SWOT Analysis / TOWS Matrix for Baotou Beifang Chuangye (China)
Based on various researches at Oak Spring University , Baotou Beifang Chuangye is operating in a macro-environment that has been destablized by – increasing household debt because of falling income levels, technology disruption, central banks are concerned over increasing inflation, wage bills are increasing, customer relationship management is fast transforming because of increasing concerns over data privacy, digital marketing is dominated by two big players Facebook and Google, increasing inequality as vast percentage of new income is going to the top 1%,
banking and financial system is disrupted by Bitcoin and other crypto currencies, there is backlash against globalization, etc
Introduction to SWOT Analysis of Baotou Beifang Chuangye
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Baotou Beifang Chuangye can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Baotou Beifang Chuangye, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Baotou Beifang Chuangye 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 Baotou Beifang Chuangye can be done for the following purposes –
1. Strategic planning of Baotou Beifang Chuangye
2. Improving business portfolio management of Baotou Beifang Chuangye
3. Assessing feasibility of the new initiative in China
4. Making a Railroads sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Baotou Beifang Chuangye
Strengths of Baotou Beifang Chuangye | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Baotou Beifang Chuangye are -
High brand equity
– Baotou Beifang Chuangye has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Baotou Beifang Chuangye to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Training and development
– Baotou Beifang Chuangye has one of the best training and development program in Transportation 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.
Analytics focus
– Baotou Beifang Chuangye 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 Railroads 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.
Ability to lead change in Railroads
– Baotou Beifang Chuangye is one of the leading players in the Railroads industry in China. Over the years it has not only transformed the business landscape in the Railroads industry in China but also across the existing markets. The ability to lead change has enabled Baotou Beifang Chuangye in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Strong track record of project management in the Railroads industry
– Baotou Beifang Chuangye is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Cross disciplinary teams
– Horizontal connected teams at the Baotou Beifang Chuangye 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.
Learning organization
- Baotou Beifang Chuangye 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 Baotou Beifang Chuangye is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Baotou Beifang Chuangye emphasize – knowledge, initiative, and innovation.
High switching costs
– The high switching costs that Baotou Beifang Chuangye 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.
Innovation driven organization
– Baotou Beifang Chuangye is one of the most innovative firm in Railroads sector.
Highly skilled collaborators
– Baotou Beifang Chuangye has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Railroads industry. Secondly the value chain collaborators of Baotou Beifang Chuangye have helped the firm to develop new products and bring them quickly to the marketplace.
Sustainable margins compare to other players in Railroads industry
– Baotou Beifang Chuangye has clearly differentiated products in the market place. This has enabled Baotou Beifang Chuangye to fetch slight price premium compare to the competitors in the Railroads industry. The sustainable margins have also helped Baotou Beifang Chuangye to invest into research and development (R&D) and innovation.
Superior customer experience
– The customer experience strategy of Baotou Beifang Chuangye in Railroads industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses of Baotou Beifang Chuangye | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Baotou Beifang Chuangye are -
Increasing silos among functional specialists
– The organizational structure of Baotou Beifang Chuangye is dominated by functional specialists. It is not different from other players in the Railroads industry, but Baotou Beifang Chuangye needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Baotou Beifang Chuangye to focus more on services in the Railroads industry rather than just following the product oriented approach.
Compensation and incentives
– The revenue per employee of Baotou Beifang Chuangye is just above the Railroads 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.
Employees’ less understanding of Baotou Beifang Chuangye strategy
– From the outside it seems that the employees of Baotou Beifang Chuangye 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 cash cycle compare to competitors
Baotou Beifang Chuangye has a high cash cycle compare to other players in the Railroads industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Aligning sales with marketing
– From the outside it seems that Baotou Beifang Chuangye needs to have more collaboration between its sales team and marketing team. Sales professionals in the Railroads industry have deep experience in developing customer relationships. Marketing department at Baotou Beifang Chuangye can leverage the sales team experience to cultivate customer relationships as Baotou Beifang Chuangye is planning to shift buying processes online.
