XiAn Shaangu Power (601369) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for XiAn Shaangu Power (China)

Based on various researches at Oak Spring University , XiAn Shaangu Power is operating in a macro-environment that has been destablized by – there is increasing trade war between United States & China, cloud computing is disrupting traditional business models, increasing government debt because of Covid-19 spendings, increasing household debt because of falling income levels, increasing commodity prices, talent flight as more people leaving formal jobs, central banks are concerned over increasing inflation, increasing transportation and logistics costs, increasing inequality as vast percentage of new income is going to the top 1%, etc

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Introduction to SWOT Analysis of XiAn Shaangu Power

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that XiAn Shaangu Power can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the XiAn Shaangu Power, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which XiAn Shaangu Power 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of XiAn Shaangu Power can be done for the following purposes –
1. Strategic planning of XiAn Shaangu Power
2. Improving business portfolio management of XiAn Shaangu Power
3. Assessing feasibility of the new initiative in China
4. Making a Misc. Capital Goods sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of XiAn Shaangu Power

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Strengths of XiAn Shaangu Power | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of XiAn Shaangu Power are -

Successful track record of launching new products

– XiAn Shaangu Power has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. XiAn Shaangu Power 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.

Effective Research and Development (R&D)

– XiAn Shaangu Power has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – XiAn Shaangu Power staying ahead in the Misc. Capital Goods industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

Operational resilience

– The operational resilience strategy of XiAn Shaangu Power comprises – understanding the underlying the factors in the Misc. Capital Goods 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

– XiAn Shaangu Power has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled XiAn Shaangu Power to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Analytics focus

– XiAn Shaangu Power 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. Capital Goods 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

- XiAn Shaangu Power 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 XiAn Shaangu Power is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at XiAn Shaangu Power emphasize – knowledge, initiative, and innovation.

Training and development

– XiAn Shaangu Power has one of the best training and development program in Capital Goods 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.

Digital Transformation in Misc. Capital Goods industry

- digital transformation varies from industry to industry. For XiAn Shaangu Power digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. XiAn Shaangu Power 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.

Organizational Resilience of XiAn Shaangu Power

– The covid-19 pandemic has put organizational resilience at the centre of everthing XiAn Shaangu Power does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.

Ability to lead change in Misc. Capital Goods

– XiAn Shaangu Power is one of the leading players in the Misc. Capital Goods industry in China. Over the years it has not only transformed the business landscape in the Misc. Capital Goods industry in China but also across the existing markets. The ability to lead change has enabled XiAn Shaangu Power 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 XiAn Shaangu Power 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.

Diverse revenue streams

– XiAn Shaangu Power is present in almost all the verticals within the Misc. Capital Goods industry. This has provided XiAn Shaangu Power 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.

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Weaknesses of XiAn Shaangu Power | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of XiAn Shaangu Power are -

High cash cycle compare to competitors

XiAn Shaangu Power has a high cash cycle compare to other players in the Misc. Capital Goods industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.

Skills based hiring in Misc. Capital Goods industry

– The stress on hiring functional specialists at XiAn Shaangu Power 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.

Need for greater diversity

– XiAn Shaangu Power 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.

Aligning sales with marketing

– From the outside it seems that XiAn Shaangu Power needs to have more collaboration between its sales team and marketing team. Sales professionals in the Misc. Capital Goods industry have deep experience in developing customer relationships. Marketing department at XiAn Shaangu Power can leverage the sales team experience to cultivate customer relationships as XiAn Shaangu Power is planning to shift buying processes online.

High operating costs

– Compare to the competitors, XiAn Shaangu Power has high operating costs in the Misc. Capital Goods industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract XiAn Shaangu Power lucrative customers.

Ability to respond to the competition

– As the decision making is very deliberative at XiAn Shaangu Power, in the dynamic environment of Misc. Capital Goods industry it has struggled to respond to the nimble upstart competition. XiAn Shaangu Power has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

Compensation and incentives

– The revenue per employee of XiAn Shaangu Power is just above the Misc. Capital Goods 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.

Increasing silos among functional specialists

– The organizational structure of XiAn Shaangu Power is dominated by functional specialists. It is not different from other players in the Misc. Capital Goods industry, but XiAn Shaangu Power needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help XiAn Shaangu Power to focus more on services in the Misc. Capital Goods industry rather than just following the product oriented approach.

