SWOT Analysis / TOWS Matrix for HPGC Renmintongtai Pharm (China)
Based on various researches at Oak Spring University , HPGC Renmintongtai Pharm is operating in a macro-environment that has been destablized by – there is increasing trade war between United States & China, competitive advantages are harder to sustain because of technology dispersion, increasing commodity prices, wage bills are increasing, there is backlash against globalization, increasing transportation and logistics costs, increasing household debt because of falling income levels,
increasing inequality as vast percentage of new income is going to the top 1%, increasing energy prices, etc
Introduction to SWOT Analysis of HPGC Renmintongtai Pharm
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that HPGC Renmintongtai Pharm can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the HPGC Renmintongtai Pharm, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which HPGC Renmintongtai Pharm 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 HPGC Renmintongtai Pharm can be done for the following purposes –
1. Strategic planning of HPGC Renmintongtai Pharm
2. Improving business portfolio management of HPGC Renmintongtai Pharm
3. Assessing feasibility of the new initiative in China
4. Making a Retail (Drugs) sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of HPGC Renmintongtai Pharm
Strengths of HPGC Renmintongtai Pharm | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of HPGC Renmintongtai Pharm are -
Sustainable margins compare to other players in Retail (Drugs) industry
– HPGC Renmintongtai Pharm has clearly differentiated products in the market place. This has enabled HPGC Renmintongtai Pharm to fetch slight price premium compare to the competitors in the Retail (Drugs) industry. The sustainable margins have also helped HPGC Renmintongtai Pharm to invest into research and development (R&D) and innovation.
Low bargaining power of suppliers
– Suppliers of HPGC Renmintongtai Pharm in the Services sector have low bargaining power. HPGC Renmintongtai Pharm has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps HPGC Renmintongtai Pharm to manage not only supply disruptions but also source products at highly competitive prices.
Diverse revenue streams
– HPGC Renmintongtai Pharm is present in almost all the verticals within the Retail (Drugs) industry. This has provided HPGC Renmintongtai Pharm 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.
Innovation driven organization
– HPGC Renmintongtai Pharm is one of the most innovative firm in Retail (Drugs) sector.
Analytics focus
– HPGC Renmintongtai Pharm 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 Retail (Drugs) 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.
Cross disciplinary teams
– Horizontal connected teams at the HPGC Renmintongtai Pharm 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.
High switching costs
– The high switching costs that HPGC Renmintongtai Pharm 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.
Superior customer experience
– The customer experience strategy of HPGC Renmintongtai Pharm in Retail (Drugs) industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Digital Transformation in Retail (Drugs) industry
- digital transformation varies from industry to industry. For HPGC Renmintongtai Pharm digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. HPGC Renmintongtai Pharm 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 HPGC Renmintongtai Pharm comprises – understanding the underlying the factors in the Retail (Drugs) 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.
Organizational Resilience of HPGC Renmintongtai Pharm
– The covid-19 pandemic has put organizational resilience at the centre of everthing HPGC Renmintongtai Pharm does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– HPGC Renmintongtai Pharm has one of the best training and development program in Services 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 HPGC Renmintongtai Pharm | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of HPGC Renmintongtai Pharm are -
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 HPGC Renmintongtai Pharm supply chain. Even after few cautionary changes, HPGC Renmintongtai Pharm is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left HPGC Renmintongtai Pharm vulnerable to further global disruptions in South East Asia.
High cash cycle compare to competitors
HPGC Renmintongtai Pharm has a high cash cycle compare to other players in the Retail (Drugs) industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
No frontier risks strategy
– From the 10K / annual statement of HPGC Renmintongtai Pharm, it seems that company is thinking out the frontier risks that can impact Retail (Drugs) 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.
Lack of clear differentiation of HPGC Renmintongtai Pharm products
– To increase the profitability and margins on the products, HPGC Renmintongtai Pharm needs to provide more differentiated products than what it is currently offering in the marketplace.
Workers concerns about automation
– As automation is fast increasing in the Retail (Drugs) industry, HPGC Renmintongtai Pharm 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 operating costs
– Compare to the competitors, HPGC Renmintongtai Pharm has high operating costs in the Retail (Drugs) industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract HPGC Renmintongtai Pharm lucrative customers.
