Based on various researches at Oak Spring University , Beijing Emerging Eastern Aviation is operating in a macro-environment that has been destablized by – geopolitical disruptions, wage bills are increasing, increasing transportation and logistics costs, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing energy prices, there is backlash against globalization, central banks are concerned over increasing inflation,
digital marketing is dominated by two big players Facebook and Google, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of Beijing Emerging Eastern Aviation
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Beijing Emerging Eastern Aviation can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Beijing Emerging Eastern Aviation, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Beijing Emerging Eastern Aviation operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Beijing Emerging Eastern Aviation can be done for the following purposes –
1. Strategic planning of Beijing Emerging Eastern Aviation
2. Improving business portfolio management of Beijing Emerging Eastern Aviation
3. Assessing feasibility of the new initiative in China
4. Making a Aerospace & Defense sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Beijing Emerging Eastern Aviation
Strengths of Beijing Emerging Eastern Aviation | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Beijing Emerging Eastern Aviation are -
Digital Transformation in Aerospace & Defense industry
- digital transformation varies from industry to industry. For Beijing Emerging Eastern Aviation digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Beijing Emerging Eastern Aviation 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.
Superior customer experience
– The customer experience strategy of Beijing Emerging Eastern Aviation in Aerospace & Defense industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High switching costs
– The high switching costs that Beijing Emerging Eastern Aviation 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.
Diverse revenue streams
– Beijing Emerging Eastern Aviation is present in almost all the verticals within the Aerospace & Defense industry. This has provided Beijing Emerging Eastern Aviation 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.
Analytics focus
– Beijing Emerging Eastern Aviation 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 Aerospace & Defense 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.
Learning organization
- Beijing Emerging Eastern Aviation 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 Beijing Emerging Eastern Aviation is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Beijing Emerging Eastern Aviation emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in Aerospace & Defense industry
– Beijing Emerging Eastern Aviation has clearly differentiated products in the market place. This has enabled Beijing Emerging Eastern Aviation to fetch slight price premium compare to the competitors in the Aerospace & Defense industry. The sustainable margins have also helped Beijing Emerging Eastern Aviation to invest into research and development (R&D) and innovation.
Organizational Resilience of Beijing Emerging Eastern Aviation
– The covid-19 pandemic has put organizational resilience at the centre of everthing Beijing Emerging Eastern Aviation does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Highly skilled collaborators
– Beijing Emerging Eastern Aviation has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Aerospace & Defense industry. Secondly the value chain collaborators of Beijing Emerging Eastern Aviation have helped the firm to develop new products and bring them quickly to the marketplace.
Low bargaining power of suppliers
– Suppliers of Beijing Emerging Eastern Aviation in the Capital Goods sector have low bargaining power. Beijing Emerging Eastern Aviation has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Beijing Emerging Eastern Aviation to manage not only supply disruptions but also source products at highly competitive prices.
Ability to recruit top talent
– Beijing Emerging Eastern Aviation is one of the leading players in the Aerospace & Defense 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.
High brand equity
– Beijing Emerging Eastern Aviation has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Beijing Emerging Eastern Aviation to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses of Beijing Emerging Eastern Aviation | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Beijing Emerging Eastern Aviation are -
Low market penetration in new markets
– Outside its home market of China, Beijing Emerging Eastern Aviation needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Workers concerns about automation
– As automation is fast increasing in the Aerospace & Defense industry, Beijing Emerging Eastern Aviation 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.
Ability to respond to the competition
– As the decision making is very deliberative at Beijing Emerging Eastern Aviation, in the dynamic environment of Aerospace & Defense industry it has struggled to respond to the nimble upstart competition. Beijing Emerging Eastern Aviation has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
No frontier risks strategy
– From the 10K / annual statement of Beijing Emerging Eastern Aviation, it seems that company is thinking out the frontier risks that can impact Aerospace & Defense 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.
Increasing silos among functional specialists
– The organizational structure of Beijing Emerging Eastern Aviation is dominated by functional specialists. It is not different from other players in the Aerospace & Defense industry, but Beijing Emerging Eastern Aviation needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Beijing Emerging Eastern Aviation to focus more on services in the Aerospace & Defense industry rather than just following the product oriented approach.
Need for greater diversity
– Beijing Emerging Eastern Aviation 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.
High cash cycle compare to competitors
Beijing Emerging Eastern Aviation has a high cash cycle compare to other players in the Aerospace & Defense industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Capital Spending Reduction
– Even during the low interest decade, Beijing Emerging Eastern Aviation 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 Aerospace & Defense industry using digital technology.
