Wuxi Huadong Heavy Machinery A (2685) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Wuxi Huadong Heavy Machinery A (China)

Based on various researches at Oak Spring University , Wuxi Huadong Heavy Machinery A is operating in a macro-environment that has been destablized by – customer relationship management is fast transforming because of increasing concerns over data privacy, competitive advantages are harder to sustain because of technology dispersion, cloud computing is disrupting traditional business models, digital marketing is dominated by two big players Facebook and Google, increasing commodity prices, challanges to central banks by blockchain based private currencies, supply chains are disrupted by pandemic , talent flight as more people leaving formal jobs, increasing energy prices, etc

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Introduction to SWOT Analysis of Wuxi Huadong Heavy Machinery A

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Wuxi Huadong Heavy Machinery A can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Wuxi Huadong Heavy Machinery A, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Wuxi Huadong Heavy Machinery A 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 Wuxi Huadong Heavy Machinery A can be done for the following purposes –
1. Strategic planning of Wuxi Huadong Heavy Machinery A
2. Improving business portfolio management of Wuxi Huadong Heavy Machinery A
3. Assessing feasibility of the new initiative in China
4. Making a Misc. Capital Goods sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Wuxi Huadong Heavy Machinery A

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Strengths of Wuxi Huadong Heavy Machinery A | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Wuxi Huadong Heavy Machinery A are -

Effective Research and Development (R&D)

– Wuxi Huadong Heavy Machinery A has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Wuxi Huadong Heavy Machinery A staying ahead in the Misc. Capital Goods industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

Innovation driven organization

– Wuxi Huadong Heavy Machinery A is one of the most innovative firm in Misc. Capital Goods sector.

Analytics focus

– Wuxi Huadong Heavy Machinery A 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 Misc. Capital Goods 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.

Digital Transformation in Misc. Capital Goods industry

- digital transformation varies from industry to industry. For Wuxi Huadong Heavy Machinery A digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Wuxi Huadong Heavy Machinery A 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.

Cross disciplinary teams

– Horizontal connected teams at the Wuxi Huadong Heavy Machinery A 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.

Highly skilled collaborators

– Wuxi Huadong Heavy Machinery A has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Misc. Capital Goods industry. Secondly the value chain collaborators of Wuxi Huadong Heavy Machinery A have helped the firm to develop new products and bring them quickly to the marketplace.

Ability to recruit top talent

– Wuxi Huadong Heavy Machinery A is one of the leading players in the Misc. Capital Goods 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.

Diverse revenue streams

– Wuxi Huadong Heavy Machinery A is present in almost all the verticals within the Misc. Capital Goods industry. This has provided Wuxi Huadong Heavy Machinery A 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.

High brand equity

– Wuxi Huadong Heavy Machinery A has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Wuxi Huadong Heavy Machinery A to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Successful track record of launching new products

– Wuxi Huadong Heavy Machinery A has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Wuxi Huadong Heavy Machinery A 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

– Wuxi Huadong Heavy Machinery A has one of the best training and development program in Capital Goods 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.

Low bargaining power of suppliers

– Suppliers of Wuxi Huadong Heavy Machinery A in the Capital Goods sector have low bargaining power. Wuxi Huadong Heavy Machinery A has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Wuxi Huadong Heavy Machinery A to manage not only supply disruptions but also source products at highly competitive prices.

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Weaknesses of Wuxi Huadong Heavy Machinery A | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Wuxi Huadong Heavy Machinery A are -

High cash cycle compare to competitors

Wuxi Huadong Heavy Machinery A has a high cash cycle compare to other players in the Misc. Capital Goods industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.

Employees’ less understanding of Wuxi Huadong Heavy Machinery A strategy

– From the outside it seems that the employees of Wuxi Huadong Heavy Machinery A 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.

Compensation and incentives

– The revenue per employee of Wuxi Huadong Heavy Machinery A is just above the Misc. Capital Goods 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.

Slow decision making process

– As mentioned earlier in the report, Wuxi Huadong Heavy Machinery A has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Misc. Capital Goods industry over the last five years. Wuxi Huadong Heavy Machinery A even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.

Aligning sales with marketing

– From the outside it seems that Wuxi Huadong Heavy Machinery A needs to have more collaboration between its sales team and marketing team. Sales professionals in the Misc. Capital Goods industry have deep experience in developing customer relationships. Marketing department at Wuxi Huadong Heavy Machinery A can leverage the sales team experience to cultivate customer relationships as Wuxi Huadong Heavy Machinery A is planning to shift buying processes online.

Products dominated business model

– Even though Wuxi Huadong Heavy Machinery A has some of the most successful models in the Misc. Capital Goods industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Wuxi Huadong Heavy Machinery A should strive to include more intangible value offerings along with its core products and services.

Need for greater diversity

– Wuxi Huadong Heavy Machinery A 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.

Workers concerns about automation

– As automation is fast increasing in the Misc. Capital Goods industry, Wuxi Huadong Heavy Machinery A 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.

