SWOT Analysis / TOWS Matrix for Guangxi Guidong Eletric (China)
Based on various researches at Oak Spring University , Guangxi Guidong Eletric is operating in a macro-environment that has been destablized by – geopolitical disruptions, increasing energy prices, competitive advantages are harder to sustain because of technology dispersion, digital marketing is dominated by two big players Facebook and Google, cloud computing is disrupting traditional business models, increasing household debt because of falling income levels, banking and financial system is disrupted by Bitcoin and other crypto currencies,
increasing government debt because of Covid-19 spendings, talent flight as more people leaving formal jobs, etc
Introduction to SWOT Analysis of Guangxi Guidong Eletric
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Guangxi Guidong Eletric can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Guangxi Guidong Eletric, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Guangxi Guidong Eletric 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 Guangxi Guidong Eletric can be done for the following purposes –
1. Strategic planning of Guangxi Guidong Eletric
2. Improving business portfolio management of Guangxi Guidong Eletric
3. Assessing feasibility of the new initiative in China
4. Making a Electric Utilities sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Guangxi Guidong Eletric
Strengths of Guangxi Guidong Eletric | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Guangxi Guidong Eletric are -
Highly skilled collaborators
– Guangxi Guidong Eletric has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Electric Utilities industry. Secondly the value chain collaborators of Guangxi Guidong Eletric have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to lead change in Electric Utilities
– Guangxi Guidong Eletric is one of the leading players in the Electric Utilities industry in China. Over the years it has not only transformed the business landscape in the Electric Utilities industry in China but also across the existing markets. The ability to lead change has enabled Guangxi Guidong Eletric in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Learning organization
- Guangxi Guidong Eletric 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 Guangxi Guidong Eletric is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Guangxi Guidong Eletric emphasize – knowledge, initiative, and innovation.
Analytics focus
– Guangxi Guidong Eletric 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 Electric Utilities 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.
Digital Transformation in Electric Utilities industry
- digital transformation varies from industry to industry. For Guangxi Guidong Eletric digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Guangxi Guidong Eletric 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.
Diverse revenue streams
– Guangxi Guidong Eletric is present in almost all the verticals within the Electric Utilities industry. This has provided Guangxi Guidong Eletric 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.
Training and development
– Guangxi Guidong Eletric has one of the best training and development program in Utilities 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.
Effective Research and Development (R&D)
– Guangxi Guidong Eletric has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Guangxi Guidong Eletric staying ahead in the Electric Utilities industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Innovation driven organization
– Guangxi Guidong Eletric is one of the most innovative firm in Electric Utilities sector.
Sustainable margins compare to other players in Electric Utilities industry
– Guangxi Guidong Eletric has clearly differentiated products in the market place. This has enabled Guangxi Guidong Eletric to fetch slight price premium compare to the competitors in the Electric Utilities industry. The sustainable margins have also helped Guangxi Guidong Eletric to invest into research and development (R&D) and innovation.
High brand equity
– Guangxi Guidong Eletric has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Guangxi Guidong Eletric to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Strong track record of project management in the Electric Utilities industry
– Guangxi Guidong Eletric is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses of Guangxi Guidong Eletric | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Guangxi Guidong Eletric are -
Slow decision making process
– As mentioned earlier in the report, Guangxi Guidong Eletric has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Electric Utilities industry over the last five years. Guangxi Guidong Eletric 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Guangxi Guidong Eletric is slow explore the new channels of communication. These new channels of communication can help Guangxi Guidong Eletric to provide better information regarding Electric Utilities products and services. It can also build an online community to further reach out to potential customers.
High bargaining power of channel partners in Electric Utilities industry
– because of the regulatory requirements in China, Guangxi Guidong Eletric is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the Electric Utilities industry.
High cash cycle compare to competitors
Guangxi Guidong Eletric has a high cash cycle compare to other players in the Electric Utilities industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Slow to strategic competitive environment developments
– As Guangxi Guidong Eletric is one of the leading players in the Electric Utilities industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Electric Utilities industry in last five years.
Products dominated business model
– Even though Guangxi Guidong Eletric has some of the most successful models in the Electric Utilities industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Guangxi Guidong Eletric should strive to include more intangible value offerings along with its core products and services.
