Zhengzhou Sino Crystal Diamond (300064) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Zhengzhou Sino Crystal Diamond (China)

Based on various researches at Oak Spring University , Zhengzhou Sino Crystal Diamond is operating in a macro-environment that has been destablized by – increasing government debt because of Covid-19 spendings, technology disruption, supply chains are disrupted by pandemic , increasing commodity prices, competitive advantages are harder to sustain because of technology dispersion, increasing household debt because of falling income levels, there is backlash against globalization, increasing transportation and logistics costs, there is increasing trade war between United States & China, etc

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Introduction to SWOT Analysis of Zhengzhou Sino Crystal Diamond

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

According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of Zhengzhou Sino Crystal Diamond can be done for the following purposes –
1. Strategic planning of Zhengzhou Sino Crystal Diamond
2. Improving business portfolio management of Zhengzhou Sino Crystal Diamond
3. Assessing feasibility of the new initiative in China
4. Making a Metal Mining sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Zhengzhou Sino Crystal Diamond

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Strengths of Zhengzhou Sino Crystal Diamond | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Zhengzhou Sino Crystal Diamond are -

High brand equity

– Zhengzhou Sino Crystal Diamond has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Zhengzhou Sino Crystal Diamond to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Learning organization

- Zhengzhou Sino Crystal Diamond 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 Zhengzhou Sino Crystal Diamond is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Zhengzhou Sino Crystal Diamond emphasize – knowledge, initiative, and innovation.

Training and development

– Zhengzhou Sino Crystal Diamond has one of the best training and development program in Basic Materials 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 lead change in Metal Mining

– Zhengzhou Sino Crystal Diamond is one of the leading players in the Metal Mining industry in China. Over the years it has not only transformed the business landscape in the Metal Mining industry in China but also across the existing markets. The ability to lead change has enabled Zhengzhou Sino Crystal Diamond in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

Low bargaining power of suppliers

– Suppliers of Zhengzhou Sino Crystal Diamond in the Basic Materials sector have low bargaining power. Zhengzhou Sino Crystal Diamond has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Zhengzhou Sino Crystal Diamond to manage not only supply disruptions but also source products at highly competitive prices.

Organizational Resilience of Zhengzhou Sino Crystal Diamond

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

Diverse revenue streams

– Zhengzhou Sino Crystal Diamond is present in almost all the verticals within the Metal Mining industry. This has provided Zhengzhou Sino Crystal Diamond 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.

Effective Research and Development (R&D)

– Zhengzhou Sino Crystal Diamond has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Zhengzhou Sino Crystal Diamond staying ahead in the Metal Mining industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

Cross disciplinary teams

– Horizontal connected teams at the Zhengzhou Sino Crystal Diamond 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.

Analytics focus

– Zhengzhou Sino Crystal Diamond 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 Metal Mining 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.

Ability to recruit top talent

– Zhengzhou Sino Crystal Diamond is one of the leading players in the Metal Mining 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.

Superior customer experience

– The customer experience strategy of Zhengzhou Sino Crystal Diamond in Metal Mining industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

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Weaknesses of Zhengzhou Sino Crystal Diamond | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Zhengzhou Sino Crystal Diamond are -

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

Ability to respond to the competition

– As the decision making is very deliberative at Zhengzhou Sino Crystal Diamond, in the dynamic environment of Metal Mining industry it has struggled to respond to the nimble upstart competition. Zhengzhou Sino Crystal Diamond has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

Skills based hiring in Metal Mining industry

– The stress on hiring functional specialists at Zhengzhou Sino Crystal Diamond 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.

Compensation and incentives

– The revenue per employee of Zhengzhou Sino Crystal Diamond is just above the Metal Mining 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.

Capital Spending Reduction

– Even during the low interest decade, Zhengzhou Sino Crystal Diamond 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 Metal Mining industry using digital technology.

No frontier risks strategy

– From the 10K / annual statement of Zhengzhou Sino Crystal Diamond, it seems that company is thinking out the frontier risks that can impact Metal Mining industry. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.

Workers concerns about automation

– As automation is fast increasing in the Metal Mining industry, Zhengzhou Sino Crystal Diamond 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.

