Beijing Haohua Energy Resource (601101) SWOT Analysis / TOWS Matrix / MBA Resources
Coal
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Beijing Haohua Energy Resource (China)
Based on various researches at Oak Spring University , Beijing Haohua Energy Resource is operating in a macro-environment that has been destablized by – increasing transportation and logistics costs, supply chains are disrupted by pandemic , technology disruption, increasing commodity prices, increasing household debt because of falling income levels, there is increasing trade war between United States & China, increasing energy prices,
challanges to central banks by blockchain based private currencies, wage bills are increasing, etc
Introduction to SWOT Analysis of Beijing Haohua Energy Resource
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Beijing Haohua Energy Resource can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Beijing Haohua Energy Resource, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Beijing Haohua Energy Resource 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 Beijing Haohua Energy Resource can be done for the following purposes –
1. Strategic planning of Beijing Haohua Energy Resource
2. Improving business portfolio management of Beijing Haohua Energy Resource
3. Assessing feasibility of the new initiative in China
4. Making a Coal sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Beijing Haohua Energy Resource
Strengths of Beijing Haohua Energy Resource | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Beijing Haohua Energy Resource are -
Effective Research and Development (R&D)
– Beijing Haohua Energy Resource has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Beijing Haohua Energy Resource staying ahead in the Coal industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Diverse revenue streams
– Beijing Haohua Energy Resource is present in almost all the verticals within the Coal industry. This has provided Beijing Haohua Energy Resource 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.
Learning organization
- Beijing Haohua Energy Resource 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 Beijing Haohua Energy Resource is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Beijing Haohua Energy Resource emphasize – knowledge, initiative, and innovation.
Operational resilience
– The operational resilience strategy of Beijing Haohua Energy Resource comprises – understanding the underlying the factors in the Coal industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Successful track record of launching new products
– Beijing Haohua Energy Resource has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Beijing Haohua Energy Resource 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.
Training and development
– Beijing Haohua Energy Resource has one of the best training and development program in Energy 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.
Analytics focus
– Beijing Haohua Energy Resource 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 Coal 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.
Highly skilled collaborators
– Beijing Haohua Energy Resource has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Coal industry. Secondly the value chain collaborators of Beijing Haohua Energy Resource have helped the firm to develop new products and bring them quickly to the marketplace.
Superior customer experience
– The customer experience strategy of Beijing Haohua Energy Resource in Coal industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High switching costs
– The high switching costs that Beijing Haohua Energy Resource 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.
Organizational Resilience of Beijing Haohua Energy Resource
– The covid-19 pandemic has put organizational resilience at the centre of everthing Beijing Haohua Energy Resource does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to lead change in Coal
– Beijing Haohua Energy Resource is one of the leading players in the Coal industry in China. Over the years it has not only transformed the business landscape in the Coal industry in China but also across the existing markets. The ability to lead change has enabled Beijing Haohua Energy Resource in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Weaknesses of Beijing Haohua Energy Resource | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Beijing Haohua Energy Resource are -
Ability to respond to the competition
– As the decision making is very deliberative at Beijing Haohua Energy Resource, in the dynamic environment of Coal industry it has struggled to respond to the nimble upstart competition. Beijing Haohua Energy Resource has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High operating costs
– Compare to the competitors, Beijing Haohua Energy Resource has high operating costs in the Coal industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Beijing Haohua Energy Resource lucrative customers.
Aligning sales with marketing
– From the outside it seems that Beijing Haohua Energy Resource needs to have more collaboration between its sales team and marketing team. Sales professionals in the Coal industry have deep experience in developing customer relationships. Marketing department at Beijing Haohua Energy Resource can leverage the sales team experience to cultivate customer relationships as Beijing Haohua Energy Resource is planning to shift buying processes online.
Employees’ less understanding of Beijing Haohua Energy Resource strategy
– From the outside it seems that the employees of Beijing Haohua Energy Resource 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.
