COSCO Shipping Energy Trans (600026) SWOT Analysis / TOWS Matrix / MBA Resources
Water Transportation
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for COSCO Shipping Energy Trans (China)
Based on various researches at Oak Spring University , COSCO Shipping Energy Trans is operating in a macro-environment that has been destablized by – digital marketing is dominated by two big players Facebook and Google, supply chains are disrupted by pandemic , banking and financial system is disrupted by Bitcoin and other crypto currencies, cloud computing is disrupting traditional business models, 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 transportation and logistics costs,
increasing energy prices, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of COSCO Shipping Energy Trans
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that COSCO Shipping Energy Trans can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the COSCO Shipping Energy Trans, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which COSCO Shipping Energy Trans 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 COSCO Shipping Energy Trans can be done for the following purposes –
1. Strategic planning of COSCO Shipping Energy Trans
2. Improving business portfolio management of COSCO Shipping Energy Trans
3. Assessing feasibility of the new initiative in China
4. Making a Water Transportation sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of COSCO Shipping Energy Trans
Strengths of COSCO Shipping Energy Trans | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of COSCO Shipping Energy Trans are -
Strong track record of project management in the Water Transportation industry
– COSCO Shipping Energy Trans is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Digital Transformation in Water Transportation industry
- digital transformation varies from industry to industry. For COSCO Shipping Energy Trans digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. COSCO Shipping Energy Trans 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.
Successful track record of launching new products
– COSCO Shipping Energy Trans has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. COSCO Shipping Energy Trans 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.
Highly skilled collaborators
– COSCO Shipping Energy Trans has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Water Transportation industry. Secondly the value chain collaborators of COSCO Shipping Energy Trans have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of COSCO Shipping Energy Trans
– The covid-19 pandemic has put organizational resilience at the centre of everthing COSCO Shipping Energy Trans does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Operational resilience
– The operational resilience strategy of COSCO Shipping Energy Trans comprises – understanding the underlying the factors in the Water Transportation 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.
Diverse revenue streams
– COSCO Shipping Energy Trans is present in almost all the verticals within the Water Transportation industry. This has provided COSCO Shipping Energy Trans 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
– COSCO Shipping Energy Trans has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled COSCO Shipping Energy Trans to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Effective Research and Development (R&D)
– COSCO Shipping Energy Trans has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – COSCO Shipping Energy Trans staying ahead in the Water Transportation industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Learning organization
- COSCO Shipping Energy Trans 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 COSCO Shipping Energy Trans is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at COSCO Shipping Energy Trans emphasize – knowledge, initiative, and innovation.
Training and development
– COSCO Shipping Energy Trans 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.
Innovation driven organization
– COSCO Shipping Energy Trans is one of the most innovative firm in Water Transportation sector.
Weaknesses of COSCO Shipping Energy Trans | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of COSCO Shipping Energy Trans are -
Increasing silos among functional specialists
– The organizational structure of COSCO Shipping Energy Trans is dominated by functional specialists. It is not different from other players in the Water Transportation industry, but COSCO Shipping Energy Trans needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help COSCO Shipping Energy Trans to focus more on services in the Water Transportation industry rather than just following the product oriented approach.
High operating costs
– Compare to the competitors, COSCO Shipping Energy Trans has high operating costs in the Water Transportation industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract COSCO Shipping Energy Trans lucrative customers.
Skills based hiring in Water Transportation industry
– The stress on hiring functional specialists at COSCO Shipping Energy Trans 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 decision making process
– As mentioned earlier in the report, COSCO Shipping Energy Trans has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Water Transportation industry over the last five years. COSCO Shipping Energy Trans 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.
Compensation and incentives
– The revenue per employee of COSCO Shipping Energy Trans is just above the Water Transportation 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 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 COSCO Shipping Energy Trans supply chain. Even after few cautionary changes, COSCO Shipping Energy Trans is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left COSCO Shipping Energy Trans vulnerable to further global disruptions in South East Asia.
