Qingdao TGOOD Electric (300001) SWOT Analysis / TOWS Matrix / MBA Resources
Electronic Instr. & Controls
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Qingdao TGOOD Electric (China)
Based on various researches at Oak Spring University , Qingdao TGOOD Electric is operating in a macro-environment that has been destablized by – cloud computing is disrupting traditional business models, digital marketing is dominated by two big players Facebook and Google, geopolitical disruptions, there is backlash against globalization, competitive advantages are harder to sustain because of technology dispersion, challanges to central banks by blockchain based private currencies, increasing energy prices,
technology disruption, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Qingdao TGOOD Electric
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Qingdao TGOOD Electric can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Qingdao TGOOD Electric, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Qingdao TGOOD Electric 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 Qingdao TGOOD Electric can be done for the following purposes –
1. Strategic planning of Qingdao TGOOD Electric
2. Improving business portfolio management of Qingdao TGOOD Electric
3. Assessing feasibility of the new initiative in China
4. Making a Electronic Instr. & Controls sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Qingdao TGOOD Electric
Strengths of Qingdao TGOOD Electric | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Qingdao TGOOD Electric are -
Learning organization
- Qingdao TGOOD Electric 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 Qingdao TGOOD Electric is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Qingdao TGOOD Electric emphasize – knowledge, initiative, and innovation.
High switching costs
– The high switching costs that Qingdao TGOOD Electric has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Ability to lead change in Electronic Instr. & Controls
– Qingdao TGOOD Electric is one of the leading players in the Electronic Instr. & Controls industry in China. Over the years it has not only transformed the business landscape in the Electronic Instr. & Controls industry in China but also across the existing markets. The ability to lead change has enabled Qingdao TGOOD Electric in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Diverse revenue streams
– Qingdao TGOOD Electric is present in almost all the verticals within the Electronic Instr. & Controls industry. This has provided Qingdao TGOOD Electric 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.
Cross disciplinary teams
– Horizontal connected teams at the Qingdao TGOOD Electric are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
High brand equity
– Qingdao TGOOD Electric has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Qingdao TGOOD Electric to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in Electronic Instr. & Controls industry
– Qingdao TGOOD Electric has clearly differentiated products in the market place. This has enabled Qingdao TGOOD Electric to fetch slight price premium compare to the competitors in the Electronic Instr. & Controls industry. The sustainable margins have also helped Qingdao TGOOD Electric to invest into research and development (R&D) and innovation.
Effective Research and Development (R&D)
– Qingdao TGOOD Electric has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Qingdao TGOOD Electric staying ahead in the Electronic Instr. & Controls industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Highly skilled collaborators
– Qingdao TGOOD Electric has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Electronic Instr. & Controls industry. Secondly the value chain collaborators of Qingdao TGOOD Electric have helped the firm to develop new products and bring them quickly to the marketplace.
Low bargaining power of suppliers
– Suppliers of Qingdao TGOOD Electric in the Technology sector have low bargaining power. Qingdao TGOOD Electric has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Qingdao TGOOD Electric to manage not only supply disruptions but also source products at highly competitive prices.
Innovation driven organization
– Qingdao TGOOD Electric is one of the most innovative firm in Electronic Instr. & Controls sector.
Training and development
– Qingdao TGOOD Electric has one of the best training and development program in Technology 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.
Weaknesses of Qingdao TGOOD Electric | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Qingdao TGOOD Electric are -
Employees’ less understanding of Qingdao TGOOD Electric strategy
– From the outside it seems that the employees of Qingdao TGOOD Electric 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.
Increasing silos among functional specialists
– The organizational structure of Qingdao TGOOD Electric is dominated by functional specialists. It is not different from other players in the Electronic Instr. & Controls industry, but Qingdao TGOOD Electric needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Qingdao TGOOD Electric to focus more on services in the Electronic Instr. & Controls industry rather than just following the product oriented approach.
No frontier risks strategy
– From the 10K / annual statement of Qingdao TGOOD Electric, it seems that company is thinking out the frontier risks that can impact Electronic Instr. & Controls 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.
Capital Spending Reduction
– Even during the low interest decade, Qingdao TGOOD Electric 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 Electronic Instr. & Controls industry using digital technology.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Qingdao TGOOD Electric is slow explore the new channels of communication. These new channels of communication can help Qingdao TGOOD Electric to provide better information regarding Electronic Instr. & Controls products and services. It can also build an online community to further reach out to potential customers.
