SWOT Analysis / TOWS Matrix for Anhui Xinlong Electrical (China)
Based on various researches at Oak Spring University , Anhui Xinlong Electrical is operating in a macro-environment that has been destablized by – there is backlash against globalization, wage bills are increasing, technology disruption, increasing household debt because of falling income levels, there is increasing trade war between United States & China, challanges to central banks by blockchain based private currencies, customer relationship management is fast transforming because of increasing concerns over data privacy,
increasing inequality as vast percentage of new income is going to the top 1%, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Anhui Xinlong Electrical
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Anhui Xinlong Electrical can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Anhui Xinlong Electrical, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Anhui Xinlong Electrical 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 Anhui Xinlong Electrical can be done for the following purposes –
1. Strategic planning of Anhui Xinlong Electrical
2. Improving business portfolio management of Anhui Xinlong Electrical
3. Assessing feasibility of the new initiative in China
4. Making a Electronic Instr. & Controls sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Anhui Xinlong Electrical
Strengths of Anhui Xinlong Electrical | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Anhui Xinlong Electrical are -
Organizational Resilience of Anhui Xinlong Electrical
– The covid-19 pandemic has put organizational resilience at the centre of everthing Anhui Xinlong Electrical 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 Anhui Xinlong Electrical in Electronic Instr. & Controls industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Successful track record of launching new products
– Anhui Xinlong Electrical has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Anhui Xinlong Electrical 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.
Learning organization
- Anhui Xinlong Electrical 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 Anhui Xinlong Electrical is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Anhui Xinlong Electrical emphasize – knowledge, initiative, and innovation.
Highly skilled collaborators
– Anhui Xinlong Electrical has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Electronic Instr. & Controls industry. Secondly the value chain collaborators of Anhui Xinlong Electrical have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to lead change in Electronic Instr. & Controls
– Anhui Xinlong Electrical is one of the leading players in the Electronic Instr. & Controls industry in China. Over the years it has not only transformed the business landscape in the Electronic Instr. & Controls industry in China but also across the existing markets. The ability to lead change has enabled Anhui Xinlong Electrical in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Innovation driven organization
– Anhui Xinlong Electrical is one of the most innovative firm in Electronic Instr. & Controls sector.
Diverse revenue streams
– Anhui Xinlong Electrical is present in almost all the verticals within the Electronic Instr. & Controls industry. This has provided Anhui Xinlong Electrical 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.
Effective Research and Development (R&D)
– Anhui Xinlong Electrical has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Anhui Xinlong Electrical staying ahead in the Electronic Instr. & Controls industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Operational resilience
– The operational resilience strategy of Anhui Xinlong Electrical comprises – understanding the underlying the factors in the Electronic Instr. & Controls 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.
Cross disciplinary teams
– Horizontal connected teams at the Anhui Xinlong Electrical 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.
Training and development
– Anhui Xinlong Electrical has one of the best training and development program in Technology 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.
Weaknesses of Anhui Xinlong Electrical | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Anhui Xinlong Electrical are -
High dependence on Anhui Xinlong Electrical ‘s star products
– The top 2 products and services of Anhui Xinlong Electrical still accounts for major business revenue. This dependence on star products in Electronic Instr. & Controls industry has resulted into insufficient focus on developing new products, even though Anhui Xinlong Electrical has relatively successful track record of launching new products.
Slow to strategic competitive environment developments
– As Anhui Xinlong Electrical is one of the leading players in the Electronic Instr. & Controls industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Electronic Instr. & Controls industry in last five years.
High operating costs
– Compare to the competitors, Anhui Xinlong Electrical has high operating costs in the Electronic Instr. & Controls industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Anhui Xinlong Electrical lucrative customers.
Lack of clear differentiation of Anhui Xinlong Electrical products
– To increase the profitability and margins on the products, Anhui Xinlong Electrical needs to provide more differentiated products than what it is currently offering in the marketplace.
Skills based hiring in Electronic Instr. & Controls industry
– The stress on hiring functional specialists at Anhui Xinlong Electrical 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 decision making process
– As mentioned earlier in the report, Anhui Xinlong Electrical has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Electronic Instr. & Controls industry over the last five years. Anhui Xinlong Electrical 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.
Workers concerns about automation
– As automation is fast increasing in the Electronic Instr. & Controls industry, Anhui Xinlong Electrical 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.