Interest costs
– Compare to the competition, Guangxi Guidong Eletric 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 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 Guangxi Guidong Eletric supply chain. Even after few cautionary changes, Guangxi Guidong Eletric is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Guangxi Guidong Eletric vulnerable to further global disruptions in South East Asia.
Ability to respond to the competition
– As the decision making is very deliberative at Guangxi Guidong Eletric, in the dynamic environment of Electric Utilities industry it has struggled to respond to the nimble upstart competition. Guangxi Guidong Eletric has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High dependence on Guangxi Guidong Eletric ‘s star products
– The top 2 products and services of Guangxi Guidong Eletric still accounts for major business revenue. This dependence on star products in Electric Utilities industry has resulted into insufficient focus on developing new products, even though Guangxi Guidong Eletric has relatively successful track record of launching new products.
Need for greater diversity
– Guangxi Guidong Eletric 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.
Guangxi Guidong Eletric Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Guangxi Guidong Eletric are -
Learning at scale
– Online learning technologies has now opened space for Guangxi Guidong Eletric 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
– Guangxi Guidong Eletric can develop new processes and procedures in Electric Utilities 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
– Guangxi Guidong Eletric can use the latest technology developments to improve its manufacturing and designing process in Electric Utilities 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Guangxi Guidong Eletric 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 Guangxi Guidong Eletric to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Better consumer reach
– The expansion of the 5G network will help Guangxi Guidong Eletric to increase its market reach. Guangxi Guidong Eletric 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Guangxi Guidong Eletric can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Creating value in data economy
– The success of analytics program of Guangxi Guidong Eletric has opened avenues for new revenue streams for the organization in Electric Utilities industry. This can help Guangxi Guidong Eletric to build a more holistic ecosystem for Guangxi Guidong Eletric products in the Electric Utilities industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Use of Bitcoin and other crypto currencies for transactions in Electric Utilities industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Guangxi Guidong Eletric in the Electric Utilities industry. Now Guangxi Guidong Eletric can target international markets with far fewer capital restrictions requirements than the existing system.
Loyalty marketing
– Guangxi Guidong Eletric 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.
Leveraging digital technologies
– Guangxi Guidong Eletric 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
– Guangxi Guidong Eletric can improve the customer journey of consumers in the Electric Utilities 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Electric Utilities industry, but it has also influenced the consumer preferences. Guangxi Guidong Eletric can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Guangxi Guidong Eletric is facing challenges because of the dominance of functional experts in the organization. Guangxi Guidong Eletric can utilize new technology in the field of Electric Utilities industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Threats Guangxi Guidong Eletric External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Guangxi Guidong Eletric are -
Environmental challenges
– Guangxi Guidong Eletric 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. Guangxi Guidong Eletric can take advantage of this fund but it will also bring new competitors in the Electric Utilities industry.
Stagnating economy with rate increase
– Guangxi Guidong Eletric 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 Electric Utilities industry.
Easy access to finance
– Easy access to finance in Electric Utilities industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Guangxi Guidong Eletric 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. Guangxi Guidong Eletric needs to understand the core reasons impacting the Electric Utilities industry. This will help it in building a better workplace.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Electric Utilities industry are lowering. It can presents Guangxi Guidong Eletric with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Electric Utilities sector.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Guangxi Guidong Eletric may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Electric Utilities sector.
Consumer confidence and its impact on Guangxi Guidong Eletric 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 Electric Utilities industry and other sectors.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Guangxi Guidong Eletric in Electric Utilities industry. The Electric Utilities 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.
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 Guangxi Guidong Eletric in the Electric Utilities sector and impact the bottomline of the organization.
Shortening product life cycle
– it is one of the major threat that Guangxi Guidong Eletric is facing in Electric Utilities sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Guangxi Guidong Eletric 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 Guangxi Guidong Eletric prominent markets.
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 Guangxi Guidong Eletric.
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.
Weighted SWOT Analysis of Guangxi Guidong Eletric Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Guangxi Guidong Eletric 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 Guangxi Guidong Eletric 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 Guangxi Guidong Eletric 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 Guangxi Guidong Eletric 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 Guangxi Guidong Eletric needs to make to build a sustainable competitive advantage.