUNEYAO Airlines is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left JUNEYAO Airlines vulnerable to further global disruptions in South East Asia.
Lack of clear differentiation of JUNEYAO Airlines products
– To increase the profitability and margins on the products, JUNEYAO Airlines needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, JUNEYAO Airlines is slow explore the new channels of communication. These new channels of communication can help JUNEYAO Airlines to provide better information regarding Airline products and services. It can also build an online community to further reach out to potential customers.
Increasing silos among functional specialists
– The organizational structure of JUNEYAO Airlines is dominated by functional specialists. It is not different from other players in the Airline industry, but JUNEYAO Airlines needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help JUNEYAO Airlines to focus more on services in the Airline industry rather than just following the product oriented approach.
Aligning sales with marketing
– From the outside it seems that JUNEYAO Airlines needs to have more collaboration between its sales team and marketing team. Sales professionals in the Airline industry have deep experience in developing customer relationships. Marketing department at JUNEYAO Airlines can leverage the sales team experience to cultivate customer relationships as JUNEYAO Airlines is planning to shift buying processes online.
Slow decision making process
– As mentioned earlier in the report, JUNEYAO Airlines has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Airline industry over the last five years. JUNEYAO Airlines 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.
High bargaining power of channel partners in Airline industry
– because of the regulatory requirements in China, JUNEYAO Airlines 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 Airline industry.
High dependence on JUNEYAO Airlines ‘s star products
– The top 2 products and services of JUNEYAO Airlines still accounts for major business revenue. This dependence on star products in Airline industry has resulted into insufficient focus on developing new products, even though JUNEYAO Airlines has relatively successful track record of launching new products.
Capital Spending Reduction
– Even during the low interest decade, JUNEYAO Airlines 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 Airline industry using digital technology.
JUNEYAO Airlines Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of JUNEYAO Airlines are -
Building a culture of innovation
– managers at JUNEYAO Airlines 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 Airline industry.
Creating value in data economy
– The success of analytics program of JUNEYAO Airlines has opened avenues for new revenue streams for the organization in Airline industry. This can help JUNEYAO Airlines to build a more holistic ecosystem for JUNEYAO Airlines products in the Airline industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Redefining models of collaboration and team work
– As explained in the weaknesses section, JUNEYAO Airlines is facing challenges because of the dominance of functional experts in the organization. JUNEYAO Airlines can utilize new technology in the field of Airline industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Better consumer reach
– The expansion of the 5G network will help JUNEYAO Airlines to increase its market reach. JUNEYAO Airlines 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, JUNEYAO Airlines 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 JUNEYAO Airlines to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for JUNEYAO Airlines 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 JUNEYAO Airlines to hire the very best people irrespective of their geographical location.
Manufacturing automation
– JUNEYAO Airlines can use the latest technology developments to improve its manufacturing and designing process in Airline 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, JUNEYAO Airlines can use these opportunities to build new business models that can help the communities that JUNEYAO Airlines operates in. Secondly it can use opportunities from government spending in Airline sector.
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 JUNEYAO Airlines 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.
Buying journey improvements
– JUNEYAO Airlines can improve the customer journey of consumers in the Airline 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for JUNEYAO Airlines in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Airline industry, and it will provide faster access to the consumers.
Leveraging digital technologies
– JUNEYAO Airlines 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.
Developing new processes and practices
– JUNEYAO Airlines can develop new processes and procedures in Airline 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.
Threats JUNEYAO Airlines External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of JUNEYAO Airlines are -
High dependence on third party suppliers
– JUNEYAO Airlines 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.
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. JUNEYAO Airlines 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, JUNEYAO Airlines may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Airline sector.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for JUNEYAO Airlines in Airline industry. The Airline 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.
Environmental challenges
– JUNEYAO Airlines 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. JUNEYAO Airlines can take advantage of this fund but it will also bring new competitors in the Airline industry.
Increasing wage structure of JUNEYAO Airlines
– 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 JUNEYAO Airlines.
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.
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 JUNEYAO Airlines in the Airline sector and impact the bottomline of the organization.
Regulatory challenges
– JUNEYAO Airlines 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 Airline industry regulations.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, JUNEYAO Airlines 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 JUNEYAO Airlines prominent markets.
Technology acceleration in Forth Industrial Revolution
– JUNEYAO Airlines has witnessed rapid integration of technology during Covid-19 in the Airline industry. As one of the leading players in the industry, JUNEYAO Airlines needs to keep up with the evolution of technology in the Airline 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.
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 JUNEYAO Airlines.
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 JUNEYAO Airlines Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at JUNEYAO Airlines 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 JUNEYAO Airlines 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 JUNEYAO Airlines 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 JUNEYAO Airlines 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 JUNEYAO Airlines needs to make to build a sustainable competitive advantage.