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Zhengzhou Sino Crystal Diamond is slow explore the new channels of communication. These new channels of communication can help Zhengzhou Sino Crystal Diamond to provide better information regarding Metal Mining products and services. It can also build an online community to further reach out to potential customers.

Increasing silos among functional specialists

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

Lack of clear differentiation of Zhengzhou Sino Crystal Diamond products

– To increase the profitability and margins on the products, Zhengzhou Sino Crystal Diamond needs to provide more differentiated products than what it is currently offering in the marketplace.

Slow to strategic competitive environment developments

– As Zhengzhou Sino Crystal Diamond is one of the leading players in the Metal Mining industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Metal Mining industry in last five years.

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Zhengzhou Sino Crystal Diamond Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of Zhengzhou Sino Crystal Diamond are -

Buying journey improvements

– Zhengzhou Sino Crystal Diamond can improve the customer journey of consumers in the Metal Mining 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.

Changes in consumer behavior post Covid-19

– consumer behavior has changed in the Metal Mining industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Zhengzhou Sino Crystal Diamond 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. Zhengzhou Sino Crystal Diamond 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.

Loyalty marketing

– Zhengzhou Sino Crystal Diamond 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.

Leveraging digital technologies

– Zhengzhou Sino Crystal Diamond 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.

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 Zhengzhou Sino Crystal Diamond 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.

Better consumer reach

– The expansion of the 5G network will help Zhengzhou Sino Crystal Diamond to increase its market reach. Zhengzhou Sino Crystal Diamond 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.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Zhengzhou Sino Crystal Diamond can use these opportunities to build new business models that can help the communities that Zhengzhou Sino Crystal Diamond operates in. Secondly it can use opportunities from government spending in Metal Mining sector.

Reforming the budgeting process

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

Lowering marketing communication costs

– 5G expansion will open new opportunities for Zhengzhou Sino Crystal Diamond in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Metal Mining industry, and it will provide faster access to the consumers.

Developing new processes and practices

– Zhengzhou Sino Crystal Diamond can develop new processes and procedures in Metal Mining 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.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Zhengzhou Sino Crystal Diamond 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 Zhengzhou Sino Crystal Diamond to hire the very best people irrespective of their geographical location.

Use of Bitcoin and other crypto currencies for transactions in Metal Mining industry

– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Zhengzhou Sino Crystal Diamond in the Metal Mining industry. Now Zhengzhou Sino Crystal Diamond can target international markets with far fewer capital restrictions requirements than the existing system.

Using analytics as competitive advantage

– Zhengzhou Sino Crystal Diamond has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Metal Mining sector. This continuous investment in analytics has enabled Zhengzhou Sino Crystal Diamond to build a competitive advantage using analytics. The analytics driven competitive advantage can help Zhengzhou Sino Crystal Diamond to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.

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Threats Zhengzhou Sino Crystal Diamond External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of Zhengzhou Sino Crystal Diamond are -

Consumer confidence and its impact on Zhengzhou Sino Crystal Diamond 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 Metal Mining industry and other sectors.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Zhengzhou Sino Crystal Diamond in Metal Mining industry. The Metal Mining 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.

Easy access to finance

– Easy access to finance in Metal Mining industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Zhengzhou Sino Crystal Diamond can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.

Increasing wage structure of Zhengzhou Sino Crystal Diamond

– 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 Zhengzhou Sino Crystal Diamond.

Shortening product life cycle

– it is one of the major threat that Zhengzhou Sino Crystal Diamond is facing in Metal Mining sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, Zhengzhou Sino Crystal Diamond may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Metal Mining sector.

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 Zhengzhou Sino Crystal Diamond business can come under increasing regulations regarding data privacy, data security, etc.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry to Metal Mining industry are lowering. It can presents Zhengzhou Sino Crystal Diamond with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Metal Mining 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.

Regulatory challenges

– Zhengzhou Sino Crystal Diamond 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 Metal Mining industry regulations.

High dependence on third party suppliers

– Zhengzhou Sino Crystal Diamond 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.

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.

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 Zhengzhou Sino Crystal Diamond.

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Weighted SWOT Analysis of Zhengzhou Sino Crystal Diamond Template, Example

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

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