Slow decision making process
– As mentioned earlier in the report, HPGC Renmintongtai Pharm has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Retail (Drugs) industry over the last five years. HPGC Renmintongtai Pharm 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.
Capital Spending Reduction
– Even during the low interest decade, HPGC Renmintongtai Pharm 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 Retail (Drugs) industry using digital technology.
Compensation and incentives
– The revenue per employee of HPGC Renmintongtai Pharm is just above the Retail (Drugs) 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.
Low market penetration in new markets
– Outside its home market of China, HPGC Renmintongtai Pharm needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Ability to respond to the competition
– As the decision making is very deliberative at HPGC Renmintongtai Pharm, in the dynamic environment of Retail (Drugs) industry it has struggled to respond to the nimble upstart competition. HPGC Renmintongtai Pharm has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
HPGC Renmintongtai Pharm Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of HPGC Renmintongtai Pharm are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects HPGC Renmintongtai Pharm can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, HPGC Renmintongtai Pharm can use these opportunities to build new business models that can help the communities that HPGC Renmintongtai Pharm operates in. Secondly it can use opportunities from government spending in Retail (Drugs) sector.
Developing new processes and practices
– HPGC Renmintongtai Pharm can develop new processes and procedures in Retail (Drugs) 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.
Creating value in data economy
– The success of analytics program of HPGC Renmintongtai Pharm has opened avenues for new revenue streams for the organization in Retail (Drugs) industry. This can help HPGC Renmintongtai Pharm to build a more holistic ecosystem for HPGC Renmintongtai Pharm products in the Retail (Drugs) industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Retail (Drugs) industry, but it has also influenced the consumer preferences. HPGC Renmintongtai Pharm can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Use of Bitcoin and other crypto currencies for transactions in Retail (Drugs) industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for HPGC Renmintongtai Pharm in the Retail (Drugs) industry. Now HPGC Renmintongtai Pharm can target international markets with far fewer capital restrictions requirements than the existing system.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, HPGC Renmintongtai Pharm 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 HPGC Renmintongtai Pharm to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Loyalty marketing
– HPGC Renmintongtai Pharm 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.
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. HPGC Renmintongtai Pharm can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 HPGC Renmintongtai Pharm 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.
Building a culture of innovation
– managers at HPGC Renmintongtai Pharm 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 Retail (Drugs) industry.
Leveraging digital technologies
– HPGC Renmintongtai Pharm 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
– HPGC Renmintongtai Pharm can improve the customer journey of consumers in the Retail (Drugs) 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 HPGC Renmintongtai Pharm External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of HPGC Renmintongtai Pharm 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 HPGC Renmintongtai Pharm in the Retail (Drugs) sector and impact the bottomline of the organization.
Regulatory challenges
– HPGC Renmintongtai Pharm 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 Retail (Drugs) industry regulations.
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 HPGC Renmintongtai Pharm business can come under increasing regulations regarding data privacy, data security, etc.
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.
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. HPGC Renmintongtai Pharm needs to understand the core reasons impacting the Retail (Drugs) industry. This will help it in building a better workplace.
Technology acceleration in Forth Industrial Revolution
– HPGC Renmintongtai Pharm has witnessed rapid integration of technology during Covid-19 in the Retail (Drugs) industry. As one of the leading players in the industry, HPGC Renmintongtai Pharm needs to keep up with the evolution of technology in the Retail (Drugs) 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 Retail (Drugs) industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. HPGC Renmintongtai Pharm 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 HPGC Renmintongtai Pharm
– 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 HPGC Renmintongtai Pharm.
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 HPGC Renmintongtai Pharm.
High dependence on third party suppliers
– HPGC Renmintongtai Pharm 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.
Environmental challenges
– HPGC Renmintongtai Pharm 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. HPGC Renmintongtai Pharm can take advantage of this fund but it will also bring new competitors in the Retail (Drugs) industry.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Retail (Drugs) industry are lowering. It can presents HPGC Renmintongtai Pharm with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Retail (Drugs) 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. HPGC Renmintongtai Pharm 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.
Weighted SWOT Analysis of HPGC Renmintongtai Pharm Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at HPGC Renmintongtai Pharm 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 HPGC Renmintongtai Pharm 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 HPGC Renmintongtai Pharm 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 HPGC Renmintongtai Pharm 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 HPGC Renmintongtai Pharm needs to make to build a sustainable competitive advantage.