Ability to respond to the competition
– As the decision making is very deliberative at Baotou Beifang Chuangye, in the dynamic environment of Railroads industry it has struggled to respond to the nimble upstart competition. Baotou Beifang Chuangye has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High operating costs
– Compare to the competitors, Baotou Beifang Chuangye has high operating costs in the Railroads industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Baotou Beifang Chuangye lucrative customers.
Low market penetration in new markets
– Outside its home market of China, Baotou Beifang Chuangye needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High bargaining power of channel partners in Railroads industry
– because of the regulatory requirements in China, Baotou Beifang Chuangye 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 Railroads industry.
Lack of clear differentiation of Baotou Beifang Chuangye products
– To increase the profitability and margins on the products, Baotou Beifang Chuangye needs to provide more differentiated products than what it is currently offering in the marketplace.
Products dominated business model
– Even though Baotou Beifang Chuangye has some of the most successful models in the Railroads industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Baotou Beifang Chuangye should strive to include more intangible value offerings along with its core products and services.
Baotou Beifang Chuangye Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Baotou Beifang Chuangye are -
Developing new processes and practices
– Baotou Beifang Chuangye can develop new processes and procedures in Railroads 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.
Creating value in data economy
– The success of analytics program of Baotou Beifang Chuangye has opened avenues for new revenue streams for the organization in Railroads industry. This can help Baotou Beifang Chuangye to build a more holistic ecosystem for Baotou Beifang Chuangye products in the Railroads industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at Baotou Beifang Chuangye 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 Railroads industry.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Baotou Beifang Chuangye 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 Baotou Beifang Chuangye to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Baotou Beifang Chuangye can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Baotou Beifang Chuangye is facing challenges because of the dominance of functional experts in the organization. Baotou Beifang Chuangye can utilize new technology in the field of Railroads industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Use of Bitcoin and other crypto currencies for transactions in Railroads industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Baotou Beifang Chuangye in the Railroads industry. Now Baotou Beifang Chuangye 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 Baotou Beifang Chuangye 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 Baotou Beifang Chuangye 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 Railroads industry, but it has also influenced the consumer preferences. Baotou Beifang Chuangye can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Baotou Beifang Chuangye can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Railroads industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Baotou Beifang Chuangye 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. Baotou Beifang Chuangye 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 Baotou Beifang Chuangye to increase its market reach. Baotou Beifang Chuangye 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.
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 Baotou Beifang Chuangye 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.
Threats Baotou Beifang Chuangye External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Baotou Beifang Chuangye are -
Stagnating economy with rate increase
– Baotou Beifang Chuangye 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 Railroads industry.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Baotou Beifang Chuangye business can come under increasing regulations regarding data privacy, data security, etc.
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 Baotou Beifang Chuangye.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Baotou Beifang Chuangye may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Railroads sector.
Easy access to finance
– Easy access to finance in Railroads industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Baotou Beifang Chuangye can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Environmental challenges
– Baotou Beifang Chuangye 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. Baotou Beifang Chuangye can take advantage of this fund but it will also bring new competitors in the Railroads industry.
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 Baotou Beifang Chuangye in the Railroads sector and impact the bottomline of the organization.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Railroads industry are lowering. It can presents Baotou Beifang Chuangye with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Railroads sector.
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. Baotou Beifang Chuangye needs to understand the core reasons impacting the Railroads industry. This will help it in building a better workplace.
High dependence on third party suppliers
– Baotou Beifang Chuangye 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, Baotou Beifang Chuangye 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 Baotou Beifang Chuangye prominent markets.
Consumer confidence and its impact on Baotou Beifang Chuangye 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 Railroads industry and other sectors.
Weighted SWOT Analysis of Baotou Beifang Chuangye Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Baotou Beifang Chuangye 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 Baotou Beifang Chuangye 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 Baotou Beifang Chuangye 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 Baotou Beifang Chuangye 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 Baotou Beifang Chuangye needs to make to build a sustainable competitive advantage.