SWOT Analysis / TOWS Matrix for Shanghai Xin Nanyang (China)
Based on various researches at Oak Spring University , Shanghai Xin Nanyang is operating in a macro-environment that has been destablized by – competitive advantages are harder to sustain because of technology dispersion, cloud computing is disrupting traditional business models, geopolitical disruptions, increasing government debt because of Covid-19 spendings, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing commodity prices, there is backlash against globalization,
increasing energy prices, technology disruption, etc
Introduction to SWOT Analysis of Shanghai Xin Nanyang
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Shanghai Xin Nanyang can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Shanghai Xin Nanyang, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Shanghai Xin Nanyang 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 Shanghai Xin Nanyang can be done for the following purposes –
1. Strategic planning of Shanghai Xin Nanyang
2. Improving business portfolio management of Shanghai Xin Nanyang
3. Assessing feasibility of the new initiative in China
4. Making a Schools sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Shanghai Xin Nanyang
Strengths of Shanghai Xin Nanyang | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Shanghai Xin Nanyang are -
Ability to lead change in Schools
– Shanghai Xin Nanyang is one of the leading players in the Schools industry in China. Over the years it has not only transformed the business landscape in the Schools industry in China but also across the existing markets. The ability to lead change has enabled Shanghai Xin Nanyang in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High brand equity
– Shanghai Xin Nanyang has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Shanghai Xin Nanyang to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Organizational Resilience of Shanghai Xin Nanyang
– The covid-19 pandemic has put organizational resilience at the centre of everthing Shanghai Xin Nanyang does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Strong track record of project management in the Schools industry
– Shanghai Xin Nanyang is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Training and development
– Shanghai Xin Nanyang has one of the best training and development program in Services 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.
Cross disciplinary teams
– Horizontal connected teams at the Shanghai Xin Nanyang 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.
High switching costs
– The high switching costs that Shanghai Xin Nanyang 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 Shanghai Xin Nanyang in Schools industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Operational resilience
– The operational resilience strategy of Shanghai Xin Nanyang comprises – understanding the underlying the factors in the Schools 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
– Shanghai Xin Nanyang has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Schools industry. Secondly the value chain collaborators of Shanghai Xin Nanyang have helped the firm to develop new products and bring them quickly to the marketplace.
Effective Research and Development (R&D)
– Shanghai Xin Nanyang has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Shanghai Xin Nanyang staying ahead in the Schools industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Diverse revenue streams
– Shanghai Xin Nanyang is present in almost all the verticals within the Schools industry. This has provided Shanghai Xin Nanyang 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.
Weaknesses of Shanghai Xin Nanyang | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Shanghai Xin Nanyang are -
Lack of clear differentiation of Shanghai Xin Nanyang products
– To increase the profitability and margins on the products, Shanghai Xin Nanyang needs to provide more differentiated products than what it is currently offering in the marketplace.
High operating costs
– Compare to the competitors, Shanghai Xin Nanyang has high operating costs in the Schools industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Shanghai Xin Nanyang lucrative customers.
Aligning sales with marketing
– From the outside it seems that Shanghai Xin Nanyang needs to have more collaboration between its sales team and marketing team. Sales professionals in the Schools industry have deep experience in developing customer relationships. Marketing department at Shanghai Xin Nanyang can leverage the sales team experience to cultivate customer relationships as Shanghai Xin Nanyang is planning to shift buying processes online.
Skills based hiring in Schools industry
– The stress on hiring functional specialists at Shanghai Xin Nanyang 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Shanghai Xin Nanyang is slow explore the new channels of communication. These new channels of communication can help Shanghai Xin Nanyang to provide better information regarding Schools products and services. It can also build an online community to further reach out to potential customers.
Low market penetration in new markets
– Outside its home market of China, Shanghai Xin Nanyang needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Ability to respond to the competition
– As the decision making is very deliberative at Shanghai Xin Nanyang, in the dynamic environment of Schools industry it has struggled to respond to the nimble upstart competition. Shanghai Xin Nanyang has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Need for greater diversity
– Shanghai Xin Nanyang 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.
Employees’ less understanding of Shanghai Xin Nanyang strategy
– From the outside it seems that the employees of Shanghai Xin Nanyang 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.
Increasing silos among functional specialists
– The organizational structure of Shanghai Xin Nanyang is dominated by functional specialists. It is not different from other players in the Schools industry, but Shanghai Xin Nanyang needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Shanghai Xin Nanyang to focus more on services in the Schools industry rather than just following the product oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Shanghai Xin Nanyang 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 Schools industry using digital technology.
Shanghai Xin Nanyang Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Shanghai Xin Nanyang are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Shanghai Xin Nanyang in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Schools industry, and it will provide faster access to the consumers.
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. Shanghai Xin Nanyang can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Schools industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Shanghai Xin Nanyang 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. Shanghai Xin Nanyang 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.
Using analytics as competitive advantage
– Shanghai Xin Nanyang has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Schools sector. This continuous investment in analytics has enabled Shanghai Xin Nanyang to build a competitive advantage using analytics. The analytics driven competitive advantage can help Shanghai Xin Nanyang to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Loyalty marketing
– Shanghai Xin Nanyang 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Shanghai Xin Nanyang can use these opportunities to build new business models that can help the communities that Shanghai Xin Nanyang operates in. Secondly it can use opportunities from government spending in Schools sector.
Low interest rates
– Even though inflation is raising its head in most developed economies, Shanghai Xin Nanyang 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.
Use of Bitcoin and other crypto currencies for transactions in Schools industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Shanghai Xin Nanyang in the Schools industry. Now Shanghai Xin Nanyang can target international markets with far fewer capital restrictions requirements than the existing system.
Manufacturing automation
– Shanghai Xin Nanyang can use the latest technology developments to improve its manufacturing and designing process in Schools 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.
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 Shanghai Xin Nanyang 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.
Buying journey improvements
– Shanghai Xin Nanyang can improve the customer journey of consumers in the Schools 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 Shanghai Xin Nanyang 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 Schools industry.
Learning at scale
– Online learning technologies has now opened space for Shanghai Xin Nanyang 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.
Threats Shanghai Xin Nanyang External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Shanghai Xin Nanyang are -
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, Shanghai Xin Nanyang may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Schools sector.
Regulatory challenges
– Shanghai Xin Nanyang 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 Schools industry regulations.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Shanghai Xin Nanyang 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.
Consumer confidence and its impact on Shanghai Xin Nanyang 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 Schools industry and other sectors.
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.
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 Shanghai Xin Nanyang in the Schools sector and impact the bottomline of the organization.
Increasing wage structure of Shanghai Xin Nanyang
– 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 Shanghai Xin Nanyang.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Schools industry are lowering. It can presents Shanghai Xin Nanyang with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Schools sector.
High dependence on third party suppliers
– Shanghai Xin Nanyang 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.
Environmental challenges
– Shanghai Xin Nanyang 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. Shanghai Xin Nanyang can take advantage of this fund but it will also bring new competitors in the Schools industry.
Technology acceleration in Forth Industrial Revolution
– Shanghai Xin Nanyang has witnessed rapid integration of technology during Covid-19 in the Schools industry. As one of the leading players in the industry, Shanghai Xin Nanyang needs to keep up with the evolution of technology in the Schools 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.
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 Shanghai Xin Nanyang.
Weighted SWOT Analysis of Shanghai Xin Nanyang Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Shanghai Xin Nanyang 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 Shanghai Xin Nanyang 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 Shanghai Xin Nanyang 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 Shanghai Xin Nanyang 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 Shanghai Xin Nanyang needs to make to build a sustainable competitive advantage.