Based on various researches at Oak Spring University , Xiamen Jihong Package Tech is operating in a macro-environment that has been destablized by – increasing commodity prices, there is increasing trade war between United States & China, technology disruption, customer relationship management is fast transforming because of increasing concerns over data privacy, geopolitical disruptions, increasing inequality as vast percentage of new income is going to the top 1%, cloud computing is disrupting traditional business models,
banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of Xiamen Jihong Package Tech
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Xiamen Jihong Package Tech can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Xiamen Jihong Package Tech, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Xiamen Jihong Package Tech 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 Xiamen Jihong Package Tech can be done for the following purposes –
1. Strategic planning of Xiamen Jihong Package Tech
2. Improving business portfolio management of Xiamen Jihong Package Tech
3. Assessing feasibility of the new initiative in China
4. Making a Containers & Packaging sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Xiamen Jihong Package Tech
Strengths of Xiamen Jihong Package Tech | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Xiamen Jihong Package Tech are -
Highly skilled collaborators
– Xiamen Jihong Package Tech has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Containers & Packaging industry. Secondly the value chain collaborators of Xiamen Jihong Package Tech have helped the firm to develop new products and bring them quickly to the marketplace.
Training and development
– Xiamen Jihong Package Tech 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.
Organizational Resilience of Xiamen Jihong Package Tech
– The covid-19 pandemic has put organizational resilience at the centre of everthing Xiamen Jihong Package Tech does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Analytics focus
– Xiamen Jihong Package Tech 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 Containers & Packaging 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.
High brand equity
– Xiamen Jihong Package Tech has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Xiamen Jihong Package Tech to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to lead change in Containers & Packaging
– Xiamen Jihong Package Tech is one of the leading players in the Containers & Packaging industry in China. Over the years it has not only transformed the business landscape in the Containers & Packaging industry in China but also across the existing markets. The ability to lead change has enabled Xiamen Jihong Package Tech in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Diverse revenue streams
– Xiamen Jihong Package Tech is present in almost all the verticals within the Containers & Packaging industry. This has provided Xiamen Jihong Package Tech 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.
Sustainable margins compare to other players in Containers & Packaging industry
– Xiamen Jihong Package Tech has clearly differentiated products in the market place. This has enabled Xiamen Jihong Package Tech to fetch slight price premium compare to the competitors in the Containers & Packaging industry. The sustainable margins have also helped Xiamen Jihong Package Tech to invest into research and development (R&D) and innovation.
Ability to recruit top talent
– Xiamen Jihong Package Tech is one of the leading players in the Containers & Packaging 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.
Effective Research and Development (R&D)
– Xiamen Jihong Package Tech has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Xiamen Jihong Package Tech staying ahead in the Containers & Packaging industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Superior customer experience
– The customer experience strategy of Xiamen Jihong Package Tech in Containers & Packaging 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 Xiamen Jihong Package Tech 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.
Weaknesses of Xiamen Jihong Package Tech | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Xiamen Jihong Package Tech are -
Workers concerns about automation
– As automation is fast increasing in the Containers & Packaging industry, Xiamen Jihong Package Tech 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.
Low market penetration in new markets
– Outside its home market of China, Xiamen Jihong Package Tech needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Employees’ less understanding of Xiamen Jihong Package Tech strategy
– From the outside it seems that the employees of Xiamen Jihong Package Tech 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 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 Xiamen Jihong Package Tech supply chain. Even after few cautionary changes, Xiamen Jihong Package Tech is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Xiamen Jihong Package Tech vulnerable to further global disruptions in South East Asia.
High dependence on Xiamen Jihong Package Tech ‘s star products
– The top 2 products and services of Xiamen Jihong Package Tech still accounts for major business revenue. This dependence on star products in Containers & Packaging industry has resulted into insufficient focus on developing new products, even though Xiamen Jihong Package Tech has relatively successful track record of launching new products.
Lack of clear differentiation of Xiamen Jihong Package Tech products
– To increase the profitability and margins on the products, Xiamen Jihong Package Tech needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to strategic competitive environment developments
– As Xiamen Jihong Package Tech is one of the leading players in the Containers & Packaging industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Containers & Packaging industry in last five years.