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 Anhui Xinlong Electrical supply chain. Even after few cautionary changes, Anhui Xinlong Electrical is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Anhui Xinlong Electrical vulnerable to further global disruptions in South East Asia.
Low market penetration in new markets
– Outside its home market of China, Anhui Xinlong Electrical needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Anhui Xinlong Electrical is slow explore the new channels of communication. These new channels of communication can help Anhui Xinlong Electrical to provide better information regarding Electronic Instr. & Controls products and services. It can also build an online community to further reach out to potential customers.
No frontier risks strategy
– From the 10K / annual statement of Anhui Xinlong Electrical, it seems that company is thinking out the frontier risks that can impact Electronic Instr. & Controls 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.
Anhui Xinlong Electrical Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Anhui Xinlong Electrical are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Anhui Xinlong Electrical can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Using analytics as competitive advantage
– Anhui Xinlong Electrical has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Electronic Instr. & Controls sector. This continuous investment in analytics has enabled Anhui Xinlong Electrical to build a competitive advantage using analytics. The analytics driven competitive advantage can help Anhui Xinlong Electrical to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Learning at scale
– Online learning technologies has now opened space for Anhui Xinlong Electrical 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Anhui Xinlong Electrical can use these opportunities to build new business models that can help the communities that Anhui Xinlong Electrical operates in. Secondly it can use opportunities from government spending in Electronic Instr. & Controls sector.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Anhui Xinlong Electrical in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Electronic Instr. & Controls industry, and it will provide faster access to the consumers.
Developing new processes and practices
– Anhui Xinlong Electrical can develop new processes and procedures in Electronic Instr. & Controls 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.
Use of Bitcoin and other crypto currencies for transactions in Electronic Instr. & Controls industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Anhui Xinlong Electrical in the Electronic Instr. & Controls industry. Now Anhui Xinlong Electrical can target international markets with far fewer capital restrictions requirements than the existing system.
Manufacturing automation
– Anhui Xinlong Electrical can use the latest technology developments to improve its manufacturing and designing process in Electronic Instr. & Controls 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.
Creating value in data economy
– The success of analytics program of Anhui Xinlong Electrical has opened avenues for new revenue streams for the organization in Electronic Instr. & Controls industry. This can help Anhui Xinlong Electrical to build a more holistic ecosystem for Anhui Xinlong Electrical products in the Electronic Instr. & Controls 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, Anhui Xinlong Electrical 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.
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 Anhui Xinlong Electrical 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.
Leveraging digital technologies
– Anhui Xinlong Electrical 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.
Buying journey improvements
– Anhui Xinlong Electrical can improve the customer journey of consumers in the Electronic Instr. & Controls 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.
Threats Anhui Xinlong Electrical External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Anhui Xinlong Electrical are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Anhui Xinlong Electrical may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Electronic Instr. & Controls sector.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Regulatory challenges
– Anhui Xinlong Electrical 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 Electronic Instr. & Controls industry regulations.
Technology acceleration in Forth Industrial Revolution
– Anhui Xinlong Electrical has witnessed rapid integration of technology during Covid-19 in the Electronic Instr. & Controls industry. As one of the leading players in the industry, Anhui Xinlong Electrical needs to keep up with the evolution of technology in the Electronic Instr. & Controls 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.
Easy access to finance
– Easy access to finance in Electronic Instr. & Controls industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Anhui Xinlong Electrical can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Anhui Xinlong Electrical 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 Anhui Xinlong Electrical prominent markets.
High dependence on third party suppliers
– Anhui Xinlong Electrical 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 Anhui Xinlong Electrical is facing in Electronic Instr. & Controls sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Environmental challenges
– Anhui Xinlong Electrical 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. Anhui Xinlong Electrical can take advantage of this fund but it will also bring new competitors in the Electronic Instr. & Controls industry.
Stagnating economy with rate increase
– Anhui Xinlong Electrical 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 Electronic Instr. & Controls industry.
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. Anhui Xinlong Electrical 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.
Consumer confidence and its impact on Anhui Xinlong Electrical 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 Electronic Instr. & Controls industry and other sectors.
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 Anhui Xinlong Electrical business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of Anhui Xinlong Electrical Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Anhui Xinlong Electrical 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 Anhui Xinlong Electrical 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 Anhui Xinlong Electrical 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 Anhui Xinlong Electrical 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 Anhui Xinlong Electrical needs to make to build a sustainable competitive advantage.