Wuxi Taiji Industry (600667) SWOT Analysis / TOWS Matrix / MBA Resources
Semiconductors
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Wuxi Taiji Industry (China)
Based on various researches at Oak Spring University , Wuxi Taiji Industry is operating in a macro-environment that has been destablized by – digital marketing is dominated by two big players Facebook and Google, increasing inequality as vast percentage of new income is going to the top 1%, talent flight as more people leaving formal jobs, there is backlash against globalization, increasing household debt because of falling income levels, increasing energy prices, supply chains are disrupted by pandemic ,
increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of Wuxi Taiji Industry
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Wuxi Taiji Industry can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Wuxi Taiji Industry, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Wuxi Taiji Industry 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 Wuxi Taiji Industry can be done for the following purposes –
1. Strategic planning of Wuxi Taiji Industry
2. Improving business portfolio management of Wuxi Taiji Industry
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 Wuxi Taiji Industry
Strengths of Wuxi Taiji Industry | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Wuxi Taiji Industry are -
Organizational Resilience of Wuxi Taiji Industry
– The covid-19 pandemic has put organizational resilience at the centre of everthing Wuxi Taiji Industry does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Digital Transformation in Semiconductors industry
- digital transformation varies from industry to industry. For Wuxi Taiji Industry digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Wuxi Taiji Industry 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.
Superior customer experience
– The customer experience strategy of Wuxi Taiji Industry in Semiconductors industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the Wuxi Taiji Industry 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
– Wuxi Taiji Industry is one of the most innovative firm in Semiconductors sector.
Operational resilience
– The operational resilience strategy of Wuxi Taiji Industry 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.
Low bargaining power of suppliers
– Suppliers of Wuxi Taiji Industry in the Technology sector have low bargaining power. Wuxi Taiji Industry has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Wuxi Taiji Industry to manage not only supply disruptions but also source products at highly competitive prices.
Effective Research and Development (R&D)
– Wuxi Taiji Industry has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Wuxi Taiji Industry 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.
Highly skilled collaborators
– Wuxi Taiji Industry has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Semiconductors industry. Secondly the value chain collaborators of Wuxi Taiji Industry have helped the firm to develop new products and bring them quickly to the marketplace.
Analytics focus
– Wuxi Taiji Industry 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 Semiconductors 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.
Learning organization
- Wuxi Taiji Industry 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 Wuxi Taiji Industry is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Wuxi Taiji Industry emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in Semiconductors industry
– Wuxi Taiji Industry has clearly differentiated products in the market place. This has enabled Wuxi Taiji Industry to fetch slight price premium compare to the competitors in the Semiconductors industry. The sustainable margins have also helped Wuxi Taiji Industry to invest into research and development (R&D) and innovation.
Weaknesses of Wuxi Taiji Industry | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Wuxi Taiji Industry are -
Capital Spending Reduction
– Even during the low interest decade, Wuxi Taiji Industry 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 Semiconductors 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, Wuxi Taiji Industry is slow explore the new channels of communication. These new channels of communication can help Wuxi Taiji Industry to provide better information regarding Semiconductors products and services. It can also build an online community to further reach out to potential customers.
Products dominated business model
– Even though Wuxi Taiji Industry has some of the most successful models in the Semiconductors industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Wuxi Taiji Industry should strive to include more intangible value offerings along with its core products and services.
High bargaining power of channel partners in Semiconductors industry
– because of the regulatory requirements in China, Wuxi Taiji Industry 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.
Need for greater diversity
– Wuxi Taiji Industry 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.
Employees’ less understanding of Wuxi Taiji Industry strategy
– From the outside it seems that the employees of Wuxi Taiji Industry 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.
Aligning sales with marketing
– From the outside it seems that Wuxi Taiji Industry needs to have more collaboration between its sales team and marketing team. Sales professionals in the Semiconductors industry have deep experience in developing customer relationships. Marketing department at Wuxi Taiji Industry can leverage the sales team experience to cultivate customer relationships as Wuxi Taiji Industry is planning to shift buying processes online.
Lack of clear differentiation of Wuxi Taiji Industry products
– To increase the profitability and margins on the products, Wuxi Taiji Industry needs to provide more differentiated products than what it is currently offering in the marketplace.
Increasing silos among functional specialists
– The organizational structure of Wuxi Taiji Industry is dominated by functional specialists. It is not different from other players in the Semiconductors industry, but Wuxi Taiji Industry needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Wuxi Taiji Industry to focus more on services in the Semiconductors industry rather than just following the product oriented approach.
High cash cycle compare to competitors
Wuxi Taiji Industry 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.
No frontier risks strategy
– From the 10K / annual statement of Wuxi Taiji Industry, it seems that company is thinking out the frontier risks that can impact Semiconductors 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.
Wuxi Taiji Industry Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Wuxi Taiji Industry are -
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 Wuxi Taiji Industry 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Wuxi Taiji Industry 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 Wuxi Taiji Industry 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. Wuxi Taiji Industry can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Buying journey improvements
– Wuxi Taiji Industry can improve the customer journey of consumers in the Semiconductors 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
– Wuxi Taiji Industry has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Semiconductors sector. This continuous investment in analytics has enabled Wuxi Taiji Industry to build a competitive advantage using analytics. The analytics driven competitive advantage can help Wuxi Taiji Industry to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Manufacturing automation
– Wuxi Taiji Industry 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Semiconductors industry, but it has also influenced the consumer preferences. Wuxi Taiji Industry can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Wuxi Taiji Industry is facing challenges because of the dominance of functional experts in the organization. Wuxi Taiji Industry 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.
Building a culture of innovation
– managers at Wuxi Taiji Industry 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Wuxi Taiji Industry 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 Wuxi Taiji Industry to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Developing new processes and practices
– Wuxi Taiji Industry 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.
Creating value in data economy
– The success of analytics program of Wuxi Taiji Industry has opened avenues for new revenue streams for the organization in Semiconductors industry. This can help Wuxi Taiji Industry to build a more holistic ecosystem for Wuxi Taiji Industry products in the Semiconductors industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Loyalty marketing
– Wuxi Taiji Industry 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.
Threats Wuxi Taiji Industry External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Wuxi Taiji Industry are -
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 Wuxi Taiji Industry business can come under increasing regulations regarding data privacy, data security, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Wuxi Taiji Industry 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.
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 Wuxi Taiji Industry in the Semiconductors sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– Wuxi Taiji Industry has witnessed rapid integration of technology during Covid-19 in the Semiconductors industry. As one of the leading players in the industry, Wuxi Taiji Industry needs to keep up with the evolution of technology in the Semiconductors 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.
Increasing wage structure of Wuxi Taiji Industry
– 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 Wuxi Taiji Industry.
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 Wuxi Taiji Industry.
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. Wuxi Taiji Industry 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, Wuxi Taiji Industry 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.
Consumer confidence and its impact on Wuxi Taiji Industry 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.
High dependence on third party suppliers
– Wuxi Taiji Industry 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.
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 Semiconductors industry are lowering. It can presents Wuxi Taiji Industry with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Semiconductors sector.
Regulatory challenges
– Wuxi Taiji Industry 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 Semiconductors industry regulations.
Weighted SWOT Analysis of Wuxi Taiji Industry Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Wuxi Taiji Industry 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 Wuxi Taiji Industry 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 Wuxi Taiji Industry 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 Wuxi Taiji Industry 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 Wuxi Taiji Industry needs to make to build a sustainable competitive advantage.