Lack of clear differentiation of Wuxi Huadong Heavy Machinery A products

– To increase the profitability and margins on the products, Wuxi Huadong Heavy Machinery A needs to provide more differentiated products than what it is currently offering in the marketplace.

High operating costs

– Compare to the competitors, Wuxi Huadong Heavy Machinery A has high operating costs in the Misc. Capital Goods industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Wuxi Huadong Heavy Machinery A lucrative customers.

Slow to strategic competitive environment developments

– As Wuxi Huadong Heavy Machinery A is one of the leading players in the Misc. Capital Goods industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Misc. Capital Goods industry in last five years.

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Wuxi Huadong Heavy Machinery A Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of Wuxi Huadong Heavy Machinery A are -

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Wuxi Huadong Heavy Machinery A 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 Wuxi Huadong Heavy Machinery A to hire the very best people irrespective of their geographical location.

Loyalty marketing

– Wuxi Huadong Heavy Machinery A 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.

Developing new processes and practices

– Wuxi Huadong Heavy Machinery A can develop new processes and procedures in Misc. Capital Goods 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.

Low interest rates

– Even though inflation is raising its head in most developed economies, Wuxi Huadong Heavy Machinery A 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.

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. Wuxi Huadong Heavy Machinery A can explore opportunities that can attract volunteers and are consistent with its mission and vision.

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 Wuxi Huadong Heavy Machinery A 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.

Use of Bitcoin and other crypto currencies for transactions in Misc. Capital Goods industry

– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Wuxi Huadong Heavy Machinery A in the Misc. Capital Goods industry. Now Wuxi Huadong Heavy Machinery A can target international markets with far fewer capital restrictions requirements than the existing system.

Manufacturing automation

– Wuxi Huadong Heavy Machinery A can use the latest technology developments to improve its manufacturing and designing process in Misc. Capital Goods 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.

Redefining models of collaboration and team work

– As explained in the weaknesses section, Wuxi Huadong Heavy Machinery A is facing challenges because of the dominance of functional experts in the organization. Wuxi Huadong Heavy Machinery A can utilize new technology in the field of Misc. Capital Goods industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.

Buying journey improvements

– Wuxi Huadong Heavy Machinery A can improve the customer journey of consumers in the Misc. Capital Goods 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.

Lowering marketing communication costs

– 5G expansion will open new opportunities for Wuxi Huadong Heavy Machinery A in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Misc. Capital Goods industry, and it will provide faster access to the consumers.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Wuxi Huadong Heavy Machinery A can use these opportunities to build new business models that can help the communities that Wuxi Huadong Heavy Machinery A operates in. Secondly it can use opportunities from government spending in Misc. Capital Goods sector.

Using analytics as competitive advantage

– Wuxi Huadong Heavy Machinery A has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Misc. Capital Goods sector. This continuous investment in analytics has enabled Wuxi Huadong Heavy Machinery A to build a competitive advantage using analytics. The analytics driven competitive advantage can help Wuxi Huadong Heavy Machinery A 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 Wuxi Huadong Heavy Machinery A External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of Wuxi Huadong Heavy Machinery A are -

Environmental challenges

– Wuxi Huadong Heavy Machinery A 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. Wuxi Huadong Heavy Machinery A can take advantage of this fund but it will also bring new competitors in the Misc. Capital Goods industry.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Wuxi Huadong Heavy Machinery A in Misc. Capital Goods industry. The Misc. Capital Goods 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.

Increasing wage structure of Wuxi Huadong Heavy Machinery A

– 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 Wuxi Huadong Heavy Machinery A.

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 Wuxi Huadong Heavy Machinery A business can come under increasing regulations regarding data privacy, data security, etc.

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, Wuxi Huadong Heavy Machinery A may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Misc. Capital Goods sector.

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.

Stagnating economy with rate increase

– Wuxi Huadong Heavy Machinery A can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the Misc. Capital Goods industry.

Consumer confidence and its impact on Wuxi Huadong Heavy Machinery A 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 Misc. Capital Goods industry and other sectors.

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.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry to Misc. Capital Goods industry are lowering. It can presents Wuxi Huadong Heavy Machinery A with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Misc. Capital Goods sector.

Technology acceleration in Forth Industrial Revolution

– Wuxi Huadong Heavy Machinery A has witnessed rapid integration of technology during Covid-19 in the Misc. Capital Goods industry. As one of the leading players in the industry, Wuxi Huadong Heavy Machinery A needs to keep up with the evolution of technology in the Misc. Capital Goods 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 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. Wuxi Huadong Heavy Machinery A needs to understand the core reasons impacting the Misc. Capital Goods industry. This will help it in building a better workplace.

Regulatory challenges

– Wuxi Huadong Heavy Machinery A needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Misc. Capital Goods industry regulations.

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Weighted SWOT Analysis of Wuxi Huadong Heavy Machinery A Template, Example

Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Wuxi Huadong Heavy Machinery A 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 Wuxi Huadong Heavy Machinery A 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 Wuxi Huadong Heavy Machinery A 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 Wuxi Huadong Heavy Machinery A 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 Wuxi Huadong Heavy Machinery A needs to make to build a sustainable competitive advantage.

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