Guangdong Hongteo Accurate Tech (300176) SWOT Analysis / TOWS Matrix / MBA Resources
Misc. Fabricated Products
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Guangdong Hongteo Accurate Tech (China)
Based on various researches at Oak Spring University , Guangdong Hongteo Accurate Tech is operating in a macro-environment that has been destablized by – increasing transportation and logistics costs, increasing commodity prices, there is increasing trade war between United States & China, there is backlash against globalization, customer relationship management is fast transforming because of increasing concerns over data privacy, talent flight as more people leaving formal jobs, supply chains are disrupted by pandemic ,
technology disruption, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Guangdong Hongteo Accurate Tech
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Guangdong Hongteo Accurate Tech can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Guangdong Hongteo Accurate Tech, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Guangdong Hongteo Accurate Tech 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 Guangdong Hongteo Accurate Tech can be done for the following purposes –
1. Strategic planning of Guangdong Hongteo Accurate Tech
2. Improving business portfolio management of Guangdong Hongteo Accurate Tech
3. Assessing feasibility of the new initiative in China
4. Making a Misc. Fabricated Products sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Guangdong Hongteo Accurate Tech
Strengths of Guangdong Hongteo Accurate Tech | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Guangdong Hongteo Accurate Tech are -
Diverse revenue streams
– Guangdong Hongteo Accurate Tech is present in almost all the verticals within the Misc. Fabricated Products industry. This has provided Guangdong Hongteo Accurate Tech 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 Guangdong Hongteo Accurate Tech 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.
Innovation driven organization
– Guangdong Hongteo Accurate Tech is one of the most innovative firm in Misc. Fabricated Products sector.
Highly skilled collaborators
– Guangdong Hongteo Accurate Tech has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Misc. Fabricated Products industry. Secondly the value chain collaborators of Guangdong Hongteo Accurate Tech have helped the firm to develop new products and bring them quickly to the marketplace.
Training and development
– Guangdong Hongteo Accurate Tech has one of the best training and development program in Basic Materials 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.
Operational resilience
– The operational resilience strategy of Guangdong Hongteo Accurate Tech comprises – understanding the underlying the factors in the Misc. Fabricated Products 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.
High brand equity
– Guangdong Hongteo Accurate Tech has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Guangdong Hongteo Accurate Tech to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Digital Transformation in Misc. Fabricated Products industry
- digital transformation varies from industry to industry. For Guangdong Hongteo Accurate Tech digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Guangdong Hongteo Accurate Tech 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.
Analytics focus
– Guangdong Hongteo Accurate Tech 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 Misc. Fabricated Products 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 Misc. Fabricated Products
– Guangdong Hongteo Accurate Tech is one of the leading players in the Misc. Fabricated Products industry in China. Over the years it has not only transformed the business landscape in the Misc. Fabricated Products industry in China but also across the existing markets. The ability to lead change has enabled Guangdong Hongteo Accurate Tech in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Organizational Resilience of Guangdong Hongteo Accurate Tech
– The covid-19 pandemic has put organizational resilience at the centre of everthing Guangdong Hongteo Accurate Tech does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High switching costs
– The high switching costs that Guangdong Hongteo Accurate Tech 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 Guangdong Hongteo Accurate Tech | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Guangdong Hongteo Accurate Tech are -
Skills based hiring in Misc. Fabricated Products industry
– The stress on hiring functional specialists at Guangdong Hongteo Accurate Tech 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.
No frontier risks strategy
– From the 10K / annual statement of Guangdong Hongteo Accurate Tech, it seems that company is thinking out the frontier risks that can impact Misc. Fabricated Products 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Guangdong Hongteo Accurate Tech is slow explore the new channels of communication. These new channels of communication can help Guangdong Hongteo Accurate Tech to provide better information regarding Misc. Fabricated Products products and services. It can also build an online community to further reach out to potential customers.
Interest costs
– Compare to the competition, Guangdong Hongteo Accurate Tech 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 cash cycle compare to competitors
Guangdong Hongteo Accurate Tech has a high cash cycle compare to other players in the Misc. Fabricated Products industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Slow decision making process
– As mentioned earlier in the report, Guangdong Hongteo Accurate Tech has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Misc. Fabricated Products industry over the last five years. Guangdong Hongteo Accurate Tech 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.
Lack of clear differentiation of Guangdong Hongteo Accurate Tech products
– To increase the profitability and margins on the products, Guangdong Hongteo Accurate Tech needs to provide more differentiated products than what it is currently offering in the marketplace.
Compensation and incentives
– The revenue per employee of Guangdong Hongteo Accurate Tech is just above the Misc. Fabricated Products 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.
