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 government debt because of Covid-19 spendings, competitive advantages are harder to sustain because of technology dispersion, increasing transportation and logistics costs, increasing household debt because of falling income levels, increasing commodity prices, there is backlash against globalization, cloud computing is disrupting traditional business models,
digital marketing is dominated by two big players Facebook and Google, geopolitical disruptions, 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 -
Sustainable margins compare to other players in Coal industry
– Beijing Haohua Energy Resource has clearly differentiated products in the market place. This has enabled Beijing Haohua Energy Resource to fetch slight price premium compare to the competitors in the Coal industry. The sustainable margins have also helped Beijing Haohua Energy Resource to invest into research and development (R&D) and innovation.
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.
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.
High brand equity
– Beijing Haohua Energy Resource has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Beijing Haohua Energy Resource to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
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.
Strong track record of project management in the Coal industry
– Beijing Haohua Energy Resource is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Low bargaining power of suppliers
– Suppliers of Beijing Haohua Energy Resource in the Energy sector have low bargaining power. Beijing Haohua Energy Resource has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Beijing Haohua Energy Resource to manage not only supply disruptions but also source products at highly competitive prices.
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.
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.
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.
Digital Transformation in Coal industry
- digital transformation varies from industry to industry. For Beijing Haohua Energy Resource digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Beijing Haohua Energy Resource 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.
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.
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 -
Need for greater diversity
– Beijing Haohua Energy Resource 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.
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.
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 Beijing Haohua Energy Resource supply chain. Even after few cautionary changes, Beijing Haohua Energy Resource is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Beijing Haohua Energy Resource vulnerable to further global disruptions in South East Asia.
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.
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.
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 bargaining power of channel partners in Coal industry
– because of the regulatory requirements in China, Beijing Haohua Energy Resource 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 Coal industry.
Skills based hiring in Coal industry
– The stress on hiring functional specialists at Beijing Haohua Energy Resource 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.
Low market penetration in new markets
– Outside its home market of China, Beijing Haohua Energy Resource needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
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 -
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.
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 Beijing Haohua Energy Resource 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Beijing Haohua Energy Resource 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 Beijing Haohua Energy Resource to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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.
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.
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.
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.
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.
Building a culture of innovation
– managers at Beijing Haohua Energy Resource 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 Coal industry.
Better consumer reach
– The expansion of the 5G network will help Beijing Haohua Energy Resource to increase its market reach. Beijing Haohua Energy Resource 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Beijing Haohua Energy Resource in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Coal industry, and it will provide faster access to the consumers.
Using analytics as competitive advantage
– Beijing Haohua Energy Resource has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Coal sector. This continuous investment in analytics has enabled Beijing Haohua Energy Resource to build a competitive advantage using analytics. The analytics driven competitive advantage can help Beijing Haohua Energy Resource to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Developing new processes and practices
– Beijing Haohua Energy Resource can develop new processes and procedures in Coal 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.
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 -
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.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Coal industry are lowering. It can presents Beijing Haohua Energy Resource with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Coal sector.
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. Beijing Haohua Energy Resource needs to understand the core reasons impacting the Coal industry. This will help it in building a better workplace.
Environmental challenges
– Beijing Haohua Energy Resource 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. Beijing Haohua Energy Resource can take advantage of this fund but it will also bring new competitors in the Coal industry.
Increasing wage structure of Beijing Haohua Energy Resource
– 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 Beijing Haohua Energy Resource.
Technology acceleration in Forth Industrial Revolution
– Beijing Haohua Energy Resource has witnessed rapid integration of technology during Covid-19 in the Coal industry. As one of the leading players in the industry, Beijing Haohua Energy Resource needs to keep up with the evolution of technology in the Coal 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.
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.
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.
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.
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.
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.
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.
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.