Cnnc Hua Yuan A (2145) SWOT Analysis / TOWS Matrix / MBA Resources
Chemical Manufacturing
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Cnnc Hua Yuan A (China)
Based on various researches at Oak Spring University , Cnnc Hua Yuan A is operating in a macro-environment that has been destablized by – wage bills are increasing, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing household debt because of falling income levels, challanges to central banks by blockchain based private currencies, cloud computing is disrupting traditional business models, there is increasing trade war between United States & China, increasing transportation and logistics costs,
digital marketing is dominated by two big players Facebook and Google, increasing government debt because of Covid-19 spendings, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Cnnc Hua Yuan A can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Cnnc Hua Yuan A, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Cnnc Hua Yuan 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.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Cnnc Hua Yuan A can be done for the following purposes –
1. Strategic planning of Cnnc Hua Yuan A
2. Improving business portfolio management of Cnnc Hua Yuan A
3. Assessing feasibility of the new initiative in China
4. Making a Chemical Manufacturing sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Cnnc Hua Yuan A
Strengths of Cnnc Hua Yuan A | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Cnnc Hua Yuan A are -
Analytics focus
– Cnnc Hua Yuan 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 Chemical Manufacturing 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.
Low bargaining power of suppliers
– Suppliers of Cnnc Hua Yuan A in the Basic Materials sector have low bargaining power. Cnnc Hua Yuan A has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Cnnc Hua Yuan A to manage not only supply disruptions but also source products at highly competitive prices.
Sustainable margins compare to other players in Chemical Manufacturing industry
– Cnnc Hua Yuan A has clearly differentiated products in the market place. This has enabled Cnnc Hua Yuan A to fetch slight price premium compare to the competitors in the Chemical Manufacturing industry. The sustainable margins have also helped Cnnc Hua Yuan A to invest into research and development (R&D) and innovation.
Effective Research and Development (R&D)
– Cnnc Hua Yuan A has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Cnnc Hua Yuan A staying ahead in the Chemical Manufacturing industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Diverse revenue streams
– Cnnc Hua Yuan A is present in almost all the verticals within the Chemical Manufacturing industry. This has provided Cnnc Hua Yuan 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 switching costs
– The high switching costs that Cnnc Hua Yuan A 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 Cnnc Hua Yuan A in Chemical Manufacturing industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– Cnnc Hua Yuan A 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.
Learning organization
- Cnnc Hua Yuan A 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 Cnnc Hua Yuan A is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Cnnc Hua Yuan A emphasize – knowledge, initiative, and innovation.
Organizational Resilience of Cnnc Hua Yuan A
– The covid-19 pandemic has put organizational resilience at the centre of everthing Cnnc Hua Yuan A does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Innovation driven organization
– Cnnc Hua Yuan A is one of the most innovative firm in Chemical Manufacturing sector.
Ability to lead change in Chemical Manufacturing
– Cnnc Hua Yuan A is one of the leading players in the Chemical Manufacturing industry in China. Over the years it has not only transformed the business landscape in the Chemical Manufacturing industry in China but also across the existing markets. The ability to lead change has enabled Cnnc Hua Yuan A in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Weaknesses of Cnnc Hua Yuan A | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Cnnc Hua Yuan A are -
Employees’ less understanding of Cnnc Hua Yuan A strategy
– From the outside it seems that the employees of Cnnc Hua Yuan 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.
Increasing silos among functional specialists
– The organizational structure of Cnnc Hua Yuan A is dominated by functional specialists. It is not different from other players in the Chemical Manufacturing industry, but Cnnc Hua Yuan A needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Cnnc Hua Yuan A to focus more on services in the Chemical Manufacturing industry rather than just following the product oriented approach.
Interest costs
– Compare to the competition, Cnnc Hua Yuan A 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.
Capital Spending Reduction
– Even during the low interest decade, Cnnc Hua Yuan A 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 Chemical Manufacturing industry using digital technology.
Lack of clear differentiation of Cnnc Hua Yuan A products
– To increase the profitability and margins on the products, Cnnc Hua Yuan A needs to provide more differentiated products than what it is currently offering in the marketplace.