High dependence on XiAn Shaangu Power ‘s star products

– The top 2 products and services of XiAn Shaangu Power still accounts for major business revenue. This dependence on star products in Misc. Capital Goods industry has resulted into insufficient focus on developing new products, even though XiAn Shaangu Power has relatively successful track record of launching new products.

High bargaining power of channel partners in Misc. Capital Goods industry

– because of the regulatory requirements in China, XiAn Shaangu Power 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 Misc. Capital Goods industry.

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 XiAn Shaangu Power supply chain. Even after few cautionary changes, XiAn Shaangu Power is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left XiAn Shaangu Power vulnerable to further global disruptions in South East Asia.

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XiAn Shaangu Power Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of XiAn Shaangu Power are -

Buying journey improvements

– XiAn Shaangu Power can improve the customer journey of consumers in the Misc. Capital Goods 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.

Better consumer reach

– The expansion of the 5G network will help XiAn Shaangu Power to increase its market reach. XiAn Shaangu Power 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.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for XiAn Shaangu Power 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 XiAn Shaangu Power to hire the very best people irrespective of their geographical location.

Learning at scale

– Online learning technologies has now opened space for XiAn Shaangu Power to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.

Leveraging digital technologies

– XiAn Shaangu Power 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.

Finding new ways to collaborate

– Covid-19 has not only transformed business models of companies in Misc. Capital Goods industry, but it has also influenced the consumer preferences. XiAn Shaangu Power can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, XiAn Shaangu Power can use these opportunities to build new business models that can help the communities that XiAn Shaangu Power operates in. Secondly it can use opportunities from government spending in Misc. Capital Goods sector.

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects XiAn Shaangu Power can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

Building a culture of innovation

– managers at XiAn Shaangu Power 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. Capital Goods industry.

Redefining models of collaboration and team work

– As explained in the weaknesses section, XiAn Shaangu Power is facing challenges because of the dominance of functional experts in the organization. XiAn Shaangu Power can utilize new technology in the field of Misc. Capital Goods industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.

Lowering marketing communication costs

– 5G expansion will open new opportunities for XiAn Shaangu Power 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. Capital Goods industry, and it will provide faster access to the consumers.

Low interest rates

– Even though inflation is raising its head in most developed economies, XiAn Shaangu Power 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.

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. XiAn Shaangu Power can explore opportunities that can attract volunteers and are consistent with its mission and vision.

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Threats XiAn Shaangu Power External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of XiAn Shaangu Power are -

Regulatory challenges

– XiAn Shaangu Power 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 Misc. Capital Goods industry regulations.

Increasing wage structure of XiAn Shaangu Power

– 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 XiAn Shaangu Power.

Technology acceleration in Forth Industrial Revolution

– XiAn Shaangu Power has witnessed rapid integration of technology during Covid-19 in the Misc. Capital Goods industry. As one of the leading players in the industry, XiAn Shaangu Power needs to keep up with the evolution of technology in the Misc. Capital Goods 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.

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 XiAn Shaangu Power in the Misc. Capital Goods sector and impact the bottomline of the organization.

High dependence on third party suppliers

– XiAn Shaangu Power 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.

Shortening product life cycle

– it is one of the major threat that XiAn Shaangu Power is facing in Misc. Capital Goods sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for XiAn Shaangu Power in Misc. Capital Goods industry. The Misc. Capital Goods 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.

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.

Stagnating economy with rate increase

– XiAn Shaangu Power 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. Capital Goods industry.

Environmental challenges

– XiAn Shaangu Power 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. XiAn Shaangu Power can take advantage of this fund but it will also bring new competitors in the Misc. Capital Goods 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. XiAn Shaangu Power 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.

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 XiAn Shaangu Power business can come under increasing regulations regarding data privacy, data security, etc.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry to Misc. Capital Goods industry are lowering. It can presents XiAn Shaangu Power with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Misc. Capital Goods sector.

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Weighted SWOT Analysis of XiAn Shaangu Power Template, Example

Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at XiAn Shaangu Power 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 XiAn Shaangu Power 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 XiAn Shaangu Power 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 XiAn Shaangu Power 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 XiAn Shaangu Power needs to make to build a sustainable competitive advantage.

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