Workers concerns about automation
– As automation is fast increasing in the Coal industry, Beijing Haohua Energy Resource 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 cash cycle compare to competitors
Beijing Haohua Energy Resource has a high cash cycle compare to other players in the Coal industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Interest costs
– Compare to the competition, Beijing Haohua Energy Resource 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.
Lack of clear differentiation of Beijing Haohua Energy Resource products
– To increase the profitability and margins on the products, Beijing Haohua Energy Resource needs to provide more differentiated products than what it is currently offering in the marketplace.
Capital Spending Reduction
– Even during the low interest decade, Beijing Haohua Energy Resource 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 Coal industry using digital technology.
Compensation and incentives
– The revenue per employee of Beijing Haohua Energy Resource is just above the Coal 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.
High dependence on Beijing Haohua Energy Resource ‘s star products
– The top 2 products and services of Beijing Haohua Energy Resource still accounts for major business revenue. This dependence on star products in Coal industry has resulted into insufficient focus on developing new products, even though Beijing Haohua Energy Resource has relatively successful track record of launching new products.
Beijing Haohua Energy Resource Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Beijing Haohua Energy Resource are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Beijing Haohua Energy Resource 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 Beijing Haohua Energy Resource to hire the very best people irrespective of their geographical location.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Beijing Haohua Energy Resource can use these opportunities to build new business models that can help the communities that Beijing Haohua Energy Resource operates in. Secondly it can use opportunities from government spending in Coal sector.
Low interest rates
– Even though inflation is raising its head in most developed economies, Beijing Haohua Energy Resource can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Loyalty marketing
– Beijing Haohua Energy Resource 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.
Learning at scale
– Online learning technologies has now opened space for Beijing Haohua Energy Resource 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Coal industry, but it has also influenced the consumer preferences. Beijing Haohua Energy Resource can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Creating value in data economy
– The success of analytics program of Beijing Haohua Energy Resource has opened avenues for new revenue streams for the organization in Coal industry. This can help Beijing Haohua Energy Resource to build a more holistic ecosystem for Beijing Haohua Energy Resource products in the Coal industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Manufacturing automation
– Beijing Haohua Energy Resource can use the latest technology developments to improve its manufacturing and designing process in Coal 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.
Use of Bitcoin and other crypto currencies for transactions in Coal industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Beijing Haohua Energy Resource in the Coal industry. Now Beijing Haohua Energy Resource can target international markets with far fewer capital restrictions requirements than the existing system.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Beijing Haohua Energy Resource can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Buying journey improvements
– Beijing Haohua Energy Resource can improve the customer journey of consumers in the Coal industry by using analytics and artificial intelligence. It can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Beijing Haohua Energy Resource is facing challenges because of the dominance of functional experts in the organization. Beijing Haohua Energy Resource can utilize new technology in the field of Coal industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
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. Beijing Haohua Energy Resource can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats Beijing Haohua Energy Resource External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Beijing Haohua Energy Resource are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Beijing Haohua Energy Resource 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 Beijing Haohua Energy Resource prominent markets.
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. Beijing Haohua Energy Resource 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, Beijing Haohua Energy Resource may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Coal sector.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Beijing Haohua Energy Resource in Coal industry. The Coal 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.
High dependence on third party suppliers
– Beijing Haohua Energy Resource 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.
Easy access to finance
– Easy access to finance in Coal industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Beijing Haohua Energy Resource 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 Beijing Haohua Energy Resource.
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 Beijing Haohua Energy Resource business can come under increasing regulations regarding data privacy, data security, etc.
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.
Shortening product life cycle
– it is one of the major threat that Beijing Haohua Energy Resource is facing in Coal sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Regulatory challenges
– Beijing Haohua Energy Resource needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Coal industry regulations.
Consumer confidence and its impact on Beijing Haohua Energy Resource demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in Coal industry and other sectors.
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 Beijing Haohua Energy Resource in the Coal sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Beijing Haohua Energy Resource Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Beijing Haohua Energy Resource 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 Beijing Haohua Energy Resource 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 Beijing Haohua Energy Resource 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 Beijing Haohua Energy Resource 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 Beijing Haohua Energy Resource needs to make to build a sustainable competitive advantage.