Yongxing Special Stainless Steel (2756) SWOT Analysis / TOWS Matrix / MBA Resources
Misc. Fabricated Products
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Yongxing Special Stainless Steel (China)
Based on various researches at Oak Spring University , Yongxing Special Stainless Steel is operating in a macro-environment that has been destablized by – talent flight as more people leaving formal jobs, supply chains are disrupted by pandemic , there is increasing trade war between United States & China, customer relationship management is fast transforming because of increasing concerns over data privacy, geopolitical disruptions, increasing commodity prices, increasing transportation and logistics costs,
technology disruption, there is backlash against globalization, etc
Introduction to SWOT Analysis of Yongxing Special Stainless Steel
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Yongxing Special Stainless Steel can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Yongxing Special Stainless Steel, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Yongxing Special Stainless Steel 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 Yongxing Special Stainless Steel can be done for the following purposes –
1. Strategic planning of Yongxing Special Stainless Steel
2. Improving business portfolio management of Yongxing Special Stainless Steel
3. Assessing feasibility of the new initiative in China
4. Making a Misc. Fabricated Products sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Yongxing Special Stainless Steel
Strengths of Yongxing Special Stainless Steel | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Yongxing Special Stainless Steel are -
Organizational Resilience of Yongxing Special Stainless Steel
– The covid-19 pandemic has put organizational resilience at the centre of everthing Yongxing Special Stainless Steel does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Superior customer experience
– The customer experience strategy of Yongxing Special Stainless Steel in Misc. Fabricated Products industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Innovation driven organization
– Yongxing Special Stainless Steel is one of the most innovative firm in Misc. Fabricated Products sector.
Highly skilled collaborators
– Yongxing Special Stainless Steel has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Misc. Fabricated Products industry. Secondly the value chain collaborators of Yongxing Special Stainless Steel have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– Yongxing Special Stainless Steel has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Yongxing Special Stainless Steel 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.
Analytics focus
– Yongxing Special Stainless Steel 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. Fabricated Products 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.
Sustainable margins compare to other players in Misc. Fabricated Products industry
– Yongxing Special Stainless Steel has clearly differentiated products in the market place. This has enabled Yongxing Special Stainless Steel to fetch slight price premium compare to the competitors in the Misc. Fabricated Products industry. The sustainable margins have also helped Yongxing Special Stainless Steel to invest into research and development (R&D) and innovation.
High switching costs
– The high switching costs that Yongxing Special Stainless Steel 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.
Strong track record of project management in the Misc. Fabricated Products industry
– Yongxing Special Stainless Steel is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to lead change in Misc. Fabricated Products
– Yongxing Special Stainless Steel is one of the leading players in the Misc. Fabricated Products industry in China. Over the years it has not only transformed the business landscape in the Misc. Fabricated Products industry in China but also across the existing markets. The ability to lead change has enabled Yongxing Special Stainless Steel in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Digital Transformation in Misc. Fabricated Products industry
- digital transformation varies from industry to industry. For Yongxing Special Stainless Steel digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Yongxing Special Stainless Steel 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.
Operational resilience
– The operational resilience strategy of Yongxing Special Stainless Steel comprises – understanding the underlying the factors in the Misc. Fabricated Products industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Weaknesses of Yongxing Special Stainless Steel | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Yongxing Special Stainless Steel are -
Slow decision making process
– As mentioned earlier in the report, Yongxing Special Stainless Steel 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. Fabricated Products industry over the last five years. Yongxing Special Stainless Steel 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.
Need for greater diversity
– Yongxing Special Stainless Steel 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 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 Yongxing Special Stainless Steel supply chain. Even after few cautionary changes, Yongxing Special Stainless Steel is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Yongxing Special Stainless Steel vulnerable to further global disruptions in South East Asia.
High cash cycle compare to competitors
Yongxing Special Stainless Steel has a high cash cycle compare to other players in the Misc. Fabricated Products industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Skills based hiring in Misc. Fabricated Products industry
– The stress on hiring functional specialists at Yongxing Special Stainless Steel 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.
Lack of clear differentiation of Yongxing Special Stainless Steel products
– To increase the profitability and margins on the products, Yongxing Special Stainless Steel needs to provide more differentiated products than what it is currently offering in the marketplace.
High operating costs
– Compare to the competitors, Yongxing Special Stainless Steel has high operating costs in the Misc. Fabricated Products industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Yongxing Special Stainless Steel lucrative customers.