Low market penetration in new markets
– Outside its home market of China, COSCO Shipping Energy Trans needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Aligning sales with marketing
– From the outside it seems that COSCO Shipping Energy Trans needs to have more collaboration between its sales team and marketing team. Sales professionals in the Water Transportation industry have deep experience in developing customer relationships. Marketing department at COSCO Shipping Energy Trans can leverage the sales team experience to cultivate customer relationships as COSCO Shipping Energy Trans is planning to shift buying processes online.
Need for greater diversity
– COSCO Shipping Energy Trans 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 COSCO Shipping Energy Trans is one of the leading players in the Water Transportation industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Water Transportation industry in last five years.
Employees’ less understanding of COSCO Shipping Energy Trans strategy
– From the outside it seems that the employees of COSCO Shipping Energy Trans 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.
COSCO Shipping Energy Trans Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of COSCO Shipping Energy Trans are -
Developing new processes and practices
– COSCO Shipping Energy Trans can develop new processes and procedures in Water Transportation 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 COSCO Shipping Energy Trans to increase its market reach. COSCO Shipping Energy Trans 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Water Transportation industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. COSCO Shipping Energy Trans 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. COSCO Shipping Energy Trans 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.
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 COSCO Shipping Energy Trans 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.
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. COSCO Shipping Energy Trans can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects COSCO Shipping Energy Trans can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Leveraging digital technologies
– COSCO Shipping Energy Trans 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, COSCO Shipping Energy Trans 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 COSCO Shipping Energy Trans to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Manufacturing automation
– COSCO Shipping Energy Trans can use the latest technology developments to improve its manufacturing and designing process in Water Transportation 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.
Learning at scale
– Online learning technologies has now opened space for COSCO Shipping Energy Trans 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.
Using analytics as competitive advantage
– COSCO Shipping Energy Trans has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Water Transportation sector. This continuous investment in analytics has enabled COSCO Shipping Energy Trans to build a competitive advantage using analytics. The analytics driven competitive advantage can help COSCO Shipping Energy Trans to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, COSCO Shipping Energy Trans can use these opportunities to build new business models that can help the communities that COSCO Shipping Energy Trans operates in. Secondly it can use opportunities from government spending in Water Transportation sector.
Lowering marketing communication costs
– 5G expansion will open new opportunities for COSCO Shipping Energy Trans in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Water Transportation industry, and it will provide faster access to the consumers.
Threats COSCO Shipping Energy Trans External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of COSCO Shipping Energy Trans are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, COSCO Shipping Energy Trans 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 COSCO Shipping Energy Trans prominent markets.
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
– COSCO Shipping Energy Trans 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 Water Transportation industry regulations.
Easy access to finance
– Easy access to finance in Water Transportation industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. COSCO Shipping Energy Trans can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 COSCO Shipping Energy Trans business can come under increasing regulations regarding data privacy, data security, etc.
Increasing wage structure of COSCO Shipping Energy Trans
– 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 COSCO Shipping Energy Trans.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, COSCO Shipping Energy Trans may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Water Transportation sector.
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 COSCO Shipping Energy Trans.
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 COSCO Shipping Energy Trans in the Water Transportation sector and impact the bottomline of the organization.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Water Transportation industry are lowering. It can presents COSCO Shipping Energy Trans with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Water Transportation sector.
Technology acceleration in Forth Industrial Revolution
– COSCO Shipping Energy Trans has witnessed rapid integration of technology during Covid-19 in the Water Transportation industry. As one of the leading players in the industry, COSCO Shipping Energy Trans needs to keep up with the evolution of technology in the Water Transportation 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.
High dependence on third party suppliers
– COSCO Shipping Energy Trans 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.
Weighted SWOT Analysis of COSCO Shipping Energy Trans Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at COSCO Shipping Energy Trans 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 COSCO Shipping Energy Trans 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 COSCO Shipping Energy Trans 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 COSCO Shipping Energy Trans 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 COSCO Shipping Energy Trans needs to make to build a sustainable competitive advantage.