Slow decision making process
– As mentioned earlier in the report, Beijing Emerging Eastern Aviation has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Aerospace & Defense industry over the last five years. Beijing Emerging Eastern Aviation 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.
High bargaining power of channel partners in Aerospace & Defense industry
– because of the regulatory requirements in China, Beijing Emerging Eastern Aviation is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the Aerospace & Defense industry.
High operating costs
– Compare to the competitors, Beijing Emerging Eastern Aviation has high operating costs in the Aerospace & Defense industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Beijing Emerging Eastern Aviation lucrative customers.
Beijing Emerging Eastern Aviation Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Beijing Emerging Eastern Aviation are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Beijing Emerging Eastern Aviation in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Aerospace & Defense industry, and it will provide faster access to the consumers.
Low interest rates
– Even though inflation is raising its head in most developed economies, Beijing Emerging Eastern Aviation 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Aerospace & Defense industry, but it has also influenced the consumer preferences. Beijing Emerging Eastern Aviation can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Loyalty marketing
– Beijing Emerging Eastern Aviation 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.
Learning at scale
– Online learning technologies has now opened space for Beijing Emerging Eastern Aviation 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.
Leveraging digital technologies
– Beijing Emerging Eastern Aviation 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.
Developing new processes and practices
– Beijing Emerging Eastern Aviation can develop new processes and procedures in Aerospace & Defense 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Beijing Emerging Eastern Aviation can use these opportunities to build new business models that can help the communities that Beijing Emerging Eastern Aviation operates in. Secondly it can use opportunities from government spending in Aerospace & Defense sector.
Building a culture of innovation
– managers at Beijing Emerging Eastern Aviation 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 Aerospace & Defense industry.
Buying journey improvements
– Beijing Emerging Eastern Aviation can improve the customer journey of consumers in the Aerospace & Defense 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.
Use of Bitcoin and other crypto currencies for transactions in Aerospace & Defense industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Beijing Emerging Eastern Aviation in the Aerospace & Defense industry. Now Beijing Emerging Eastern Aviation can target international markets with far fewer capital restrictions requirements than the existing system.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Beijing Emerging Eastern Aviation 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 Beijing Emerging Eastern Aviation to hire the very best people irrespective of their geographical location.
Using analytics as competitive advantage
– Beijing Emerging Eastern Aviation has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Aerospace & Defense sector. This continuous investment in analytics has enabled Beijing Emerging Eastern Aviation to build a competitive advantage using analytics. The analytics driven competitive advantage can help Beijing Emerging Eastern Aviation to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Beijing Emerging Eastern Aviation External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Beijing Emerging Eastern Aviation 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. Beijing Emerging Eastern Aviation 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, Beijing Emerging Eastern Aviation may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Aerospace & Defense sector.
Stagnating economy with rate increase
– Beijing Emerging Eastern Aviation 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 Aerospace & Defense industry.
Regulatory challenges
– Beijing Emerging Eastern Aviation 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 Aerospace & Defense industry regulations.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Beijing Emerging Eastern Aviation needs to understand the core reasons impacting the Aerospace & Defense industry. This will help it in building a better workplace.
High dependence on third party suppliers
– Beijing Emerging Eastern Aviation 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Beijing Emerging Eastern Aviation in Aerospace & Defense industry. The Aerospace & Defense 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.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Beijing Emerging Eastern Aviation.
Easy access to finance
– Easy access to finance in Aerospace & Defense industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Beijing Emerging Eastern Aviation can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Technology acceleration in Forth Industrial Revolution
– Beijing Emerging Eastern Aviation has witnessed rapid integration of technology during Covid-19 in the Aerospace & Defense industry. As one of the leading players in the industry, Beijing Emerging Eastern Aviation needs to keep up with the evolution of technology in the Aerospace & Defense 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.
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.
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 Beijing Emerging Eastern Aviation 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 Aerospace & Defense industry are lowering. It can presents Beijing Emerging Eastern Aviation with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Aerospace & Defense sector.
Weighted SWOT Analysis of Beijing Emerging Eastern Aviation Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Beijing Emerging Eastern Aviation needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of Beijing Emerging Eastern Aviation is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of Beijing Emerging Eastern Aviation is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Beijing Emerging Eastern Aviation to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Beijing Emerging Eastern Aviation needs to make to build a sustainable competitive advantage.