High dependence on Yongxing Special Stainless Steel ‘s star products
– The top 2 products and services of Yongxing Special Stainless Steel still accounts for major business revenue. This dependence on star products in Misc. Fabricated Products industry has resulted into insufficient focus on developing new products, even though Yongxing Special Stainless Steel has relatively successful track record of launching new products.
Low market penetration in new markets
– Outside its home market of China, Yongxing Special Stainless Steel needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Products dominated business model
– Even though Yongxing Special Stainless Steel has some of the most successful models in the Misc. Fabricated Products industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Yongxing Special Stainless Steel should strive to include more intangible value offerings along with its core products and services.
Aligning sales with marketing
– From the outside it seems that Yongxing Special Stainless Steel needs to have more collaboration between its sales team and marketing team. Sales professionals in the Misc. Fabricated Products industry have deep experience in developing customer relationships. Marketing department at Yongxing Special Stainless Steel can leverage the sales team experience to cultivate customer relationships as Yongxing Special Stainless Steel is planning to shift buying processes online.
Yongxing Special Stainless Steel Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Yongxing Special Stainless Steel are -
Building a culture of innovation
– managers at Yongxing Special Stainless Steel 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 Misc. Fabricated Products industry.
Learning at scale
– Online learning technologies has now opened space for Yongxing Special Stainless Steel 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 Yongxing Special Stainless Steel 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 Yongxing Special Stainless Steel 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. Fabricated Products industry, and it will provide faster access to the consumers.
Better consumer reach
– The expansion of the 5G network will help Yongxing Special Stainless Steel to increase its market reach. Yongxing Special Stainless Steel 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.
Use of Bitcoin and other crypto currencies for transactions in Misc. Fabricated Products industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Yongxing Special Stainless Steel in the Misc. Fabricated Products industry. Now Yongxing Special Stainless Steel can target international markets with far fewer capital restrictions requirements than the existing system.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Misc. Fabricated Products industry, but it has also influenced the consumer preferences. Yongxing Special Stainless Steel can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Creating value in data economy
– The success of analytics program of Yongxing Special Stainless Steel has opened avenues for new revenue streams for the organization in Misc. Fabricated Products industry. This can help Yongxing Special Stainless Steel to build a more holistic ecosystem for Yongxing Special Stainless Steel products in the Misc. Fabricated Products industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Low interest rates
– Even though inflation is raising its head in most developed economies, Yongxing Special Stainless Steel 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Yongxing Special Stainless Steel is facing challenges because of the dominance of functional experts in the organization. Yongxing Special Stainless Steel can utilize new technology in the field of Misc. Fabricated Products industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Loyalty marketing
– Yongxing Special Stainless Steel 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.
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 Yongxing Special Stainless Steel 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.
Manufacturing automation
– Yongxing Special Stainless Steel can use the latest technology developments to improve its manufacturing and designing process in Misc. Fabricated Products 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.
Threats Yongxing Special Stainless Steel External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Yongxing Special Stainless Steel are -
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 Yongxing Special Stainless Steel business can come under increasing regulations regarding data privacy, data security, etc.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Yongxing Special Stainless Steel in the Misc. Fabricated Products sector and impact the bottomline of the organization.
Stagnating economy with rate increase
– Yongxing Special Stainless Steel 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. Fabricated Products industry.
Environmental challenges
– Yongxing Special Stainless Steel 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. Yongxing Special Stainless Steel can take advantage of this fund but it will also bring new competitors in the Misc. Fabricated Products industry.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Yongxing Special Stainless Steel in Misc. Fabricated Products industry. The Misc. Fabricated Products 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 Misc. Fabricated Products industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Yongxing Special Stainless Steel 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 Yongxing Special Stainless Steel
– 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 Yongxing Special Stainless Steel.
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 Yongxing Special Stainless Steel.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Misc. Fabricated Products industry are lowering. It can presents Yongxing Special Stainless Steel with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Misc. Fabricated Products sector.
Regulatory challenges
– Yongxing Special Stainless Steel 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. Fabricated Products industry regulations.
Consumer confidence and its impact on Yongxing Special Stainless Steel 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. Fabricated Products industry and other sectors.
High dependence on third party suppliers
– Yongxing Special Stainless Steel 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.
Shortening product life cycle
– it is one of the major threat that Yongxing Special Stainless Steel is facing in Misc. Fabricated Products sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Yongxing Special Stainless Steel Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Yongxing Special Stainless Steel 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 Yongxing Special Stainless Steel 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 Yongxing Special Stainless Steel 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 Yongxing Special Stainless Steel 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 Yongxing Special Stainless Steel needs to make to build a sustainable competitive advantage.