SWOT Analysis / TOWS Matrix for Guangzhou Kingmed Diagnostics (China)
Based on various researches at Oak Spring University , Guangzhou Kingmed Diagnostics is operating in a macro-environment that has been destablized by – competitive advantages are harder to sustain because of technology dispersion, challanges to central banks by blockchain based private currencies, supply chains are disrupted by pandemic , increasing inequality as vast percentage of new income is going to the top 1%, increasing household debt because of falling income levels, cloud computing is disrupting traditional business models, increasing government debt because of Covid-19 spendings,
customer relationship management is fast transforming because of increasing concerns over data privacy, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of Guangzhou Kingmed Diagnostics
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Guangzhou Kingmed Diagnostics can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Guangzhou Kingmed Diagnostics, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Guangzhou Kingmed Diagnostics 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 Guangzhou Kingmed Diagnostics can be done for the following purposes –
1. Strategic planning of Guangzhou Kingmed Diagnostics
2. Improving business portfolio management of Guangzhou Kingmed Diagnostics
3. Assessing feasibility of the new initiative in China
4. Making a Business Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Guangzhou Kingmed Diagnostics
Strengths of Guangzhou Kingmed Diagnostics | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Guangzhou Kingmed Diagnostics are -
Diverse revenue streams
– Guangzhou Kingmed Diagnostics is present in almost all the verticals within the Business Services industry. This has provided Guangzhou Kingmed Diagnostics 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.
Organizational Resilience of Guangzhou Kingmed Diagnostics
– The covid-19 pandemic has put organizational resilience at the centre of everthing Guangzhou Kingmed Diagnostics does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High brand equity
– Guangzhou Kingmed Diagnostics has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Guangzhou Kingmed Diagnostics to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to lead change in Business Services
– Guangzhou Kingmed Diagnostics is one of the leading players in the Business Services industry in China. Over the years it has not only transformed the business landscape in the Business Services industry in China but also across the existing markets. The ability to lead change has enabled Guangzhou Kingmed Diagnostics in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High switching costs
– The high switching costs that Guangzhou Kingmed Diagnostics 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.
Innovation driven organization
– Guangzhou Kingmed Diagnostics is one of the most innovative firm in Business Services sector.
Strong track record of project management in the Business Services industry
– Guangzhou Kingmed Diagnostics 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)
– Guangzhou Kingmed Diagnostics has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Guangzhou Kingmed Diagnostics staying ahead in the Business Services industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to recruit top talent
– Guangzhou Kingmed Diagnostics is one of the leading players in the Business Services 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.
Sustainable margins compare to other players in Business Services industry
– Guangzhou Kingmed Diagnostics has clearly differentiated products in the market place. This has enabled Guangzhou Kingmed Diagnostics to fetch slight price premium compare to the competitors in the Business Services industry. The sustainable margins have also helped Guangzhou Kingmed Diagnostics to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Guangzhou Kingmed Diagnostics 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.
Learning organization
- Guangzhou Kingmed Diagnostics 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 Guangzhou Kingmed Diagnostics is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Guangzhou Kingmed Diagnostics emphasize – knowledge, initiative, and innovation.
Weaknesses of Guangzhou Kingmed Diagnostics | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Guangzhou Kingmed Diagnostics are -
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 Guangzhou Kingmed Diagnostics supply chain. Even after few cautionary changes, Guangzhou Kingmed Diagnostics is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Guangzhou Kingmed Diagnostics vulnerable to further global disruptions in South East Asia.
Ability to respond to the competition
– As the decision making is very deliberative at Guangzhou Kingmed Diagnostics, in the dynamic environment of Business Services industry it has struggled to respond to the nimble upstart competition. Guangzhou Kingmed Diagnostics has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Guangzhou Kingmed Diagnostics is slow explore the new channels of communication. These new channels of communication can help Guangzhou Kingmed Diagnostics to provide better information regarding Business Services products and services. It can also build an online community to further reach out to potential customers.
Interest costs
– Compare to the competition, Guangzhou Kingmed Diagnostics 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.
Aligning sales with marketing
– From the outside it seems that Guangzhou Kingmed Diagnostics needs to have more collaboration between its sales team and marketing team. Sales professionals in the Business Services industry have deep experience in developing customer relationships. Marketing department at Guangzhou Kingmed Diagnostics can leverage the sales team experience to cultivate customer relationships as Guangzhou Kingmed Diagnostics is planning to shift buying processes online.
Need for greater diversity
– Guangzhou Kingmed Diagnostics 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.
