SWOT Analysis / TOWS Matrix for Jiangsu Changjiang Electronics (China)
Based on various researches at Oak Spring University , Jiangsu Changjiang Electronics is operating in a macro-environment that has been destablized by – talent flight as more people leaving formal jobs, increasing inequality as vast percentage of new income is going to the top 1%, competitive advantages are harder to sustain because of technology dispersion, supply chains are disrupted by pandemic , central banks are concerned over increasing inflation, increasing transportation and logistics costs, there is increasing trade war between United States & China,
geopolitical disruptions, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of Jiangsu Changjiang Electronics
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Jiangsu Changjiang Electronics can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Jiangsu Changjiang Electronics, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Jiangsu Changjiang Electronics 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 Jiangsu Changjiang Electronics can be done for the following purposes –
1. Strategic planning of Jiangsu Changjiang Electronics
2. Improving business portfolio management of Jiangsu Changjiang Electronics
3. Assessing feasibility of the new initiative in China
4. Making a Semiconductors sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Jiangsu Changjiang Electronics
Strengths of Jiangsu Changjiang Electronics | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Jiangsu Changjiang Electronics are -
Sustainable margins compare to other players in Semiconductors industry
– Jiangsu Changjiang Electronics has clearly differentiated products in the market place. This has enabled Jiangsu Changjiang Electronics to fetch slight price premium compare to the competitors in the Semiconductors industry. The sustainable margins have also helped Jiangsu Changjiang Electronics to invest into research and development (R&D) and innovation.
Operational resilience
– The operational resilience strategy of Jiangsu Changjiang Electronics comprises – understanding the underlying the factors in the Semiconductors 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.
Digital Transformation in Semiconductors industry
- digital transformation varies from industry to industry. For Jiangsu Changjiang Electronics digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Jiangsu Changjiang Electronics 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.
Diverse revenue streams
– Jiangsu Changjiang Electronics is present in almost all the verticals within the Semiconductors industry. This has provided Jiangsu Changjiang Electronics 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.
Low bargaining power of suppliers
– Suppliers of Jiangsu Changjiang Electronics in the Technology sector have low bargaining power. Jiangsu Changjiang Electronics has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Jiangsu Changjiang Electronics to manage not only supply disruptions but also source products at highly competitive prices.
Ability to lead change in Semiconductors
– Jiangsu Changjiang Electronics is one of the leading players in the Semiconductors industry in China. Over the years it has not only transformed the business landscape in the Semiconductors industry in China but also across the existing markets. The ability to lead change has enabled Jiangsu Changjiang Electronics in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Learning organization
- Jiangsu Changjiang Electronics 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 Jiangsu Changjiang Electronics is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Jiangsu Changjiang Electronics emphasize – knowledge, initiative, and innovation.
Superior customer experience
– The customer experience strategy of Jiangsu Changjiang Electronics in Semiconductors industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to recruit top talent
– Jiangsu Changjiang Electronics is one of the leading players in the Semiconductors industry in China. It is in a position to attract the best talent available in China. The firm has a robust talent identification program that helps in identifying the brightest.
Strong track record of project management in the Semiconductors industry
– Jiangsu Changjiang Electronics is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Effective Research and Development (R&D)
– Jiangsu Changjiang Electronics has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Jiangsu Changjiang Electronics staying ahead in the Semiconductors industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High switching costs
– The high switching costs that Jiangsu Changjiang Electronics 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.
Weaknesses of Jiangsu Changjiang Electronics | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Jiangsu Changjiang Electronics are -
High cash cycle compare to competitors
Jiangsu Changjiang Electronics has a high cash cycle compare to other players in the Semiconductors industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Ability to respond to the competition
– As the decision making is very deliberative at Jiangsu Changjiang Electronics, in the dynamic environment of Semiconductors industry it has struggled to respond to the nimble upstart competition. Jiangsu Changjiang Electronics has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
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 Jiangsu Changjiang Electronics supply chain. Even after few cautionary changes, Jiangsu Changjiang Electronics is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Jiangsu Changjiang Electronics vulnerable to further global disruptions in South East Asia.
Lack of clear differentiation of Jiangsu Changjiang Electronics products
– To increase the profitability and margins on the products, Jiangsu Changjiang Electronics needs to provide more differentiated products than what it is currently offering in the marketplace.