Workers concerns about automation
– As automation is fast increasing in the Electronic Instr. & Controls industry, Qingdao TGOOD Electric needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Products dominated business model
– Even though Qingdao TGOOD Electric has some of the most successful models in the Electronic Instr. & Controls industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Qingdao TGOOD Electric should strive to include more intangible value offerings along with its core products and services.
Aligning sales with marketing
– From the outside it seems that Qingdao TGOOD Electric needs to have more collaboration between its sales team and marketing team. Sales professionals in the Electronic Instr. & Controls industry have deep experience in developing customer relationships. Marketing department at Qingdao TGOOD Electric can leverage the sales team experience to cultivate customer relationships as Qingdao TGOOD Electric is planning to shift buying processes online.
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 Qingdao TGOOD Electric supply chain. Even after few cautionary changes, Qingdao TGOOD Electric is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Qingdao TGOOD Electric vulnerable to further global disruptions in South East Asia.
Interest costs
– Compare to the competition, Qingdao TGOOD Electric has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Low market penetration in new markets
– Outside its home market of China, Qingdao TGOOD Electric needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Qingdao TGOOD Electric Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Qingdao TGOOD Electric are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Qingdao TGOOD Electric in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Electronic Instr. & Controls industry, and it will provide faster access to the consumers.
Creating value in data economy
– The success of analytics program of Qingdao TGOOD Electric has opened avenues for new revenue streams for the organization in Electronic Instr. & Controls industry. This can help Qingdao TGOOD Electric to build a more holistic ecosystem for Qingdao TGOOD Electric products in the Electronic Instr. & Controls industry by providing – data insight services, data privacy related products, data based consulting services, etc.
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. Qingdao TGOOD Electric can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Building a culture of innovation
– managers at Qingdao TGOOD Electric 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 Electronic Instr. & Controls industry.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Qingdao TGOOD Electric 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 Qingdao TGOOD Electric to hire the very best people irrespective of their geographical location.
Developing new processes and practices
– Qingdao TGOOD Electric can develop new processes and procedures in Electronic Instr. & Controls 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Qingdao TGOOD Electric 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 Qingdao TGOOD Electric to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Qingdao TGOOD Electric is facing challenges because of the dominance of functional experts in the organization. Qingdao TGOOD Electric can utilize new technology in the field of Electronic Instr. & Controls industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Learning at scale
– Online learning technologies has now opened space for Qingdao TGOOD Electric 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.
Loyalty marketing
– Qingdao TGOOD Electric has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Qingdao TGOOD Electric can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Qingdao TGOOD Electric can use these opportunities to build new business models that can help the communities that Qingdao TGOOD Electric operates in. Secondly it can use opportunities from government spending in Electronic Instr. & Controls sector.
Better consumer reach
– The expansion of the 5G network will help Qingdao TGOOD Electric to increase its market reach. Qingdao TGOOD Electric 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.
Threats Qingdao TGOOD Electric External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Qingdao TGOOD Electric are -
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. Qingdao TGOOD Electric 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, Qingdao TGOOD Electric may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Electronic Instr. & Controls sector.
Consumer confidence and its impact on Qingdao TGOOD Electric 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 Electronic Instr. & Controls industry and other sectors.
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 Qingdao TGOOD Electric 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 Qingdao TGOOD Electric.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Qingdao TGOOD Electric in Electronic Instr. & Controls industry. The Electronic Instr. & Controls 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.
Shortening product life cycle
– it is one of the major threat that Qingdao TGOOD Electric is facing in Electronic Instr. & Controls sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Regulatory challenges
– Qingdao TGOOD Electric 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 Electronic Instr. & Controls industry regulations.
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 Qingdao TGOOD Electric in the Electronic Instr. & Controls sector and impact the bottomline of the organization.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Electronic Instr. & Controls industry are lowering. It can presents Qingdao TGOOD Electric with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Electronic Instr. & Controls sector.
High dependence on third party suppliers
– Qingdao TGOOD Electric 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, Qingdao TGOOD Electric 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 Qingdao TGOOD Electric prominent markets.
Weighted SWOT Analysis of Qingdao TGOOD Electric Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Qingdao TGOOD Electric 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 Qingdao TGOOD Electric 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 Qingdao TGOOD Electric 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 Qingdao TGOOD Electric 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 Qingdao TGOOD Electric needs to make to build a sustainable competitive advantage.