Interest costs
– Compare to the competition, Xiamen Jihong Package Tech 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.
High cash cycle compare to competitors
Xiamen Jihong Package Tech has a high cash cycle compare to other players in the Containers & Packaging industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Need for greater diversity
– Xiamen Jihong Package Tech 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.
Capital Spending Reduction
– Even during the low interest decade, Xiamen Jihong Package Tech 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 Containers & Packaging industry using digital technology.
Xiamen Jihong Package Tech Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Xiamen Jihong Package Tech are -
Better consumer reach
– The expansion of the 5G network will help Xiamen Jihong Package Tech to increase its market reach. Xiamen Jihong Package Tech 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.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Xiamen Jihong Package Tech can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Xiamen Jihong Package Tech can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Developing new processes and practices
– Xiamen Jihong Package Tech can develop new processes and procedures in Containers & Packaging 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.
Manufacturing automation
– Xiamen Jihong Package Tech can use the latest technology developments to improve its manufacturing and designing process in Containers & Packaging 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Xiamen Jihong Package Tech 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 Xiamen Jihong Package Tech to hire the very best people irrespective of their geographical location.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Xiamen Jihong Package Tech is facing challenges because of the dominance of functional experts in the organization. Xiamen Jihong Package Tech can utilize new technology in the field of Containers & Packaging industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Use of Bitcoin and other crypto currencies for transactions in Containers & Packaging industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Xiamen Jihong Package Tech in the Containers & Packaging industry. Now Xiamen Jihong Package Tech can target international markets with far fewer capital restrictions requirements than the existing system.
Creating value in data economy
– The success of analytics program of Xiamen Jihong Package Tech has opened avenues for new revenue streams for the organization in Containers & Packaging industry. This can help Xiamen Jihong Package Tech to build a more holistic ecosystem for Xiamen Jihong Package Tech products in the Containers & Packaging industry by providing – data insight services, data privacy related products, data based consulting services, 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 Xiamen Jihong Package Tech 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.
Buying journey improvements
– Xiamen Jihong Package Tech can improve the customer journey of consumers in the Containers & Packaging 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.
Building a culture of innovation
– managers at Xiamen Jihong Package Tech 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 Containers & Packaging industry.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Xiamen Jihong Package Tech can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help Xiamen Jihong Package Tech to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Threats Xiamen Jihong Package Tech External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Xiamen Jihong Package Tech 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 Xiamen Jihong Package Tech in the Containers & Packaging sector and impact the bottomline of the organization.
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. Xiamen Jihong Package Tech needs to understand the core reasons impacting the Containers & Packaging industry. This will help it in building a better workplace.
Regulatory challenges
– Xiamen Jihong Package Tech 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 Containers & Packaging industry regulations.
Increasing wage structure of Xiamen Jihong Package Tech
– 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 Xiamen Jihong Package Tech.
Environmental challenges
– Xiamen Jihong Package Tech 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. Xiamen Jihong Package Tech can take advantage of this fund but it will also bring new competitors in the Containers & Packaging industry.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Xiamen Jihong Package Tech in Containers & Packaging industry. The Containers & Packaging 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 Containers & Packaging industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Xiamen Jihong Package Tech can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Stagnating economy with rate increase
– Xiamen Jihong Package Tech 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 Containers & Packaging industry.
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Xiamen Jihong Package Tech 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 Xiamen Jihong Package Tech prominent markets.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Containers & Packaging industry are lowering. It can presents Xiamen Jihong Package Tech with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Containers & Packaging sector.
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. Xiamen Jihong Package Tech 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, Xiamen Jihong Package Tech may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Containers & Packaging sector.
Weighted SWOT Analysis of Xiamen Jihong Package Tech Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Xiamen Jihong Package Tech 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 Xiamen Jihong Package Tech 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 Xiamen Jihong Package Tech 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 Xiamen Jihong Package Tech 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 Xiamen Jihong Package Tech needs to make to build a sustainable competitive advantage.