Compensation and incentives
– The revenue per employee of Jiangsu Changjiang Electronics is just above the Semiconductors 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 bargaining power of channel partners in Semiconductors industry
– because of the regulatory requirements in China, Jiangsu Changjiang Electronics 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 Semiconductors industry.
Employees’ less understanding of Jiangsu Changjiang Electronics strategy
– From the outside it seems that the employees of Jiangsu Changjiang Electronics 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.
Workers concerns about automation
– As automation is fast increasing in the Semiconductors industry, Jiangsu Changjiang Electronics 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.
Interest costs
– Compare to the competition, Jiangsu Changjiang Electronics 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.
High dependence on Jiangsu Changjiang Electronics ‘s star products
– The top 2 products and services of Jiangsu Changjiang Electronics still accounts for major business revenue. This dependence on star products in Semiconductors industry has resulted into insufficient focus on developing new products, even though Jiangsu Changjiang Electronics has relatively successful track record of launching new products.
Slow to strategic competitive environment developments
– As Jiangsu Changjiang Electronics is one of the leading players in the Semiconductors industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Semiconductors industry in last five years.
Jiangsu Changjiang Electronics Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Jiangsu Changjiang Electronics are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Jiangsu Changjiang Electronics 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 Jiangsu Changjiang Electronics to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Better consumer reach
– The expansion of the 5G network will help Jiangsu Changjiang Electronics to increase its market reach. Jiangsu Changjiang Electronics 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 Jiangsu Changjiang Electronics 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Jiangsu Changjiang Electronics can use these opportunities to build new business models that can help the communities that Jiangsu Changjiang Electronics operates in. Secondly it can use opportunities from government spending in Semiconductors sector.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Jiangsu Changjiang Electronics is facing challenges because of the dominance of functional experts in the organization. Jiangsu Changjiang Electronics can utilize new technology in the field of Semiconductors industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Jiangsu Changjiang Electronics can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Manufacturing automation
– Jiangsu Changjiang Electronics can use the latest technology developments to improve its manufacturing and designing process in Semiconductors 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.
Creating value in data economy
– The success of analytics program of Jiangsu Changjiang Electronics has opened avenues for new revenue streams for the organization in Semiconductors industry. This can help Jiangsu Changjiang Electronics to build a more holistic ecosystem for Jiangsu Changjiang Electronics products in the Semiconductors 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. Jiangsu Changjiang Electronics can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Jiangsu Changjiang Electronics 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 Jiangsu Changjiang Electronics to hire the very best people irrespective of their geographical location.
Developing new processes and practices
– Jiangsu Changjiang Electronics can develop new processes and procedures in Semiconductors 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.
Loyalty marketing
– Jiangsu Changjiang Electronics 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.
Building a culture of innovation
– managers at Jiangsu Changjiang Electronics 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 Semiconductors industry.
Threats Jiangsu Changjiang Electronics External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Jiangsu Changjiang Electronics are -
Consumer confidence and its impact on Jiangsu Changjiang Electronics 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 Semiconductors industry and other sectors.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Jiangsu Changjiang Electronics may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Semiconductors sector.
Easy access to finance
– Easy access to finance in Semiconductors industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Jiangsu Changjiang Electronics can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Stagnating economy with rate increase
– Jiangsu Changjiang Electronics 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 Semiconductors industry.
Increasing wage structure of Jiangsu Changjiang Electronics
– 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 Jiangsu Changjiang Electronics.
Environmental challenges
– Jiangsu Changjiang Electronics 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. Jiangsu Changjiang Electronics can take advantage of this fund but it will also bring new competitors in the Semiconductors industry.
High dependence on third party suppliers
– Jiangsu Changjiang Electronics 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Jiangsu Changjiang Electronics in Semiconductors industry. The Semiconductors 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Jiangsu Changjiang Electronics 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 Jiangsu Changjiang Electronics prominent markets.
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 Jiangsu Changjiang Electronics in the Semiconductors sector and impact the bottomline of the organization.
Shortening product life cycle
– it is one of the major threat that Jiangsu Changjiang Electronics is facing in Semiconductors sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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.
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 Jiangsu Changjiang Electronics business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of Jiangsu Changjiang Electronics Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Jiangsu Changjiang Electronics 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 Jiangsu Changjiang Electronics 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 Jiangsu Changjiang Electronics 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 Jiangsu Changjiang Electronics 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 Jiangsu Changjiang Electronics needs to make to build a sustainable competitive advantage.