Workers concerns about automation
– As automation is fast increasing in the Business Services industry, Guangzhou Kingmed Diagnostics 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.
High dependence on Guangzhou Kingmed Diagnostics ‘s star products
– The top 2 products and services of Guangzhou Kingmed Diagnostics still accounts for major business revenue. This dependence on star products in Business Services industry has resulted into insufficient focus on developing new products, even though Guangzhou Kingmed Diagnostics has relatively successful track record of launching new products.
Compensation and incentives
– The revenue per employee of Guangzhou Kingmed Diagnostics is just above the Business Services 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.
Capital Spending Reduction
– Even during the low interest decade, Guangzhou Kingmed Diagnostics 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 Business Services industry using digital technology.
No frontier risks strategy
– From the 10K / annual statement of Guangzhou Kingmed Diagnostics, it seems that company is thinking out the frontier risks that can impact Business Services 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.
Guangzhou Kingmed Diagnostics Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Guangzhou Kingmed Diagnostics are -
Low interest rates
– Even though inflation is raising its head in most developed economies, Guangzhou Kingmed Diagnostics 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.
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 Guangzhou Kingmed Diagnostics 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Business Services industry, but it has also influenced the consumer preferences. Guangzhou Kingmed Diagnostics 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, Guangzhou Kingmed Diagnostics is facing challenges because of the dominance of functional experts in the organization. Guangzhou Kingmed Diagnostics can utilize new technology in the field of Business Services industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Developing new processes and practices
– Guangzhou Kingmed Diagnostics can develop new processes and procedures in Business Services 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
– Guangzhou Kingmed Diagnostics 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
– Guangzhou Kingmed Diagnostics 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.
Manufacturing automation
– Guangzhou Kingmed Diagnostics can use the latest technology developments to improve its manufacturing and designing process in Business Services 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Business Services industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Guangzhou Kingmed Diagnostics 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. Guangzhou Kingmed Diagnostics 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Guangzhou Kingmed Diagnostics can use these opportunities to build new business models that can help the communities that Guangzhou Kingmed Diagnostics operates in. Secondly it can use opportunities from government spending in Business Services sector.
Using analytics as competitive advantage
– Guangzhou Kingmed Diagnostics has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Business Services sector. This continuous investment in analytics has enabled Guangzhou Kingmed Diagnostics to build a competitive advantage using analytics. The analytics driven competitive advantage can help Guangzhou Kingmed Diagnostics to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Guangzhou Kingmed Diagnostics can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Use of Bitcoin and other crypto currencies for transactions in Business Services industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Guangzhou Kingmed Diagnostics in the Business Services industry. Now Guangzhou Kingmed Diagnostics can target international markets with far fewer capital restrictions requirements than the existing system.
Threats Guangzhou Kingmed Diagnostics External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Guangzhou Kingmed Diagnostics are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Business Services industry are lowering. It can presents Guangzhou Kingmed Diagnostics with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Business Services sector.
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.
Stagnating economy with rate increase
– Guangzhou Kingmed Diagnostics 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 Business Services industry.
Technology acceleration in Forth Industrial Revolution
– Guangzhou Kingmed Diagnostics has witnessed rapid integration of technology during Covid-19 in the Business Services industry. As one of the leading players in the industry, Guangzhou Kingmed Diagnostics needs to keep up with the evolution of technology in the Business Services 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Guangzhou Kingmed Diagnostics may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Business Services sector.
Easy access to finance
– Easy access to finance in Business Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Guangzhou Kingmed Diagnostics can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Guangzhou Kingmed Diagnostics.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Guangzhou Kingmed Diagnostics in Business Services industry. The Business Services 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, Guangzhou Kingmed Diagnostics 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 Guangzhou Kingmed Diagnostics prominent markets.
Environmental challenges
– Guangzhou Kingmed Diagnostics 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. Guangzhou Kingmed Diagnostics can take advantage of this fund but it will also bring new competitors in the Business Services industry.
Regulatory challenges
– Guangzhou Kingmed Diagnostics 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 Business Services 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. Guangzhou Kingmed Diagnostics 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.
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 Guangzhou Kingmed Diagnostics in the Business Services sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Guangzhou Kingmed Diagnostics Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Guangzhou Kingmed Diagnostics 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 Guangzhou Kingmed Diagnostics 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 Guangzhou Kingmed Diagnostics 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 Guangzhou Kingmed Diagnostics 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 Guangzhou Kingmed Diagnostics needs to make to build a sustainable competitive advantage.
