SWOT Analysis / TOWS Matrix for Gem-Year Industrial (China)
Based on various researches at Oak Spring University , Gem-Year Industrial is operating in a macro-environment that has been destablized by – customer relationship management is fast transforming because of increasing concerns over data privacy, geopolitical disruptions, increasing household debt because of falling income levels, increasing commodity prices, challanges to central banks by blockchain based private currencies, increasing energy prices, central banks are concerned over increasing inflation,
there is increasing trade war between United States & China, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of Gem-Year Industrial
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Gem-Year Industrial can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Gem-Year Industrial, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Gem-Year Industrial 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 Gem-Year Industrial can be done for the following purposes –
1. Strategic planning of Gem-Year Industrial
2. Improving business portfolio management of Gem-Year Industrial
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 Gem-Year Industrial
Strengths of Gem-Year Industrial | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Gem-Year Industrial are -
Ability to recruit top talent
– Gem-Year Industrial is one of the leading players in the Misc. Fabricated Products 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.
Sustainable margins compare to other players in Misc. Fabricated Products industry
– Gem-Year Industrial has clearly differentiated products in the market place. This has enabled Gem-Year Industrial to fetch slight price premium compare to the competitors in the Misc. Fabricated Products industry. The sustainable margins have also helped Gem-Year Industrial to invest into research and development (R&D) and innovation.
Training and development
– Gem-Year Industrial 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.
Strong track record of project management in the Misc. Fabricated Products industry
– Gem-Year Industrial is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Highly skilled collaborators
– Gem-Year Industrial 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 Gem-Year Industrial have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to lead change in Misc. Fabricated Products
– Gem-Year Industrial 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 Gem-Year Industrial in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Successful track record of launching new products
– Gem-Year Industrial has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Gem-Year Industrial 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.
Cross disciplinary teams
– Horizontal connected teams at the Gem-Year Industrial 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.
Low bargaining power of suppliers
– Suppliers of Gem-Year Industrial in the Basic Materials sector have low bargaining power. Gem-Year Industrial has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Gem-Year Industrial to manage not only supply disruptions but also source products at highly competitive prices.
Analytics focus
– Gem-Year Industrial 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.
Innovation driven organization
– Gem-Year Industrial is one of the most innovative firm in Misc. Fabricated Products sector.
Learning organization
- Gem-Year Industrial 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 Gem-Year Industrial is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Gem-Year Industrial emphasize – knowledge, initiative, and innovation.
Weaknesses of Gem-Year Industrial | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Gem-Year Industrial are -
Interest costs
– Compare to the competition, Gem-Year Industrial 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.
Need for greater diversity
– Gem-Year Industrial 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. Fabricated Products industry, Gem-Year Industrial 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.
Compensation and incentives
– The revenue per employee of Gem-Year Industrial is just above the Misc. Fabricated Products 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 operating costs
– Compare to the competitors, Gem-Year Industrial 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 Gem-Year Industrial lucrative customers.
Increasing silos among functional specialists
– The organizational structure of Gem-Year Industrial is dominated by functional specialists. It is not different from other players in the Misc. Fabricated Products industry, but Gem-Year Industrial needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Gem-Year Industrial to focus more on services in the Misc. Fabricated Products industry rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As Gem-Year Industrial is one of the leading players in the Misc. Fabricated Products industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Misc. Fabricated Products industry in last five years.
Skills based hiring in Misc. Fabricated Products industry
– The stress on hiring functional specialists at Gem-Year Industrial 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.
Employees’ less understanding of Gem-Year Industrial strategy
– From the outside it seems that the employees of Gem-Year Industrial 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.
High cash cycle compare to competitors
Gem-Year Industrial 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.
Products dominated business model
– Even though Gem-Year Industrial 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. Gem-Year Industrial should strive to include more intangible value offerings along with its core products and services.
Gem-Year Industrial Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Gem-Year Industrial are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Gem-Year Industrial 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.
Using analytics as competitive advantage
– Gem-Year Industrial has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Misc. Fabricated Products sector. This continuous investment in analytics has enabled Gem-Year Industrial to build a competitive advantage using analytics. The analytics driven competitive advantage can help Gem-Year Industrial to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Low interest rates
– Even though inflation is raising its head in most developed economies, Gem-Year Industrial 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.
Leveraging digital technologies
– Gem-Year Industrial 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.
Creating value in data economy
– The success of analytics program of Gem-Year Industrial has opened avenues for new revenue streams for the organization in Misc. Fabricated Products industry. This can help Gem-Year Industrial to build a more holistic ecosystem for Gem-Year Industrial products in the Misc. Fabricated Products industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at Gem-Year Industrial 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Gem-Year Industrial 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 Gem-Year Industrial to hire the very best people irrespective of their geographical location.
Loyalty marketing
– Gem-Year Industrial 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 Gem-Year Industrial 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Gem-Year Industrial is facing challenges because of the dominance of functional experts in the organization. Gem-Year Industrial 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.
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. Gem-Year Industrial can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Learning at scale
– Online learning technologies has now opened space for Gem-Year Industrial 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.
Developing new processes and practices
– Gem-Year Industrial can develop new processes and procedures in Misc. Fabricated Products 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.
Threats Gem-Year Industrial External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Gem-Year Industrial are -
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 Gem-Year Industrial in the Misc. Fabricated Products sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Gem-Year Industrial 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Misc. Fabricated Products industry are lowering. It can presents Gem-Year Industrial 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.
Consumer confidence and its impact on Gem-Year Industrial 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.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Regulatory challenges
– Gem-Year Industrial 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.
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. Gem-Year Industrial 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.
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.
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. Gem-Year Industrial can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Gem-Year Industrial needs to understand the core reasons impacting the Misc. Fabricated Products industry. This will help it in building a better workplace.
Increasing wage structure of Gem-Year Industrial
– 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 Gem-Year Industrial.
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 Gem-Year Industrial business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Gem-Year Industrial 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.
Weighted SWOT Analysis of Gem-Year Industrial Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Gem-Year Industrial 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 Gem-Year Industrial 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 Gem-Year Industrial 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 Gem-Year Industrial 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 Gem-Year Industrial needs to make to build a sustainable competitive advantage.