SWOT Analysis / TOWS Matrix for Sichuan Expressway (China)
Based on various researches at Oak Spring University , Sichuan Expressway is operating in a macro-environment that has been destablized by – cloud computing is disrupting traditional business models, banking and financial system is disrupted by Bitcoin and other crypto currencies, competitive advantages are harder to sustain because of technology dispersion, talent flight as more people leaving formal jobs, there is backlash against globalization, increasing energy prices, increasing household debt because of falling income levels,
challanges to central banks by blockchain based private currencies, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Sichuan Expressway
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Sichuan Expressway can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Sichuan Expressway, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Sichuan Expressway 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 Sichuan Expressway can be done for the following purposes –
1. Strategic planning of Sichuan Expressway
2. Improving business portfolio management of Sichuan Expressway
3. Assessing feasibility of the new initiative in China
4. Making a Misc. Transportation sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Sichuan Expressway
Strengths of Sichuan Expressway | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Sichuan Expressway are -
Superior customer experience
– The customer experience strategy of Sichuan Expressway in Misc. Transportation industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– Sichuan Expressway has one of the best training and development program in Transportation 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.
Ability to recruit top talent
– Sichuan Expressway is one of the leading players in the Misc. Transportation 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.
Cross disciplinary teams
– Horizontal connected teams at the Sichuan Expressway 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.
Operational resilience
– The operational resilience strategy of Sichuan Expressway comprises – understanding the underlying the factors in the Misc. Transportation 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.
Highly skilled collaborators
– Sichuan Expressway has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Misc. Transportation industry. Secondly the value chain collaborators of Sichuan Expressway have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Sichuan Expressway is one of the most innovative firm in Misc. Transportation sector.
Ability to lead change in Misc. Transportation
– Sichuan Expressway is one of the leading players in the Misc. Transportation industry in China. Over the years it has not only transformed the business landscape in the Misc. Transportation industry in China but also across the existing markets. The ability to lead change has enabled Sichuan Expressway in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Successful track record of launching new products
– Sichuan Expressway has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Sichuan Expressway 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 Misc. Transportation industry
- digital transformation varies from industry to industry. For Sichuan Expressway digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Sichuan Expressway 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.
Sustainable margins compare to other players in Misc. Transportation industry
– Sichuan Expressway has clearly differentiated products in the market place. This has enabled Sichuan Expressway to fetch slight price premium compare to the competitors in the Misc. Transportation industry. The sustainable margins have also helped Sichuan Expressway to invest into research and development (R&D) and innovation.
Organizational Resilience of Sichuan Expressway
– The covid-19 pandemic has put organizational resilience at the centre of everthing Sichuan Expressway does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses of Sichuan Expressway | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Sichuan Expressway are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Sichuan Expressway is slow explore the new channels of communication. These new channels of communication can help Sichuan Expressway to provide better information regarding Misc. Transportation products and services. It can also build an online community to further reach out to potential customers.
Lack of clear differentiation of Sichuan Expressway products
– To increase the profitability and margins on the products, Sichuan Expressway needs to provide more differentiated products than what it is currently offering in the marketplace.
High dependence on Sichuan Expressway ‘s star products
– The top 2 products and services of Sichuan Expressway still accounts for major business revenue. This dependence on star products in Misc. Transportation industry has resulted into insufficient focus on developing new products, even though Sichuan Expressway has relatively successful track record of launching new products.
High bargaining power of channel partners in Misc. Transportation industry
– because of the regulatory requirements in China, Sichuan Expressway 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. Transportation industry.
Employees’ less understanding of Sichuan Expressway strategy
– From the outside it seems that the employees of Sichuan Expressway 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.
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 Sichuan Expressway supply chain. Even after few cautionary changes, Sichuan Expressway is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Sichuan Expressway vulnerable to further global disruptions in South East Asia.
Low market penetration in new markets
– Outside its home market of China, Sichuan Expressway needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Increasing silos among functional specialists
– The organizational structure of Sichuan Expressway is dominated by functional specialists. It is not different from other players in the Misc. Transportation industry, but Sichuan Expressway needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Sichuan Expressway to focus more on services in the Misc. Transportation industry rather than just following the product oriented approach.
Need for greater diversity
– Sichuan Expressway 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.
High operating costs
– Compare to the competitors, Sichuan Expressway has high operating costs in the Misc. Transportation industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Sichuan Expressway lucrative customers.
Capital Spending Reduction
– Even during the low interest decade, Sichuan Expressway 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 Misc. Transportation industry using digital technology.
Sichuan Expressway Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Sichuan Expressway are -
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Misc. Transportation industry, but it has also influenced the consumer preferences. Sichuan Expressway can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Loyalty marketing
– Sichuan Expressway 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.
Manufacturing automation
– Sichuan Expressway can use the latest technology developments to improve its manufacturing and designing process in Misc. Transportation 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 Misc. Transportation industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Sichuan Expressway 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. Sichuan Expressway 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Sichuan Expressway 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. Transportation industry, and it will provide faster access to the consumers.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Sichuan Expressway 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 Sichuan Expressway to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Sichuan Expressway can use these opportunities to build new business models that can help the communities that Sichuan Expressway operates in. Secondly it can use opportunities from government spending in Misc. Transportation sector.
Low interest rates
– Even though inflation is raising its head in most developed economies, Sichuan Expressway 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.
Leveraging digital technologies
– Sichuan Expressway 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.
Using analytics as competitive advantage
– Sichuan Expressway has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Misc. Transportation sector. This continuous investment in analytics has enabled Sichuan Expressway to build a competitive advantage using analytics. The analytics driven competitive advantage can help Sichuan Expressway to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Use of Bitcoin and other crypto currencies for transactions in Misc. Transportation industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Sichuan Expressway in the Misc. Transportation industry. Now Sichuan Expressway can target international markets with far fewer capital restrictions requirements than the existing system.
Buying journey improvements
– Sichuan Expressway can improve the customer journey of consumers in the Misc. Transportation 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.
Building a culture of innovation
– managers at Sichuan Expressway 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. Transportation industry.
Threats Sichuan Expressway External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Sichuan Expressway are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Sichuan Expressway in Misc. Transportation industry. The Misc. Transportation 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Sichuan Expressway may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Misc. Transportation 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.
Shortening product life cycle
– it is one of the major threat that Sichuan Expressway is facing in Misc. Transportation sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Sichuan Expressway 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.
Regulatory challenges
– Sichuan Expressway 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. Transportation industry regulations.
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 Sichuan Expressway in the Misc. Transportation sector and impact the bottomline of the organization.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Sichuan Expressway needs to understand the core reasons impacting the Misc. Transportation industry. This will help it in building a better workplace.
Increasing wage structure of Sichuan Expressway
– 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 Sichuan Expressway.
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 Sichuan Expressway.
Technology acceleration in Forth Industrial Revolution
– Sichuan Expressway has witnessed rapid integration of technology during Covid-19 in the Misc. Transportation industry. As one of the leading players in the industry, Sichuan Expressway needs to keep up with the evolution of technology in the Misc. Transportation sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Environmental challenges
– Sichuan Expressway 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. Sichuan Expressway can take advantage of this fund but it will also bring new competitors in the Misc. Transportation industry.
Weighted SWOT Analysis of Sichuan Expressway Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Sichuan Expressway 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 Sichuan Expressway 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 Sichuan Expressway 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 Sichuan Expressway 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 Sichuan Expressway needs to make to build a sustainable competitive advantage.