Compensation and incentives
– The revenue per employee of Cnnc Hua Yuan A is just above the Chemical Manufacturing industry average. It needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
High dependence on Cnnc Hua Yuan A ‘s star products
– The top 2 products and services of Cnnc Hua Yuan A still accounts for major business revenue. This dependence on star products in Chemical Manufacturing industry has resulted into insufficient focus on developing new products, even though Cnnc Hua Yuan A has relatively successful track record of launching new products.
Low market penetration in new markets
– Outside its home market of China, Cnnc Hua Yuan A needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Products dominated business model
– Even though Cnnc Hua Yuan A has some of the most successful models in the Chemical Manufacturing industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Cnnc Hua Yuan A should strive to include more intangible value offerings along with its core products and services.
Skills based hiring in Chemical Manufacturing industry
– The stress on hiring functional specialists at Cnnc Hua Yuan A 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, Cnnc Hua Yuan A is slow explore the new channels of communication. These new channels of communication can help Cnnc Hua Yuan A to provide better information regarding Chemical Manufacturing products and services. It can also build an online community to further reach out to potential customers.
Cnnc Hua Yuan A Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Cnnc Hua Yuan A are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Cnnc Hua Yuan A is facing challenges because of the dominance of functional experts in the organization. Cnnc Hua Yuan A can utilize new technology in the field of Chemical Manufacturing industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Leveraging digital technologies
– Cnnc Hua Yuan A 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.
Learning at scale
– Online learning technologies has now opened space for Cnnc Hua Yuan A 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Cnnc Hua Yuan A can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Use of Bitcoin and other crypto currencies for transactions in Chemical Manufacturing industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Cnnc Hua Yuan A in the Chemical Manufacturing industry. Now Cnnc Hua Yuan A can target international markets with far fewer capital restrictions requirements than the existing system.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Cnnc Hua Yuan A can use these opportunities to build new business models that can help the communities that Cnnc Hua Yuan A operates in. Secondly it can use opportunities from government spending in Chemical Manufacturing 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. Cnnc Hua Yuan A 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 Chemical Manufacturing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Cnnc Hua Yuan A 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. Cnnc Hua Yuan A 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Cnnc Hua Yuan A 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 Cnnc Hua Yuan A to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Loyalty marketing
– Cnnc Hua Yuan 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Chemical Manufacturing industry, but it has also influenced the consumer preferences. Cnnc Hua Yuan A can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Developing new processes and practices
– Cnnc Hua Yuan A can develop new processes and procedures in Chemical Manufacturing 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Cnnc Hua Yuan 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 Chemical Manufacturing industry, and it will provide faster access to the consumers.
Threats Cnnc Hua Yuan A External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Cnnc Hua Yuan A are -
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. Cnnc Hua Yuan A will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Cnnc Hua Yuan 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 Chemical Manufacturing sector.
Stagnating economy with rate increase
– Cnnc Hua Yuan 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 Chemical Manufacturing industry.
Consumer confidence and its impact on Cnnc Hua Yuan 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 Chemical Manufacturing industry and other sectors.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Cnnc Hua Yuan A 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 Cnnc Hua Yuan A prominent markets.
Shortening product life cycle
– it is one of the major threat that Cnnc Hua Yuan A is facing in Chemical Manufacturing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Chemical Manufacturing industry are lowering. It can presents Cnnc Hua Yuan A with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Chemical Manufacturing 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 Cnnc Hua Yuan A.
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. Cnnc Hua Yuan A needs to understand the core reasons impacting the Chemical Manufacturing industry. This will help it in building a better workplace.
Easy access to finance
– Easy access to finance in Chemical Manufacturing industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Cnnc Hua Yuan A 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 Cnnc Hua Yuan 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 Cnnc Hua Yuan A.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Cnnc Hua Yuan A in Chemical Manufacturing industry. The Chemical Manufacturing 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.
Weighted SWOT Analysis of Cnnc Hua Yuan A Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Cnnc Hua Yuan 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 Cnnc Hua Yuan 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 Cnnc Hua Yuan 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 Cnnc Hua Yuan 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 Cnnc Hua Yuan A needs to make to build a sustainable competitive advantage.