Low market penetration in new markets
– Outside its home market of China, Guangdong Hongteo Accurate Tech needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Increasing silos among functional specialists
– The organizational structure of Guangdong Hongteo Accurate Tech is dominated by functional specialists. It is not different from other players in the Misc. Fabricated Products industry, but Guangdong Hongteo Accurate Tech needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Guangdong Hongteo Accurate Tech to focus more on services in the Misc. Fabricated Products industry rather than just following the product oriented approach.
Workers concerns about automation
– As automation is fast increasing in the Misc. Fabricated Products industry, Guangdong Hongteo Accurate Tech 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.
Guangdong Hongteo Accurate Tech Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Guangdong Hongteo Accurate Tech are -
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Misc. Fabricated Products industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Guangdong Hongteo Accurate Tech 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. Guangdong Hongteo Accurate Tech 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.
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. Guangdong Hongteo Accurate Tech can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Guangdong Hongteo Accurate Tech is facing challenges because of the dominance of functional experts in the organization. Guangdong Hongteo Accurate Tech can utilize new technology in the field of Misc. Fabricated Products industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Better consumer reach
– The expansion of the 5G network will help Guangdong Hongteo Accurate Tech to increase its market reach. Guangdong Hongteo Accurate Tech 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.
Developing new processes and practices
– Guangdong Hongteo Accurate Tech can develop new processes and procedures in Misc. Fabricated Products 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
– Guangdong Hongteo Accurate Tech 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.
Leveraging digital technologies
– Guangdong Hongteo Accurate Tech 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Guangdong Hongteo Accurate Tech in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Misc. Fabricated Products industry, and it will provide faster access to the consumers.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Guangdong Hongteo Accurate Tech 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 Guangdong Hongteo Accurate Tech to hire the very best people irrespective of their geographical location.
Buying journey improvements
– Guangdong Hongteo Accurate Tech can improve the customer journey of consumers in the Misc. Fabricated Products industry by using analytics and artificial intelligence. It can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Creating value in data economy
– The success of analytics program of Guangdong Hongteo Accurate Tech has opened avenues for new revenue streams for the organization in Misc. Fabricated Products industry. This can help Guangdong Hongteo Accurate Tech to build a more holistic ecosystem for Guangdong Hongteo Accurate Tech products in the Misc. Fabricated Products industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at Guangdong Hongteo Accurate Tech 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 Misc. Fabricated Products industry.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Guangdong Hongteo Accurate Tech 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 Guangdong Hongteo Accurate Tech to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Threats Guangdong Hongteo Accurate Tech External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Guangdong Hongteo Accurate Tech are -
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. Guangdong Hongteo Accurate Tech needs to understand the core reasons impacting the Misc. Fabricated Products industry. This will help it in building a better workplace.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Misc. Fabricated Products industry are lowering. It can presents Guangdong Hongteo Accurate Tech with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Misc. Fabricated Products sector.
Stagnating economy with rate increase
– Guangdong Hongteo Accurate Tech 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 Misc. Fabricated Products industry.
Increasing wage structure of Guangdong Hongteo Accurate Tech
– 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 Guangdong Hongteo Accurate Tech.
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. Guangdong Hongteo Accurate Tech 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.
High dependence on third party suppliers
– Guangdong Hongteo Accurate Tech 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 Guangdong Hongteo Accurate Tech in Misc. Fabricated Products industry. The Misc. Fabricated Products 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.
Easy access to finance
– Easy access to finance in Misc. Fabricated Products industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Guangdong Hongteo Accurate Tech can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Technology acceleration in Forth Industrial Revolution
– Guangdong Hongteo Accurate Tech has witnessed rapid integration of technology during Covid-19 in the Misc. Fabricated Products industry. As one of the leading players in the industry, Guangdong Hongteo Accurate Tech needs to keep up with the evolution of technology in the Misc. Fabricated Products 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.
Environmental challenges
– Guangdong Hongteo Accurate Tech 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. Guangdong Hongteo Accurate Tech can take advantage of this fund but it will also bring new competitors in the Misc. Fabricated Products industry.
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.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Guangdong Hongteo Accurate Tech may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Misc. Fabricated Products sector.
Weighted SWOT Analysis of Guangdong Hongteo Accurate Tech Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Guangdong Hongteo Accurate Tech 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 Guangdong Hongteo Accurate Tech 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 Guangdong Hongteo Accurate Tech 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 Guangdong Hongteo Accurate Tech 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 Guangdong Hongteo Accurate Tech needs to make to build a sustainable competitive advantage.