Huolinhe Coal A (2128) SWOT Analysis / TOWS Matrix / MBA Resources
Coal
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Huolinhe Coal A (China)
Based on various researches at Oak Spring University , Huolinhe Coal A is operating in a macro-environment that has been destablized by – challanges to central banks by blockchain based private currencies, supply chains are disrupted by pandemic , cloud computing is disrupting traditional business models, wage bills are increasing, increasing government debt because of Covid-19 spendings, geopolitical disruptions, increasing commodity prices,
banking and financial system is disrupted by Bitcoin and other crypto currencies, technology disruption, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Huolinhe Coal A can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Huolinhe Coal A, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Huolinhe Coal A 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 Huolinhe Coal A can be done for the following purposes –
1. Strategic planning of Huolinhe Coal A
2. Improving business portfolio management of Huolinhe Coal A
3. Assessing feasibility of the new initiative in China
4. Making a Coal sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Huolinhe Coal A
Strengths of Huolinhe Coal A | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Huolinhe Coal A are -
Operational resilience
– The operational resilience strategy of Huolinhe Coal A comprises – understanding the underlying the factors in the Coal 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 switching costs
– The high switching costs that Huolinhe Coal A 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.
High brand equity
– Huolinhe Coal A has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Huolinhe Coal A to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in Coal industry
– Huolinhe Coal A has clearly differentiated products in the market place. This has enabled Huolinhe Coal A to fetch slight price premium compare to the competitors in the Coal industry. The sustainable margins have also helped Huolinhe Coal A to invest into research and development (R&D) and innovation.
Effective Research and Development (R&D)
– Huolinhe Coal A has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Huolinhe Coal A staying ahead in the Coal industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Cross disciplinary teams
– Horizontal connected teams at the Huolinhe Coal A 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.
Organizational Resilience of Huolinhe Coal A
– The covid-19 pandemic has put organizational resilience at the centre of everthing Huolinhe Coal A does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Highly skilled collaborators
– Huolinhe Coal A has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Coal industry. Secondly the value chain collaborators of Huolinhe Coal A have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– Huolinhe Coal A has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Huolinhe Coal A 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.
Digital Transformation in Coal industry
- digital transformation varies from industry to industry. For Huolinhe Coal A digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Huolinhe Coal A 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.
Low bargaining power of suppliers
– Suppliers of Huolinhe Coal A in the Energy sector have low bargaining power. Huolinhe Coal A has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Huolinhe Coal A to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Huolinhe Coal A in Coal industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses of Huolinhe Coal A | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Huolinhe Coal A are -
High operating costs
– Compare to the competitors, Huolinhe Coal A has high operating costs in the Coal industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Huolinhe Coal A lucrative customers.
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 Huolinhe Coal A supply chain. Even after few cautionary changes, Huolinhe Coal A is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Huolinhe Coal A vulnerable to further global disruptions in South East Asia.
High bargaining power of channel partners in Coal industry
– because of the regulatory requirements in China, Huolinhe Coal A 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 Coal industry.
Slow decision making process
– As mentioned earlier in the report, Huolinhe Coal A has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Coal industry over the last five years. Huolinhe Coal A 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.
Workers concerns about automation
– As automation is fast increasing in the Coal industry, Huolinhe Coal A 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.
Skills based hiring in Coal industry
– The stress on hiring functional specialists at Huolinhe Coal A 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.
Employees’ less understanding of Huolinhe Coal A strategy
– From the outside it seems that the employees of Huolinhe Coal A 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.
Lack of clear differentiation of Huolinhe Coal A products
– To increase the profitability and margins on the products, Huolinhe Coal A needs to provide more differentiated products than what it is currently offering in the marketplace.
Increasing silos among functional specialists
– The organizational structure of Huolinhe Coal A is dominated by functional specialists. It is not different from other players in the Coal industry, but Huolinhe Coal A needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Huolinhe Coal A to focus more on services in the Coal industry rather than just following the product oriented approach.
Need for greater diversity
– Huolinhe Coal A 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.
Interest costs
– Compare to the competition, Huolinhe Coal A 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.
Huolinhe Coal A Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Huolinhe Coal A are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Huolinhe Coal A in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Coal industry, and it will provide faster access to the consumers.
Buying journey improvements
– Huolinhe Coal A can improve the customer journey of consumers in the Coal 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.
Using analytics as competitive advantage
– Huolinhe Coal A has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Coal sector. This continuous investment in analytics has enabled Huolinhe Coal A to build a competitive advantage using analytics. The analytics driven competitive advantage can help Huolinhe Coal A to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Huolinhe Coal A 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 Huolinhe Coal A to hire the very best people irrespective of their geographical location.
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. Huolinhe Coal A can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Creating value in data economy
– The success of analytics program of Huolinhe Coal A has opened avenues for new revenue streams for the organization in Coal industry. This can help Huolinhe Coal A to build a more holistic ecosystem for Huolinhe Coal A products in the Coal industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Developing new processes and practices
– Huolinhe Coal A can develop new processes and procedures in Coal 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Huolinhe Coal A is facing challenges because of the dominance of functional experts in the organization. Huolinhe Coal A can utilize new technology in the field of Coal industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Low interest rates
– Even though inflation is raising its head in most developed economies, Huolinhe Coal A can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Loyalty marketing
– Huolinhe Coal A 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.
Use of Bitcoin and other crypto currencies for transactions in Coal industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Huolinhe Coal A in the Coal industry. Now Huolinhe Coal A can target international markets with far fewer capital restrictions requirements than the existing system.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Huolinhe Coal A can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Huolinhe Coal A 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 Huolinhe Coal A 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 Huolinhe Coal A External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Huolinhe Coal A are -
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
– Huolinhe Coal A 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 Coal industry regulations.
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. Huolinhe Coal A 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.
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 Huolinhe Coal A.
High dependence on third party suppliers
– Huolinhe Coal A 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.
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 Huolinhe Coal A in the Coal sector and impact the bottomline of the organization.
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 Huolinhe Coal A business can come under increasing regulations regarding data privacy, data security, etc.
Technology acceleration in Forth Industrial Revolution
– Huolinhe Coal A has witnessed rapid integration of technology during Covid-19 in the Coal industry. As one of the leading players in the industry, Huolinhe Coal A needs to keep up with the evolution of technology in the Coal 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.
Consumer confidence and its impact on Huolinhe Coal A 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 Coal industry and other sectors.
Increasing wage structure of Huolinhe Coal A
– 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 Huolinhe Coal A.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Huolinhe Coal A may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Coal sector.
Shortening product life cycle
– it is one of the major threat that Huolinhe Coal A is facing in Coal sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Environmental challenges
– Huolinhe Coal A 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. Huolinhe Coal A can take advantage of this fund but it will also bring new competitors in the Coal industry.
Weighted SWOT Analysis of Huolinhe Coal A Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Huolinhe Coal A 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 Huolinhe Coal A 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 Huolinhe Coal A 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 Huolinhe Coal A 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 Huolinhe Coal A needs to make to build a sustainable competitive advantage.